What is this about?
This edition of Connections newsletter provides an important report produced by the well-respected business consulting and analytics company Forrester. The report examines 4 large clients of the Virgin Pulse Engage platform with 264,500 eligible employees and approximately 50,000 users of the platform. The report examines economic savings projections for both selected traditional ROI and selected VOI components which makes this a very unusual program evaluation report. The Report highlights a proprietary framework and methodology for risk-adjusted economic analysis developed by Forrester called the Forrester Total Economic ImpactTM methodology. All savings were risk-adjusted over a three year period. All 4 of the Virgin Pulse clients have used the Engage platform for several years.
Highlights from the Report include:
- Avoided cost of employee attrition equaled $9,048,242 .
- Reduced healthcare costs of $8,280,615.
- Avoided cost of fatigue related mistakes of $1,479,231.
- Avoided cost of sick leave absenteeism of $6,655,413.
- Decreased administrative costs of $5,489,776.
- Total program direct costs of $11,622,577.
- A cost/benefit ratio of 1:1.62 or an ROI of 162% for the 3 year period.
- An Net Present Value (NPV) of $19,137,500.
Why is this important?
This Report is important because it provides a detailed business-based rather than academic analysis of a virtual Wellness platform combined with incentives and it examines important traditional ROI and non-traditional VOI metrics. It is also important because it establishes a risk-adjusted analytic methodology that has business credibility. It is a conservative projection of economic return using newer Wellness technologies. This Report offers some excellent insights for reinstituting ROI methodology for today’s employee Wellness efforts that is driven by business realities rather than academic expectations.
What can you do with this document?
- First, skim the document for the major issues and findings presented by the authors.
- Next, identify where and when this information should be used to educate volunteers, staff, employees and managers.
- Next, determine what analytic methods outlined in the Report can be applied to your own employee wellness program ROI assessment.
- Next, determine how you might capitalize on the implications of these findings in the design and execution of your employee wellness program and implement them.
- Finally, review your progress periodically in developing a business-centric approach to ROI evaluation of your Wellness program.
In summary, this Report provides an important newer perspective on the economic analysis of employee Wellness programming and supports a much more strategic perspective on the role of these kinds of efforts in enhancing the Human Capital in our work organizations.