How Leaders Can Improve Culture by Prioritizing Employee Well-being
Date Posted: Wed, 11 May, 2022
The Great Resignation, The Great Rethink, or The Great Reprioritization—regardless of the terminology you prefer, the reality is that we are living through a period unlike anything in the global history of work. To ensure your organization is equipped to handle these shifting times, prioritizing organizational culture by supporting employee well-being is crucial.
First: what is well-being? At Russell Reynolds Associates, we define it as the overall mental, physical, emotional, and economic health of employees. Well-being is influenced by various factors, including co-worker relationships, organizational purpose and mission, growth opportunities, and the tools and resources employees have access to.
Currently, overall employee well-being is in a dire state. According to non-profit organization Mind Share Partners, 84% of employees in the United States reported at least one workplace factor that negatively impacted their mental health in 2021. Furthermore, 50% of employees claimed to have left their jobs for their mental health in 2021.1 Comparatively, the question of why leaders move jobs is less examined. In our 2022 Global Leadership Monitor, which surveyed over 1,500 leaders across role, sector, and industry worldwide, Russell Reynolds found that 20% of leaders who left a job in 2021 did so to prioritize their physical and emotional well-being. Even more noteworthy: 37% of CEOs made the same choice. With continued reshuffling in 2022, these numbers will invariably increase among both junior and senior staff.
- 84% of employees in the United States reported at least one workplace factor that negatively impacted their mental health in 2021
- 50% of employees claimed to have left their jobs for their mental health in 2021
- 20% of leaders who left a job in 2021 did so to prioritize their physical and emotional well-being
37% of CEOs left their job to prioritize physical and emotional well-being
To understand how employees are feeling about their organization’s culture and the level of leadership support they are receiving regarding well-being, Russell Reynolds administered a global culture imaging survey that reached over 10,000 people over the past year. We also surveyed 87 global human resources leaders across all sectors. Overall, we learned that while executives are taking culture and employee wellness seriously, there is still a gap between intention and execution. To address this, we developed a leadership framework that centers wellness and, by extension, culture. This framework includes the following principles:
01 Your employee is your first customer Investments and mindset shifts that support employee well-being, leading to increased customer satisfaction and community involvement
02 Leadership competencies Behaviors and skills that support well-being at all seniority levels
03 Recommendations How to incorporate wellness expertise into your leadership team and organizational strategy
There is a gap between leadership and employee expectations around wellness Recognizing the need to address culture concerns in this new way of working, HR leaders are taking steps to change how their organization prioritizes well-being. In our “2022 HR Leaders Global Wellness Survey” (N=87), 90% of respondents reported doing something differently in the past year to tackle employee well-being. This included (but was not limited to) well-being helplines, mandatory holiday time, financial gifts / spot bonuses, and additional holiday allowances.
However, there is still work to do: only 56% of HR leaders surveyed said that they were prepared to address their employee’s physical health, and only half felt prepared to address employee emotional health. Looking forward, only 54% said that they felt prepared or well-prepared to tackle employee future well-being. This points to the broader need for leaders with specific wellness competencies to immediately address deeper employee wellness concerns and gaps, while also planning for a healthier future.
To further examine this, RRA administered its “2022 Global Culture Imaging Survey,” a global cross-sector panel reaching over 10,000 employees. From this data, we learned a significant portion of employees are feeling the adverse effects of an organization designed without wellness in mind. As shown in Figure 1, over one-in-three employees reported difficulty maintaining a healthy worklife balance with their current employer, and over 40% said that it was tough to compete in their industry without incurring unhealthy stress levels. Furthermore, we know that growth opportunities are key to employees’ purpose at work. Yet over 35% of respondents stated that they do not feel supported to pursue personal development, and 40% did not feel appropriately recognized for their current contributions, lessening the motivation to pursue growth opportunities with their current employer.
Figure 1: Opportunities for Improvement in Global Employee Wellness Percentage of employees agreeing with each statement
25% Reported that leaders encouraged them to make unhealthy choices in order to get work done.
35% Had difficulty maintaining a healthy work-life balance with their current employer.
40% Felt it tough to compete in their industry without risking unhealthy levels of stress.
35% Did not feel supported to develop new skills, take on new responsibiilty, and advance their careers.
37% Reported that leaders did not provide feedback or advice that helped them improve.
40% Were not appropriately recognized for their contributions.
Given the networked nature of work today, this can have a very meaningful impact on culture and performance. Imagine you are overseeing a team of 12 that is carrying out strategic initiatives beheld to tight deadlines. Would your business plan be in trouble if four of those people left the organization, seeking a better work-life balance? Suddenly, these responses paint a much more worrisome picture.
The story is not much different for leaders. Our 2022 Global Leadership Monitor found that 53% of leaders felt there were good opportunities for them at their current employers, while 83% felt they had good or very good opportunities in their current industry. Conversely, 20% of the same population felt that they had poor opportunities at their current employer, while only 4% felt that way about the broader industry. This means that external opportunities look considerably more compelling than internal ones to everyone, including leadership.
While a “grass is always greener” phenomenon is part of human nature, there have never been more people venturing to the other side of the fence, especially when considering their well-being.
Your employee is your first customer The past two years left a lasting mark on everyone, fundamentally shifting the way work gets done. A few months of remote work could have been dismissed, but the extent of our collective experience means that there is no going back to normal. This goes beyond where we do our work—at home or in the office—and relates, more broadly, to a new prioritization system, in which family, friends, external interests, and collective wellness takes priority over work.2
The effects of a poor culture are quite tangible. A study by MIT Sloan Management Review revealed that toxic culture was the single best predictor of attrition during the first six months of the Great Resignation.3 The link between toxicity and attrition is not new: by one estimate, employee turnover triggered by negative cultures cost U.S. employers nearly $50 billion per year pre-pandemic.4
Additionally, views on culture are hard for employers to accurately gauge. Most culture assessment tools often deliver inaccurate data, as they are not perceived as actually anonymous. Even if enough employees trust in their anonymity, the assessment often fails to focus on the substantive issues that drive employee experiences, leaving leaders with an unclear view into what actions would be most effective.5 Often, because culture and wellness are so difficult to measure, organizations give up on assessing them altogether.
As the war for talent continues across all industries and sectors, leaders need to prioritize employee growth and wellness more than ever before, reframing them as the “first customer” of the organization.
New motivations in and outside of work Going beyond the old motivators—which included compensation, title, career progression, brand name, and location— culture experts believe that employees are and will continue to make decisions regarding work more holistically, considering purpose and mission, growth opportunities, financial incentives (including health benefits and paid time off), physical wellness, community involvement, mental and emotional support, and the ability to connect with one’s team in a social, flexible way (figure 2).