Corporate Wellness: Case Study of Johnson and Johnson & Pepsi

The Dilemma

Businesses are very dynamic in the way that they are easily able to adapt and engage in new operation frameworks in order to improve their out turn and consumer satisfaction. Following the rise in education and exposure to the importance of mental health in the 21st century, many firms have made it their primary objective to improve their work place environment and culture in an attempt to heighten the overall wellness and productivity of their employees (Litchfield, Cooper, Hancock and Watt, 2016). However, despite these efforts, many wellness programs which have been implemented by firms have been unsuccessful, resulting in low returns for many businesses in the global economy (Frakt and Carroll, 2014).

So, what exactly are the current efforts being integrated by firms to create a healthy workplace environment and why have many of them been unsuccessful? In addition to this, is there even a relationship between a healthy working environment, wellness and greater success in the workforce?

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Although these questions are limited by the fact that there are many coinciding factors which influence and individual’s wellness and a firm’s success, I will indulge myself into the knowledgeable web browser and formulate an answer to solve this wicked problem.

The Determinants of a “Good” Working Environment

Firstly, before I take the first initial step in uncovering the efforts being implemented by firms to enhance the quality of various working environments, I must first familiarise myself with what a good working environment actually is – especially in the context of an everyday worker.

In a study conducted by Dr Lindsay McMillan OAM (2019), over 1000 Australian workers were surveyed to identify the different perspectives of a workplace environment. According to the study, 86% of Australian employees believed that a good working environment was one which increased employee trust, satisfaction, engagement and loyalty. This was closely followed by 85% of Australian employees who also thought that a healthy workplace environment was one which proactively addressed stress (McMillan OAM, 2019). In contrast, physical activity at work was viewed as being the lowest priority for many employees, with only 66% of Australian workers viewing physical activity as a necessity for a healthy working environment (McMillan OAM, 2019).

Clearly, a good working environment is one which actively engages with its employees, making them feel valued in their given industry. Stress is another component which needs to be addressed by firms – highlighting the important role wellness programs play in many enterprises. However, although fitness may be seen as a key component for employers (McMillan OAM, 2019), it is not viewed as favourable by employees.

The Leap for Corporate Wellness: Johnson and Johnson

Johnson and Johnson, founded in 1886, is a multinational corporation which focuses on medical equipment and supplies (Forbes, 2019). As this corporation has a large employee base of 135,100 workers (Forbes, 2019), corporate wellness has become a large focus for this firm, with many wellbeing and health programs being integrated to try and improve the experience of its employees (Bartz, 2018) – even before the 21st century when the words workplace and wellness were viewed as being an oxymoron.

However, Johnson & Johnson had always been a trend setter and in 1978 the corporation introduced its first wellness program, called “LIVE FOR LIFE” (Isaac, 2016). This program was aimed at making Johnson and Johnson’s employees the healthiest in the world through providing on-site employee voluntary access to nutritional education, stress management techniques, behaviour modification tools and much more (Bartz, 2018) – underlining the corporation’s strong incentive to improve corporate health and wellbeing.

Overall, more than 50% of Johnson and Johnson’s employees actively participated in the program at their given headquarters with the positive influence of the program being published both internally and externally (Isaac, 2016). According to these publications, within the first 5 years of the program, Johnson and Johnson companies which had integrated the LIVE FOR LIFE program obtained hospitalisation costs which were one-third the cost of Johnson & Johnson companies which chose not to include the LIVE FOR LIFE program (Isaac, 2016).

This can be attributed to the program resulting in improvements in blood pressure, weight control, cholesterol levels, and smoking cessation within employees – according to sources (Isaac, 2016). Evidently, this program has played an important role in improve the health and wellbeing of many Johnson & Johnson employees.

In addition to the program being beneficial to employees, it has also yielded a significant return to the employers. As a result of this program, employee absenteeism decreased by 18% - this accompanied with a reduction in health care costs resulted in Johnson and Johnson achieving a 1.7:1 return on its initial investment on the program (Isaac, 2016). This suggests that the inclusion of LIVE FOR LIFE program did provide (and still does) an economic benefit to the firm, which in turn would have improved the firm’s success.

This eager effort by Johnson and Johnson to try and improve the satisfaction of its employees has continued to this date, with many more programs being introduced. One of these includes a two-day program called “Energy for Performance” which was recently introduced by Johnson and Johnson to try and improve the resilience and energy of its employees at work (Bartz, 2018). This was achieved through the program allowing employees to identify the most meaningful aspects of their life in which they would prioritise. Consequently, the program boosted the productivity of 91% of the program’s graduates, further enhancing the growth of the firm (Bartz, 2018). These graduates also experienced greater levels of satisfaction within the firm as they were less likely to leave the firm over a 6-year period (Bartz, 2018).

