Embracing Holistic Well-being to Advance Business Performance

Author: Laci Loew

Introduction

A focus on employee health is not new but is on a different and momentous journey globally and has a long way to go. Alight research published by BENEFITS PRO in September 2023 says just 51 percent of the workforce reports feeling positively about their mental, physical, and financial well-being, and only 41 percent of the workforce reports feeling that their employer cares about their well-being in 2023 - a six percent decline from 2022. As such, senior HR and business leaders are looking for the most effective ways to move from a traditional, low value focus on employee health and safety programs to a modern, holistic well-being strategy with outsized benefits that this fuller approach delivers.

Slow Progress

The Alight research results don't stand alone. Even though more than half of survey respondents from XpertHR's Global Employee Well-being 2023 Survey Report indicated that holistic well-being was a business priority or important, only half that amount (34.5 percent on average) have a dedicated well-being budget. More alarming, just 9 percent of organizations use well-being data as a part of the assessment of leader performance to ensure ongoing progress of well-being.

These laggard organizations that treat well-being as nothing more than a one-off task, or approach it reactively when a legal, compliance or performance issue arises, find themselves indefinitely stalled on progress. They fail to make headway on identifying and addressing root causes.

Getting Started

This guide details an effective approach to holistic well-being and is specifically intended for senior-level HR and well-being leaders. It covers the definition of well-being, the leading practices of an effective strategy, key findings from our global well-being research, a well-being maturity model, a diagnostic for assessing current state maturity, action planning associated with advancing the maturity of well-being, and the business impact of a mature approach to well-being.

For this leading practice guide to be most helpful in effectively advancing organizational well-being, senior HR and well-being leaders should:

• Bring together a cross-functional team of leaders to understand the leading practices and the evidence that drives them.
• Self-assess the maturity of their organization's current well-being practices.
• Agree upon critical actions for advancing practices toward higher levels of maturity and impact.  
• Identify a senior-level well-being champion and dedicated team to be accountable for the ongoing impact/effectiveness of the practices.
• Identify current resources (budget, people, technology) and define how they might need to be modified and/or expanded.
• Define what success looks like (i.e., target performance/maturity level).
• Track progress, celebrate and communicate successes.

To facilitate achievement of these objectives, this leading practice guide should be used in conjunction with XpertHR's 2023 Well-being Data Placemat and Self-Assessment Diagnostic (also designed for use by senior HR and well-being leaders) and other trusted resources on well-being.

Defining Well-being

Holistic well-being focuses on the whole person and supports seven interconnected components of wellness that affect individuals in their daily lives: physical, social, mental, and financial health as well as close social relationships, integrity and morality, and a sense of life and work purpose. See Figure 1.

Figure 1. Components of Holistic Employee Well-being

In a multi-year research study released in August 2023 entitled "The Global Flourishing Study," Tyler Vanderweele from Harvard University along with renowned research partners Baylor University, Center for Open Science, and Gallup discuss major determinants of well-being that advance (or detract from) performance among them:

• Personal habits;
• Character;
• Relationships;
• Family and community;
• Spirituality (which may or may not be religiously oriented);
• Education and employment;
• Demographics; and
• Financial stability

Upon studying and understanding the determinants, a red thread stands prominently: the home-work link. In other words, employees' satisfaction with life at home affects their performance at work (and vice versa). The level of happiness or satisfaction with both sides of this link influence one's overall well-being. This is called holistic well-being.

To (re)design an organizational holistic well-being strategy, leaders start by answering fundamental questions:

• What does well-being look like here? Does it embody all elements?
• What should well-being look like? How do we get started?
• How do we know if employees feel like we are investing in their well-being?
• What components of well-being are most important to what talent segments?
• Do we have sufficient funds to enable a holistic approach to wellbeing?
• Who should oversee well-being?
• How will we know if our well-being approach is successful?
• How does well-being influence working arrangements?
• How prepared are leaders to explain well-being concepts to employees?
• Are our employees happy? Satisfied?
• Are we considering the impact on employees' families?
• Would our employees describe our organization as an employer of choice?
• Do our employees believe they are personally and professionally fulfilled?

Then, leaders align on measurable well-being outcomes they seek. Some of these include:

• Reduced workforce stress and burnout.
• Reduced absenteeism.
• Higher engagement.
• Higher productivity.
• Better employer brand.
• Improved corporate brand.
• Broader candidate pools.
• Improved net promoter score (NPS).
• Improved employee net promoter score (eNPS).

