It pays to reduce stress Featured

8:00pm EDT October 26, 2008

Do you think employees leave your company for better pay or more robust benefits? If you answered yes to that question, then you aren’t alone. According to the “2008 Global Strategic Rewards Survey” conducted by Watson Wyatt Worldwide, work-place stress is one of the top reasons employees say they leave organizations, but stress doesn’t even register as one of the top five reasons employers cite as causes of employee resignations. The survey demonstrates that organizations applying an integrated approach to reward and manage talent have an advantage in attracting, engaging and retaining the talent they need to succeed in their markets and outperform peers.

“Some of the myths that employers subscribe to are the reasons why employees come and go,” says Laurie Bienstock, U.S. practice director for Strategic Rewards for Watson Wyatt Worldwide. “Once they understand the impact of stress in the workplace, employers can reshape their employee value proposition and take steps to attract and retain top performers.”

Smart Business spoke with Bienstock about reducing workplace stress.

What are the top causes of workplace stress cited by employees?

According to the survey, employees are most stressed about the day-to-day challenges associated with their jobs, more specifically the increasing expectation to do more with less. Here’s what employees mentioned as the most frequent causes of stress:

  • Job definition — Unclear or unrealistic performance expectations cause stress, along with unrealistic workloads, inadequate training and poorly defined work processes.

  • Work group environment — A lack of teamwork and/or a lack of staff to perform their job duties create workplace stress.

  • Supervisor — Employees were split about how supervisors contribute to work-place stress. Low performers said their supervisor was a cause of workplace stress whereas top performers more frequently cited poorly defined work processes, not their supervisor, as a reason for stress.

In times of economic uncertainty, it’s even more important to ensure employees are engaged and have the resources needed to do their work. If organizations are forced to reduce their work force, they must be careful not to expect the employees left behind to do the jobs of those who have left — this creates excessive stress and may impact retention, particularly as the economy rebounds.

What actions have organizations taken to combat stress and which are most effective?

Organizations report taking these steps, with some being more effective than others:

  • Strengthen performance management. Clarifying job definition and defining realistic performance expectations through their performance management systems is viewed as highly effective in reducing stress, according to more than half of the survey participants.

  • Improve management communication. While many companies have instituted more frequent management communication around corporate goals and the company’s performance, the tactic was not reported as highly effective in reducing stress.

  • Re-engineer job processes. Re-engineering work flow and processes was highly effective in reducing stress.

  • Improve training. More than half of the surveyed companies increased the availability of employee training, but training was cited as one of the least effective methodologies for combating stress.

  • Flexible work schedules. While almost 60 percent of organizations indicate they are making it possible for employees to have a healthy, comfortable balance between work and personal lives, only 50 percent of employees agree. Flexible scheduling is the most common tool employers are using to facilitate work-life balance, with work-at-home/remote policy and adjusted staffing levels common around the world, as well.

Why is an integrated approach to rewards and talent management effective in reducing stress?

An integrated approach ensures that the programs and processes in place at your organization align with your business strategy as well as the needs of your current and future work force. This includes creating and living up to a compelling employee value proposition. By implementing a holistic approach to rewards and talent management that drives business results, aligns pay with performance, promotes healthy work-life balance and integrates employee learning and succession planning, employers drive employee engagement (which reduces stress) and achieve higher productivity.

Are there other benefits for employers?

Employers benefit from other soft cost reductions as a result of lower employee turnover such as decreased recruiting and retraining costs and sustained productivity levels. According to the survey, companies that take an integrated approach to reward and manage talent are less likely to experience problems attracting critical-skill employees (20 percent less likely) and top-performing employees (25 percent less likely); have less trouble trouble retaining critical-skill employees (33 percent less likely) and top-performing employees (18 percent less likely); and are 18 percent more likely to be among the top financially performing organizations.

LAURIE BIENSTOCK is the U.S. practice director for Strategic Rewards for Watson Wyatt Worldwide. Reach her at (415) 733-4311 or