The Problem Associated with Wellness Programs

However, despite the success of Johnson & Johnson, wellness programs aren’t as basic and easy to implement as they seem, they are complex and diverse and need to be included carefully to ensure that they don’t do more harm than good.

This is addressed by Carl Cederström and André Spicer in their book titled, “The Wellness Syndrome”. As detailed by the book, many wellness programs are becoming an overwhelming pressure on employees which are not only failing to improve the wellbeing of employees in the workforce, but are also deteriorating their enjoyment of life as a whole (Poole, 2015).

According to Cederström and Spicer, this syndrome is created by employers over idealising the concept of wellness (Poole, 2015). This can be seen by firms going to extremes to find the perfect diet, forcing employees to give up smoking and making employees wear self-trackers to monitor their sleeping patterns and daily activity in the quest to improve corporate wellness (Poole, 2015).

This is not only intruding on the personal lives of employees; it is demoralising and creates a toxic environment for workers to operate in. If employees fail to comply with these health precautions, they are reinforced with the idea of them being “lazy” and “weak willed” (Poole, 2015).

Ironic. Wellness programs deteriorating wellness – but its true, and it can happen if firms don’t take the necessary steps required to ensure that their program best caters the needs of its employees.

Pepsi Case Study

PepsiCo is another company which has implemented many wellness initiatives to improve the health and lifestyle of its employees. In 2003, the company introduced two wellness programs: one which focused on lifestyle management, and one which focused on chronic illness management (Paladinahealth, 2015).

Over a 10-year period, thousands of PepsiCo employees were examined to determine the effectiveness of these individual programs on corporate health and wellbeing (Paladinahealth, 2015).

The chronic illness program recorded positive results with PepsiCo saving $3.78 for every $1 invested on healthcare costs (Paladinahealth, 2015). The participants in this program also greatly benefited by saving $136 per month, in addition to having their health care admissions decreasing by 29% (Paladinahealth, 2015). This indicates that this program was very effective at improving the health of participating employees.

However, the lifestyle program received negative results with there only being a small reduction in absenteeism and there being no significant effect on the level of savings (Begley, 2014). This reinforces the idea that programs which aim to adjust specific behaviours of employees (such as diet, exercise, smoking, etc) have little to no benefit on corporate health and wellbeing – as mentioned by Cederström and Spicer.

My Understanding

From the gathered research presented above, I believe that wellness programs do have a strong influence on the employee and the success of an organisation. However, this can be for the better or for the worse.

It all comes down to structure of the programs and their fundamental role in the company. For example, the wellness program LIVE FOR LIFE illustrated by Johnson and Johnson took a proactive approach in resolving stress at work. Stress regulation was a key aspect which needed to be addressed by employers to create a healthier workplace environment, and as a result the program proved successful and saved the company millions. Furthermore, instead of forcing their employees to change their lifestyle habits, Johnson and Johnson educated their employees to encourage them to quite smoking and engage in healthier eating – making it the employees’ own choice.

However, when the concept of choice was removed, wellness programs failed to obtain positive results. This was seen in PepsiCo’s lifestyle management program which made employees change many of their behavioural habits such as smoking, physical activity and more.

In saying this, a healthy working environment should correlate to greater success and wellness in today’s society. It all comes down to the key word, “communication.” I believe if firms actively and effectively communicate wither their employees, they will be able to address what is important and vital to create a good workplace environment. In doing so, the employees will feel valued in their given environment which will increase their level of trust and loyalty towards the firm. This will improve the employee’s wellness and contribution within their given industry.

References

1. Bartz, A. (2019). Johnson and Johnson. This Healthcare Company Is Determined to Have the Healthiest Employees in the World. https://www.jnj.com/innovation/how-johnson-johnson-is-improving-workplace-wellness-for-healthiest-employees
2. Begley, S. (2014). REUTERS. PepsiCo's Workplace Wellness Program Fails the Bottom-Line Study. https://www.reuters.com/article/us-wellness-workplace-idUSBREA0510R20140107
3. Isaac, F. (2016). Johnson and Johnson LIVE FOR LIFE Program: Now and Then. https://www.researchgate.net/publication/11842975_Johnson_Johnson_Live_for_LifeR_program_Now_and_then
4. Forbes. (2019). #81 Johnson and Johnson. https://www.forbes.com/companies/johnson-johnson/#3d7b55254f91
5. Frakt, A, Carrol, A. (2014). The New York Times. Do Workplace Wellness Programs Work? Usually Not. https://www.nytimes.com/2014/09/12/upshot/do-workplace-wellness-programs-work-usually-not.html
6. Litchfield, P, Cooper, C. Hancock, C, Watt, P. (2016). NCBI. Work and Wellbeing in the 21st Century. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5129275/