Well-being in life (at home and at work) affects mood, sense of happiness and feelings of self-worth and has implications on levels of anxiety and tension, feelings of isolation or depression and physical illness or worse. It impacts how effectively one moves toward personal fulfillment, greater social involvement, and productivity.

Fundamental Concepts of Holistic Well-being

The overall aim of well-being is quite simple: improve holistic well-being to advance quality of life and improve business performance. To advance progress, leading practice organizations design well-being strategies with adherence to the following four concepts.

Well-being Does Not Equal Mental Health

Unfortunately, many talk about mental health programs to describe the organization's well-being strategy. Mental health is not holistic well-being. Mental health is made up of humans' emotional, psychological, and social wellness. It affects how individuals think, feel, and act and impacts how well stress is handled. Organizations often provide one-off mental health activities or programmatic solutions such as an Employee Assistance Program (EAP) with the goal of providing problem-solving and coaching resources to employees so they can improve their thinking and feeling behaviors. These initiatives are but one cog in the wheel of high-impact well-being.

Well-being Is a Leadership Imperative

Until very recently, integrating holistic well-being into the fabric of an organization's culture has been largely unheard of. Beyond bare bones mental health services, organizations have traditionally expected employees to figure out life-work satisfaction, meaning and happiness on their own. Even well-intentioned leaders ignored signs of employee burnout and unhealthy work practices expecting employees to power through at high levels of performance regardless of the toll on health and relationships. After watching turnover skyrocket and engagement plummet when employees are forced to work in unhealthy environments, high-impact leaders acknowledge the business benefit that a culture of well-being brings, take accountability for creating and maintaining holistic well-being, and share stories of success for further advancement.

Well-Being Done Right is Co-Created with the Workforce

To facilitate the emergence of healthier life-work patterns, organizations need to move away from legacy mindsets (e.g., command and control, top-down) and find ways to encourage the employees' voice in identifying gaps and improving systems that contribute to a well-being culture. To get well-being right, every seat is one of leadership. Gaining deep awareness of workforce expectations and listening actively to employees' needs and desires, develops organizational capacities to better cope with times of uncertainty and transformation. The "let's design it together approach" reduces stress and builds organizational muscles of resiliency and sustainability while employees erect personal ecosystems of well-being to weather whatever comes their way.

Well-being Is Not One-Size-Fits-All

Organizational well-being provides the scaffolding for employees to flourish and organizations to thrive. Achieving high-impact well-being requires more than proclamations of its importance and a vanilla approach to its design. Organizations need to intimately understand the leading practices of holistic well-being. They should:

• Pay attention to how those practices manifest themselves in the context of getting work done;
• Seek to understand how dialing up those practices accelerates the home-work link creating a better quality of life for employees; and
• Take vital actions to produce the emergence of healthier systems - organizational, functional, systemic.

By doing this, leaders instantiate a culture of holistic well-being that can be continuously monitored for impact and improvement over time.

Getting started with creating and maintaining a culture of well-being requires leadership to be intimate with these concepts and align their approach with leading practices that inform a high-impact well-being strategy.

Framework of Leading Practices

Execution of five leading practices create, or expand, a sustainable culture of well-being and influence the maturation and impact of an organization's holistic well-being. High-impact organizations - those with better business outcomes than those of their less impactful peers - execute on all five at the highest level of maturation.

• Strategy and Planning - Organizational commitment to build and maintain a culture of integrated and holistic well-being (physical health, emotional stability, financial wellness, life satisfaction and purpose) promoting a positive employee experience and inclusive environment allowing employees to flourish and the business to thrive.
• Leadership and Advocacy - Senior leadership owns, endorses, and champions the organization's well-being strategy and regularly and transparently communicates internally and externally about the organization's commitment to well-being.
• Scope and Stakeholders - Well-being is a way of life at work and at home with a full array of integrated solutions supporting all aspects of well-being (physical, emotional, financial, life satisfaction and self-purpose) available to employees and their families and friends -- not a set of programmatic, ad hoc offerings (e.g., psychological safety online course, EAP hotline, first aid certification, etc.).
• Resources and Tools - A dedicated well-being budget exists to support the ongoing allocation of staff and acquisition of tools and technology to enable well-being as a business priority.
• Measurement and Impact - Key business and talent metrics (e.g., NPS, eNPS, turnover, employee engagement, revenue, etc.) are baselined and regularly captured, monitored, reported, and shared (typically through customized dashboards) to report to stakeholders on the impact of well-being on organizational business and talent performance as well as the overall employee experience.

