Should Your Human Capital Strategy Focus on Thinner or Happier Employees?

January 26th, 2016

A Culture of Health or a Healthy Culture?

Several trending stories made me ponder this question as we attempt to develop strategies to maximize our human capital and minimize its expense that usually is translated to productivity and healthcare costs. I posit a simple question: Do we want healthier employees or happier employees?

Are they mutually exclusive? Should we strive for both? When I think of a culture of health, I imagine a check list that includes implementing a salad bar in the cafeteria, swapping out vending machine junk for healthier choices and painting the stairwells lime green to encourage an elevator embargo. Workplace changes are so 2014 – these should be in the works or completed already.

As for the employees, they are picking up their Fitbits from HR as we dangle incentives for them to sign up for programs to get healthier. Arguably, however, we see limited progress about motivating employees for sustainable change. Somewhere buried in this notion is achieving work/life balance.

The natives get restless when premiums go up, but they will not collectively, or on their own, do their part to lower healthcare costs because they see their co-workers continuing to eat French fries, not exercise and smoke. Oh, you better believe that employees understand the concept of the insurance pool! But what seems completely anathema is that employees don’t respond well to individual goal-based incentives to change behaviors either!

A study published recently by NPR reported that obese workers did not effectively respond to a goal-based incentive of $550 offered using three different incentive designs plus a control group without an incentive. Nineteen percent (19%) of the cohort did lose the goal of 5% of their weight to earn the incentive, but the goal achievers were dispersed across all four groups including no incentive at all!

Nearly all of the behavioral research I absorb suggests that people know what they need to do, but they don’t do it. Whoever can crack the code and get people do what they know they need to do when it clearly benefits them wins the Powerball of this era.

The answers from the experts all tend to follow the same pattern: take tiny steps and when you string together tiny changes you get behavior change. It’s a marathon, not a sprint. Habit changing takes a minimum of 40 days – 40 baby steps, one every day shows progress and progress leads to change. But fast brain says “eat the cookie”, slow brain says, “hold on what about your incentive?” Fast brain wins. This is exhausting. Are we looking at the trees here and not forest?

Another trending story appeared recently about Basecamp’s venerated CEO, Jason Fried, and the benefits policies he’s implemented for his highly paid employees (mostly software developers). The plan’s primary benefit is a paid vacation after one year on the job where the vacation itself is paid for by Basecamp to places like Martha’s Vineyard, the Grand Canyon, Ethiopia or Italy. More benefits include:
• Four-day work weeks from the beginning of May through the end of August.
• A $100 stipend for healthy activities; gym membership, yoga, etc.
• A $100 stipend for massages.
• A $1,000 continuing education allowance. The courses don’t have to be relevant to an employee’s job.
• 16 weeks of paid maternal leave, and 6 weeks of paid paternal leave.

The crown jewel of Basecamp’s culture is a notion of “work can wait” and the idea that no one should work more than 40 hours per week. The company doesn’t have gourmet chefs cooking you three meals per day or people doing your laundry, which “grosses out” Fried. His messages is [paraphrasing], “work 40 hours and get out. Go home to your families and enjoy your free time. Recharge and come back to do more great work.”

Fried defends these frothy benefits in that he has such low turnover; the benefits pay for themselves through the affinity built and productivity of his people when they do actually work. There are clearly many other factors in the mix that enable this kind of environment including having dozens of employees vs. thousands. Also, their business has evolved to have very high margins because of their leadership’s decision to focus on fewer products and make them the best in the market.

But if this is a petri dish of maximizing human capital (or mythical unicorn of the perfect company) and we assume that Basecamp has the highest ‘happy employee index’, how do we learn from this to close the gap between a culture of health and a healthy culture? OK – please save the rebuttal that Basecamp hasn’t been analyzed and anal-probed for everything wrong with it. But if you look at profitability per employee and turnover, I challenge anyone to come up with better KPIs.

We know at Consumable Science (shameless plug) that a person can have a BMI of 34, still be healthy and chalk up a high MyBodyScore! That’s right, not everyone has metabolic syndrome that has a high BMI! Some people really are just “big-boned”. Are we focusing on the right things? Shouldn’t employees find their own pathway to wellness and well-being where their employer takes the pressure off versus layering more on to be healthy, in addition to job duties themselves?

Is a culture of health inherent in a healthy culture? Can people achieve that coveted work-life balance so that they can do what they know they need to do on their own terms?

The Basecamp recruiting tag-line could be reframed, “…working at Basecamp is never going to be the excuse as to why you can’t be happy. Happiness is a benefit here.” I wonder how many other companies can say that?

-Teresa O’Keefe, co-founder, Chief Marketing Officer, Consumable Science