Will a focus on well-being produce sustainable progress?

1680784-poster-1280-health-and-happiness-indexHappiness happens to be a universally understood and valued experience.  Its pursuit remains one of life’s deeper impulses, the subject of every culture’s value system and an indicator of the quality of one’s life.  It also turns out to be vexing to measure.

Bhutan, in 1972 was one of the first countries to embrace happiness as the singular measure of a country’s progress or well-being. Yes, not Gross Domestic Product, the output of a countries business activities, but Gross National Happiness, a measure of development activities with values. The distinction to examine quality not just quantity as a measure of progress represents a more holistic, purposeful understanding of what enriches our lives. This interpretation is not new. Newer measurement techniques that enhance the consistency of qualitative metrics  challenge the supremacy of quantitative measures. This additional data also questions the obsessive focus on economic growth as a singular proxy for progress.

Two recent news stories made me realize the subtle changes percolating within US companies as they find their way to accommodate increasingly different interpretations of progress by measuring happiness.  The stories skippped over the real challenges of measuring anything.  Before I share the examples, I invite you to take a moment to consider how well-being has been defined and measured with respect to success, apart from growth.

Performance Measurements

Its widely acknowledged that GDP is only one yardstick of economic performance. Its’ measurement simplicity provides a comparable indicator not of social progress but the relative market value of all goods and services produced in an economy. For a period up to the financial crisis , globalization and increased mechanization, if anything, increased society’s appetite for growth. The arrival of the economic slow down and the onset of the European debt crisis produced very different reactions across the Atlantic. In part, it was not differences in experienced well-being or life expectancy but differences in people’s reported happiness and life satisfaction. (See page 61-62 http://issuu.com/earthinstitute/docs/world-happiness-report#)

The Guardian shared mounting evidence that, beyond a certain point, greater prosperity does not make people feel any better. Over the past 50 years, Western standards of living have soared, yet survey after survey shows that Britons and Americans are no happier now than they were half a century ago. (See Gallup research below.)

The slow awakening of western economies to the Easterlin paradox, opened debate on its efficacy and questions the nature of “the more.” Perhaps, government’s should be held accountable to different standards? Societies may need to consider how they generate growth and prosperity as well as how its shared. A measure of a Country’s wealth could take into account something other than just material prosperity and consider the well-being of its inhabitants. On the human level, well-being takes into consideration a desire for increased income, but it also encompasses our constant search for more feeling, more insight and more knowledge.

The focus on well-being has emerged as the compromise between economic definitions of success and the more ambiguous definitions of happiness. The British Labour economist, and co-editor of the first UN World Happiness Report in 2012, Richard Layard has looked at how better mental health can improve our social and economic life. He suggests that well-being depends on three things: family relationships, satisfaction at work and strong communities: “Many policies to drive up income harm precisely those things from which we derive our quality of life.”

The relevance of well-being as a metric however must consciously align more with happiness than the ethical notions of a good life and that creates confusion for anyone seeking to measure it.

Measuring Well-Being

Editors Michael Eid and Randy J. Larsens in their book, The Science of Subjective Well-Being, elaborate on the psychological and ethical meanings and associations challenge the use of well-being and happiness as objective outcomes. For example, a classic utilitarian perspective views happiness as the aim of social choice. “Such arguments tend to grant the identification of happiness with pleasure, but challenge the idea that happiness should be our primary or sole social concern, and often as well the idea that happiness is all that matters for well-being.”

Confusing isn’t it?

The Economist intelligence unit shared Gallup’s deeper research into this topic that further demonstrates the indirect and complexity of relationships that make defining well-being challenging.

“… where other factors intervene, and where it can be difficult to distinguish correlation from causality. It also reflects a shortage of meaningful, practical and comparable metrics. We are still in the early stages of turning people from a cost into an asset to be measured and valued on the balance sheet.”

Gallup’s extensive research identified five “universal, interconnected elements that represent what people across nationalities, faiths and cultures look for in life and what causes them to thrive.”

  • Career well-being–how individuals occupy their time and like what they do each day.
  • Social well-being, having strong relationships and love in one’s life.
  • Financial well-being, effectively managing economic life to reduce stress and increase feelings of financial security.
  • Physical well-being, having good health and enough energy to get things done throughout the day.
  • Community well-being, a sense of engagement and involvement with the area in which you live.

CASE One

Coca Cola
Vauhini Vara, May 2014 profile for the New Yorker of Coca Cola‘s recent foray into tangibly promoting Happiness. Simultaneously they were promoting their brand. This is not a new venture or tactic for Coca Cola. The expansion of their thinking about happiness beyond pleasure follows along the lines of psychological well being. As Wendy Clark, an SVP at Coca-Cola explains:

“happiness itself is a universal concept that makes sense to people from all kinds of backgrounds. “We understand the drivers of happiness—things like being active, being together, trying new things,” she said. “We have these constructs that are universal human truths about happiness. What we’ve got to do is then bring those down to each market so that they’re translated in ways that are locally relevant.””

Take a look if you like at the short video here:
https://www.youtube.com/watch?v=zlA9tXYxD8g

Before you get too happy, I need to mention that Coca Cola took them down after a month. Vara’s article elaborates the double-edged sword that any discussion of happiness and well-being cuts. Surely well-being matters but that definition is not universally interpreted as purely psychological, as it also invites ethical debates.

“Open Happiness,” the slogan sounds innocuous but to Nicholas McGeehan, a Gulf researcher for Human Rights Watch, the ad was “odious….If this was two hundred years ago, would it be appropriate for Coke to do adverts in the plantations of the Deep South, showing slaves holding cans of Coke?” he asked.

Coca Cola’s remains accountable primarily to its shareholders and not to society, the outcomes it achieves through its focus on well-being support its growth. The positive ratings the commercial in question received no doubt paid off  on their intentions and will lead them to continue these efforts.

Case Two

The Business Roundtable, an association of Chief executive officers leading US companies released a report this week calling for policy changes to the Affordable Care Act. Worker’s health and insuring them rank near the top among all cost drivers to American companies. Federal incentives promote the creation of Wellness programs, that when effectively designed, increase the psychological well-being of employees, and may improve the physical health of employees too. The impact of these programs require the creation of behavioral incentives that align with indicators associated with the desired results.

Notice the distinction between wellness and well-being, psychological vs. physical. Which outcome matters and produces the value an organization seeks?  Organizations have much greater experiences tracking growth, or production output as explicit measure of a company’s impact.  This experience does not readily translate into creating measures or indicators of cause and effect that outcome based wellness programs require.

What reasonable, alternative standard indicators support the results that wellness and well-being define? The interdependence and complexity of definitions identified by Gallup and Layard prove challenging for many corporate wellness program designers to measure. The Federal government and its incentives incorporate multiple objectives.  These rules seek to protect individual privacy, freedom of choice and wish to encourage alternative behaviors. Encouragement isn’t realization. The programs and outcomes being defined as well as the indicators used to incent change remain up to individual organizations. The business roundtable complaints are really misplaced, what they need is more experience in program design.

Summary

Incorporating well-being into your strategy shows great promise for delivering growth; however the definition you assign may not be universally understood. What you choose to measure should align with your organization’s values and your incentives for employees align with results their actions definitively produce.  If the evidence for cause and effect is too loose, chances are the incentives will not produce the outcomes desired. Be careful to construct outcomes that are within an individual’s range of time and ability.

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