Mastering HR metrics: connecting wellbeing and engagement

I have spent more years than I care to remember helping organisations to measure, understand and improve employee engagement.

Employee engagement has been part of HR life for well over a decade. A pivotal moment came when David MacLeod and Nita Clarke founded ‘Engage for Success’, a growing, dynamic and nationally recognised voluntary movement for promoting employee engagement as a better way of working for individuals, teams and organisations.

Recognising the links between wellbeing and engagement

In the middle of a deep recession in 2009, the movement submitted the first ‘Engaging for Success’ report to government. This brought together all of the key insight, evidence and best practice that underpinned what we all intuitively had felt to that point. This was the only organisation that truly engaged and inspired their employees, producing world class levels of innovation, productivity and performance.

At the time, I was lucky enough to be a member of their ‘specialist forum’, brought together to provide expertise and input to the report; my team at research specialists Ipsos MORI was responsible for the accompanying literature review. Even back then, the report started to recognise the links between wellbeing and engagement. Since then the thinking and development around both subjects has evolved significantly and the link between them is now firmly established.

Ten years on from the publication of the report, employee engagement is firmly established as the biggest people challenge and priority for organisations, while in comparison workplace wellbeing is still evolving. The work of ‘Engage for Success’ has evolved further too. Their research has identified that engaged employees with high wellbeing are 35 per cent more attached to their organisations than those with lower wellbeing, and the best companies to work for frequently outperformed the FTSE 100, particularly during the economic downturn from 2009 onwards.

Wellbeing as a multi-faceted subject

In Barnett Waddingham’s recent research of UK employers, The Wellbeing Agenda (2018), 97 per cent told us that a happy and healthy workplace is a more productive one and the primary reason why organisations have developed, or are planning to develop, a workplace wellbeing strategy and programme.

Despite this, more than a third (35 per cent) of the employers surveyed have either not started developing a wellbeing strategy, or have no plans to do so, with the biggest barriers being a lack of time (31 per cent), resources or expertise (both 28 per cent). Only 42 per cent of those organisations with a wellbeing strategy in place believe it is fully functioning and delivering real benefits.

Wellbeing is becoming a more highly developed and multi-faceted subject and therefore so is its relationship with engagement. In fact, research evidence suggests that there is a two-way self-enforcing relationship between them where healthy employees are more engaged and engaged employees are healthier.

Demonstrating the link between wellbeing and engagement

The challenge for many organisations is being able to demonstrate this link to their management boards. A recent CIPD report, People Analytics: Driving Business Performance with People Data (June 2018), revealed that only around half of HR respondents said that their organisations use HR analytics to tackle business problems. When exploring the collection and reporting of relevant wellbeing and engagement metrics the results were equally poor as follows:

Data/metric Type	% of organisations collecting this data	% of organisations reporting this data
Absence and injury rates	47%	39%
Employee engagement scores	41%	35%
Employee performance/productivity rates	45%	34%
Team/function productivity/performance rates	40%	33%
Revenue per employee	34%	25%
Return on investment in the workforce	26%	22%
Employee intention to leave	29%	23%
Employee turnover	47%	36%
High potential employee turnover	31%	25%

The clear message to HR is: if you want wellbeing to matter and receive the right level of investment and senior support, you need to measure it and be able to demonstrate the value and benefit it delivers for your organisation and your employees.

This is reinforced by the CIPD research data which showed that 65 per cent of respondents who work for organisations with a strong people analytics culture said that their business performance was strong compared to just 32 per cent with a weak people analytics culture.

The author is Peter Meyler, head of workplace consultancy for Barnett Waddingham.

This article was provided by Barnett Waddingham.