Leaders should recognize that their organization may deliver on some of these practices and not others or deliver on some or all practices in part but not necessarily to the highest level of maturation. This presents an opportunity for advancing the maturity of well-being practices.

Key Findings

Five key findings from XpertHR's Global Employee Well-being 2023 Survey Report are:

1. Effective well-being requires explicit funding. On average, just 34.5 percent of organizations have a dedicated well-being budget. For those that do, they report an improvement in customer loyalty, net promoter score, employee engagement, and key talent turnover.
2. Holistic well-being relies on leaders' communication. Of those surveyed, about half reported that leaders only occasionally acknowledge the importance of well-being. Yet, improving, and sustaining well-being requires that leaders regularly check-in with employees about how satisfied they are at home and at work. They should frequently ask their opinions about how well the organization's well-being actions are supporting their work-life happiness and invite their recommendations for how to better meet their needs. Leadership should also make it a practice to communicate to other stakeholders (partners, vendors, the public) about the organization's commitment to holistic well-being.
3. When well-being strategies expand services to employees' families, there is a marked improvement in all four business and talent key performance indicators (KPIs): customer loyalty, NPS, employee engagement and key talent turnover. An effective way to show that the well-being of employees is a priority is to show care for their families, too. Employees' financial stresses impact spouses, children, and other familial relations. An employee's commitment to better exercise and healthier eating habits are better carried out when familial support is present; organizations can do their part by offering nutritional counseling and fitness membership perks to family members. Taking actions like these to extend well-being services to employees' families shows organizational commitment to the satisfaction, happiness, and wellness of their employees.
4. More than two-thirds of organizations have no training for managers on well-being, and of the few that do, it is for very specific and narrow areas of wellness such as menopause awareness, first aid, and other fundamental health and safety areas. To create a culture of well-being, organizations serve themselves well by educating their leaders on the criticality of well-being in creating an engaged workforce and advancing performance and productivity.
5. Co-creation with stakeholders leads to a more effective strategy. HR leaders should facilitate small group sessions and consider administering pulse surveys to get feedback from managers, employees, and other stakeholders. The best experts to identify sources of stress, inequity, work challenges, development issues as well as to create thoughtful and innovative well-being strategy are the workforce, partners, suppliers, and customers. Asking for their voices and co-creating a holistic strategy are keys in the strategy's long-term success.

Maturity Model and Advancing Progress

Our research findings and experience with many organizations around the world indicate that, in practice, there are five levels of well-being maturity:

Level 1 Basic Wellness Benefits	Well-being is seen as an employee health (mental wellness) and safety compliance activity. A holistic strategy does not exist, and there is little to no leadership ownership nor measurement strategy.
Level 2 Culture of Caring and Concern	Leaders are generally human-centered and are beginning to embrace well-being with a few functions/business units. Limited effort is made to design a strategy. There is very limited, if any, dedicated budget, and a handful of programmatic wellness activities are available to some employees.
Level 3 Whole Human-being View of Employees	Leadership is aware of the business value of holistic well-being and has documented a strategy with sporadic implementation of parts of the strategy. A dedicated, though small, budget allows for some well-being solutions made available to employees only. Some metrics are being defined and tracked in some parts of the business.
Level 4 Extended Holistic Well-being Ecosystem	Holistic well-being is endorsed by senior leadership. A full array of holistic well-being solutions is available to employees and, in many instances, their families, too. The strategy is regularly assessed for impact and actual and target performance as well as benchmark performance is shared with internal and external stakeholders.
Level 5 Holistic Well-being as a Positive Influencer on the Workforce, Policy, and Society	Holistic well-being is seen as a business imperative and endorsed by the Board of Directors. Executive leadership regularly communicates internally and externally about its business value and impact on the employee experience. A dedicated and rich budget exists expanding holistic well-being to all employees, their families, and communities. The strategy is enabled with tools, technology, apps, and dashboards that serve to inform and advance progress in all areas of holistic well-being while monitoring KPI performance.

Organizations on a well-being journey aiming to improve practices should start by identifying the organization's current level of maturity. Then, necessary actions can be taken to advance progress. To define current maturity level and begin action planning, senior HR and well-being leaders can use XpertHR's 2023 Well-being Data Placemat and Self-Assessment Diagnostic.

