Morale issues cost the average 200 employee UK company £3million a year. The evidence is clear that morale and motivation deeply impact:
For these reasons investing in effective morale improvement yields a higher return on investment than other spends.
So what is an effective morale intervention? Do wellbeing initiatives work? 35% of them do – perhaps because only 24% of people attend them (Gallup) – that’s not a great statistic if £3m a year at your bottom line is in play. As PwC’s report says, morale interventions need to embrace the psychological.
Poor morale comes from one of four things:
The strategy is as one would expect:
The great good news is that in order to achieve any of these four, you need to achieve all of them.
They are all inextricably linked to each other:
This shouldn’t surprise us: high morale & motivation create high levels of engagement, which in turn delivers increased discretionary effort, lower sickness absence, and reduced staff turnover. (See my blog Seven Sure-fire Steps for Securing Engagement).
So the money question: how much should one invest in an effective morale intervention to secure a high ROI? Based on the figures above, interventions that address all four drivers of poor morale will produce savings of up to £15,000 per employee.
That’s in an average business – the numbers are obviously even more compelling where morale challenges are bigger and disengagement is higher.
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