On November 11, 1998, The Washington Post reported that “productivity gains are holding off a major slump” in the U.S. economy. Citing a study released by the Labor Department, the paper reported that U.S. productivity— measured as economic output per hour of work—rose at a seasonally adjusted 2.3 percent annual rate in the third quarter of 1998. Further, The Washington Post reported that the increase brings the rate of growth close to 2.0 percent annually— about twice the rate of productivity growth from the mid-1970s to the mid-1990s. What accounts for such a dramatic improvement in productivity over the past few years? Economists believe that growth can be attributed to the billions of dollars spent on new technology and capital investment. But, according to the same economists, that is only part of the story. They cite anecdotal evidence that companies are discovering “new ways to get more output from their workers and the machines they use.”
How do companies get more productivity from their workers? How do they define productivity? How do they track and measure improvements in health and
productivity? And finally, how do they evaluate the results of their efforts? These were the questions asked in the 1998 Health and Productivity Management (HPM) consortium benchmarking study, conducted by the American Productivity & Quality Center (APQC) and The MEDSTAT Group (MEDSTAT). This report summarizes findings from the consortium benchmarking study, which focused on the measurement of worker productivity as it relates to individual and organizational health. The study team sought to identify best-practice companies that employed scientific measures of HPM and found ways to connect these measures directly to the overall corporate mission. We asked, “How do these companies advance the concept of HPM so that it is no longer viewed as ‘intuitive’ but is instead supported with hard data rather than anecdotal evidence?”
The aims of this project were threefold:
- to learn how companies define work force productivity and how productivity is
linked to activities performed by health and productivity management functions
within these organizations,
- to identify innovative methods for capturing and displaying key HPM measures
in a “dashboard” or “report card” format, and
- to surface methods used by best-practice organizations to document cost/benefit and positive return on investment (ROI) for their HPM initiatives.
Productivity Measures (Both Direct and Indirect)
- Methodology used to operationally define work force productivity
- Process used to develop this productivity methodology
- Metrics (standard vs. innovative, direct vs. indirect) used to measure work force productivity
- Degree of automation used in measuring productivity
- Techniques for leveraging productivity measures within the organization
- Creative mechanisms used to report changes in productivity
- Process used to determine which key productivity measures to report
- Areas of the organization (functional areas, programs, etc.) responsible for monitoring and reporting changes in productivity
- Areas of the organization (functional areas, programs, etc.) supplying data and information for the measurement of productivity
- Process used for disseminating productivity reports
- Degree of automation used in reporting productivity
Financial Measures of Success
- Rigorous methodologies used to determine the impact of HPM investments,
specifically return on investment methodologies
- Rigorous research and evaluation methods used to determine the impact of HPM
on the organizational bottom line
- Areas of the organization (or outsourced function) charged with measuring the
financial impact of HPM on the organization
- Confidence in the financials, methodologies, and metrics used to determine
HPM’s impact on the organization
The findings listed below represent the general themes uncovered as a result of
site visits at best-practice organizations and supported by data collected with a quantitative data collection tool and relevant external research in this area. The report covers each of these key findings in detail. Additional information is provided throughout the report in the form of organizational examples.
Section One: Direct and Indirect Measures of Productivity
Section Two: Report Cards/Dashboards
Section Three: Financial Measures of Success
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- Sponsor and Partner Companies
A listing of the sponsor companies in this study, as well as the best-practice (“partner”) companies that were benchmarked for their innovation and advancement in the management of employee health and productivity.
- Executive Summary
A bird’s-eye view of the study, presenting the key findings discovered and the methodology used throughout the course of the study. The findings are explored in detail in following sections.
- Key Findings
An in-depth look at the eight key findings of this study. The findings are supported by quantitative data and qualitative examples of practices employed by the partner companies.
- Partner Company Profiles
Background information on the partner companies, as well as their innovative health and productivity management practices.
Metric data about participants’ health and productivity management programs.