As described in the self-assessment diagnostic, there are several workplace factors that can influence the impact of an organization's holistic well-being strategy, including:

Factor	Key Question	If, Then
Cultural	Is well-being immersed into the culture and fabric of the organization?	If organizations treat well-being merely like an HR program or initiative, then impact will be low.
Holistic	Does the organization's well-being strategy encompass all aspects of employee wellness including physical, social, financial, and mental health as well as close social relationships and a sense of life and work purpose?	If employee wellness is focused only on mental health, then impact will be low.
Management	Do leaders acknowledge the critical role they play in endorsing and advancing employees' well-being and does the organization invest in developing leaders to enable them with the skills to do so?	If employees are left to advocate for their own well-being, then impact will be low.
Scope	Does the organization extend the well-being framework to respond equally to the entire workforce, their families, and community needs?	If well-being is limited to employees only, then impact will be low.
Resources	Does the organization prioritize dedicated budget and resources (including tools and technology) to well-being?	If well-being doesn't have a dedicated and rich budget, then impact will be low.
Priority	Does the organization value, measure, and broadly communicate about well-being being a key component of the employee experience?	If well-being is treated as an afterthought, then impact will be low.

In general, to advance from one maturity level to the next, here is a shortlist of quick wins - some strategic and some very tactical -- employers and employees can take.

Employees can/should:

Employers can/should:

Be intentional about making a close friendship or two at work. Participate in group fitness challenges. Take charge of personal development. Practice preventative health care. Use diagnostic tools to discover personal pleasures and passions that offer a true sense of purpose. Make a personal budget and stick to it. Be aware of personal feelings daily. Accept the current situation and define one or two steps to move it forward. Develop a grateful mindset by recording daily what was appreciated that 24-hour period. Dedicate time every week to do "outside of work" activities. Improve sleep patterns. Try out a plant-based diet.

Use technology to ensure equitable access to fitness perks for remote workers without access to an on-site fitness facility. Accommodate flexible work schedules. Provide no-cost access to well-being tools and digital apps. Utilize gamification to encourage participation in fitness challenges with co-workers. Regularly communicate about senior leadership's commitment to holistic well-being. Redesign work to enable collaboration and meaningful, high-value assignments. Give employees agency and autonomy over how they get their work done. Invite employees' voice to identify and solve workplace issues that contribute to stress and burnout. Keep organization properly staffed so workloads are not excessive. Foster a culture of social belonging and inclusive workplace. Make an expert available to offer financial tips to employees regarding personal budgeting, retirement savings, and other monetary practices.

Improving the business impact of well-being is a methodical process requiring level by level advancement. It is not possible to skip levels. The overall goal is to make thoughtful movement from one level to the next. If approached successfully, holistic well-being will allow an organization to attract, engage, and retain top talent that flourishes at work and at home while the business enjoys improved levels of performance on KPIs.

Business Impact

Leading practice organizations (levels 4 and 5) are more likely to report improvement on KPIs than their laggard peers (levels 1 and 2). Research by The Josh Bersin Company and as reported by HR Executive in October 2023 indicates organizations that leverage holistic well-being strategies are more than twice as likely to outperform their peers financially, five times more likely to have lower annual health care claim costs and three times better at engaging and retaining their employees. XpertHR's Global Employee Well-being 2023 Survey Report indicates similar results. See Figure 2.

Figure 2. Change in Business Outcomes for Leading-Practice VS Laggard Organizations

Summarizing the results shown in Figure 2, the change in business outcomes (KPIs) for leading practice versus laggard organizations is as follows:

• 26 percent more had improved net promoter scores.
• 42 percent more had improved customer loyalty.
• 33 percent more had improved employee engagement.
• 18 percent more had improved turnover of key talent.

Our impact results aren't outliers. There are similar compelling impact data from many sources including, but not limited to, Harvard, Mercer, LinkedIn, PwC, and Deloitte to start.

Case in Point

Accenture presents, "Caring for employees = Caring for business" and describes how employee well-being is just smart business:

Impressively, released September 20, 2023, Accenture ranks fifth in the top ten list of US companies honored for their commitment.

Overall, the evidence is very much in favor that there are measurable, objective business and talent benefits to holistic well-being. Employees happy at home, at work, and with life are more productive, more likely to stay, and more attracted to their organization than their competitors.

Closing

Designing and maintaining a mature approach to holistic employee well-being is a journey, not a destination. Leadership advocacy, dedicated resources, personalized tools, and technology are critical enablers to a high-impact expedition.

High-impact employers are responding - replacing employee wellness as a nice-to-have with holistic employee well-being as a must-have. By addressing mental health concerns, promoting a work environment that focuses on purpose and building social relationships, and advocating for physical and financial wellness for employees and their families and communities, organizations are investing in exactly what powers the business - the people, and in so doing are preventing performance and productivity losses and improving their bottom line.