Why Workplace Wellbeing Matters: An Executive Summary.

I was just listening to a Podcast by HBR promoting a new book, "Why Workplace Wellbeing Matters: The Science Behind Employee Happiness and Organizational Performance" by Jan-Emmanuel De Neve and George Ward.

The book and authors highlight the critical link between workplace wellbeing and business success. The authors present compelling evidence demonstrating that workplace wellbeing is not just a “nice-to-have” but a strategic necessity that directly impacts productivity, retention, recruitment, profitability, and overall organizational performance. The key points are below and should be taken to heart.

What Is Workplace Wellbeing?

Workplace wellbeing is defined as how employees feel at work and about their work, encompassing three main components:

1. Evaluative Wellbeing (Job Satisfaction): How employees think about their jobs, usually measured through satisfaction surveys.

2. Affective Wellbeing (Emotional Experience): How employees feel daily at work, including both positive emotions (e.g., happiness) and negative emotions (e.g., stress).

3. Eudaimonic Wellbeing (Purpose and Meaning): Whether employees feel their work is meaningful and aligned with their sense of purpose.

The authors emphasize that true workplace wellbeing goes beyond simple “wellness programs” aimed at individuals. Instead, it requires holistic changes to work design, organizational culture, and management practices.

Why Does Workplace Wellbeing Matter?

1. Improved Productivity: Happier employees are more engaged, creative, and productive.

2. Talent Attraction & Retention: Organizations with higher wellbeing scores find it easier to attract top talent and retain them.

3. Financial Performance: Firms with high employee wellbeing also demonstrate higher profitability and better stock market performance.

4. Reduced Absenteeism & Turnover: High wellbeing reduces absenteeism and turnover, resulting in substantial cost savings.

The Role of Recognition in Workplace Wellbeing

Employee recognition is a significant contributor to workplace wellbeing. As highlighted in Kudos’ Making a Case for Employee Recognition, recognition boosts employee engagement, productivity, and organizational culture by reinforcing positive behaviors and fostering a sense of belonging.

Kudos' platform emphasizes:

• Personalized Recognition: Providing meaningful, structured, and measurable recognition that aligns with organizational values.

• Enhanced Engagement: Organizations with recognition programs are 12x more likely to have strong business outcomes.

• Reduced Turnover and Improved Wellness: Recognition-driven engagement leads to 81% less absenteeism and 41% lower turnover in low-turnover organizations.

Key Takeaways

• Wellbeing should be a strategic priority, integrated into organizational practices rather than addressed only through wellness programs.

• Measuring and improving employee wellbeing leads to better business outcomes, including higher productivity, retention, and profitability.

• Kudos employee recognition programs provide a powerful tool for enhancing employee wellbeing by creating a positive feedback loop of acknowledgment, satisfaction, and engagement.

Why Workplace Wellbeing Matters makes a strong case for reimagining how companies approach employee wellness. By integrating platforms like Kudos, organizations can build a robust culture that acknowledges and values their workforce, ultimately enhancing employee happiness and organizational performance.