Value of Investment (VOI) vs. Return on Investment (ROI)

+++ Battle of the Metrics! +++

The workplace wellness industry has been all a buzz lately with the prospect of moving from ROI to VOI to evaluate program efficacy. On the one hand, it is great that we are moving away from ROI – since the literature is clear that these programs do not produce a positive ROI and, in fact, do not even pay for themselves. The industry did not come by this decision easily however. As Soeren Mattke, senior research scientist of the non-partisan Rand Corporation, put it:

“The industry went in with promises of 3 to 1 and 6 to 1 based on health care savings alone – then research came out that said that’s not true – then they said ok we are cost neutral – and now as research says maybe not even cost neutral they say, but is really about productivity which we can’t really measure but it’s an enormous return.”


The burning question is will using VOI instead of ROI make a difference, and what will that difference be?

As a reminder, ROI has typically meant that organizations have looked to justify their investment in wellness programming based on financial measures of ROI driven primarily by health care cost savings. With VOI, on the other hand, organizations are looking to justify their investment based on factors like employee morale, workplace productivity, employee absence and workplace safety, in addition to health care cost. The theory is that there are likely to be savings in these areas that will move the needle to the positive with respect to the overall cost effectiveness of the initiatives.

The hope of the worksite wellness industry is that by expanding the measurement of the impact of these programs to these additional areas, it may turn out that they actually are worthy of the significant (in many cases huge) investments being made.

In fact, some experts have already claimed that using VOI will accomplish this goal. Unfortunately, wishful thinking aside, the embryonic literature on VOI is hardly conclusive on this point.

In the above mentioned article, the author cited a recent literature review of 51 studies in the “American Journal of Health Promotion” that evaluated the financial impact of workplace wellness programs which he stated “showed that worksite wellness programs make good business sense when implemented effectively.” With regard to the efficacy of VOI, this statement is problematic because:

1) These programs were evaluated using ROI calculations;

2) The review actually concluded that when the best methodology (Randomized Controlled Trials) were evaluated, ROIs were actually negative; and

3) Positive ROIs were only found when poorer methodologies were averaged with better methodologies – a tactic that is clearly problematic as other experts have pointed out.

(Think of averaging the Ptolemaic and Copernican theories of our solar system and coming up with the conclusion that earth revolves half way around the sun).

The Reality is Murky

The simple reality is that VOI will only be an improvement if the problem originally was with the ROI measure. If the problems are with the philosophy, the approaches and the programs themselves, changing the measure will not likely improve the situation. As more and more companies contemplate replacing ROI with VOI to justify their expenditures on traditional wellness programming, do we have a clue as to what the outcome might be?

The jury is clearly out on this, at least until we have some research (preferably not conducted by the companies providing the services) that demonstrates a difference. If we are talking about traditional 4P (pry, poke, prod and punish) “wellness or else” programs, however, we might already have some clues. In terms of the literature, we turn again to Dr. Soeren Mattke, referring to the impact to date of these programs in an article on the prestigious Health Affairs blog:

“Those changes are not large enough, and the relationship between health risks and spending too weak, to result in reduction of health care cost, let alone in return of investment.”

Remember that this refers to ROI research which just targets health care costs. How might this be different when the measures for 4P programs are expanded to VOI? We might get some clues from looking at the major components of these programs. Clearly it is unlikely that the lack of cost savings from biometric screens and health risk assessments will be altered much by this change. And weight-loss programs, contests and competitions, all of which consistently fail to produce sustainable loss for the vast majority of folks who participate, are not likely to magically become more effective.

But what about the somewhat “softer” measures that industry leaders are suggesting should be thrown into the mix like employee morale, for example? Does it make sense that threatening to punish employees for not participating in programs and/or fining them if they do not reach certain health outcomes is likely to have a positive impact on employee morale? If, for some reason, the answer to that question is not readily apparent, you might consider the findings from Princeton Survey Research Associates International that show these approaches are highly unpopular with employees. In a recent poll asking employees how they feel about these types of programs, it turns out that:

  • 62% believe it is inappropriate to require workers to pay higher health insurance premiums if they do not participate in wellness programs and,
  • 75% believe it is inappropriate to require workers to pay higher premiums if they are unable to meet certain health goals.

It’s difficult to imagine how subjecting employees to these programs could possibly have a positive impact on their morale. And given that 70% of US workers are not engaged at their work costing business in this country 100s of billions of dollars every year, it is also hard to imagine how this could translate into a positive VOI. In fact, page 10 of the recent, much heralded, industry-sponsored report from HERO actually lists employee morale as a COST of workplace offerings!

Moving Forward with Meaningful Metrics

In the long run, we might actually be better off staying with ROI if the underlying philosophy for employee wellness and wellbeing remains the same. When we throw employee engagement and other issues relating to the employee experience into the mix (VOI), it may actually make demonstrating value from traditional 4P offerings more difficult because:

  1. Employees are clear they don’t like being told what to do and/or punished if they don’t do it.
  1. The ever-increasing use of rewards and punishments may well “drive participation,” but…
  1. These tactics are more likely to decrease rather than increase employee engagement – and that is where the real savings are!

So if you don’t use ROI or VOI, how do you determine if your efforts to support and improve employee wellbeing are effective? First, it’s important to shift the underlying philosophy and approach to one that truly supports both organizational and employee wellbeing. Assuming that shift has occurred, it becomes a model where each organization honors its uniqueness and selects metrics that are meaningful.

If we use as a template Gallup’s five essential elements of wellbeing (we have added emotional wellbeing as a sixth element), we can begin to see how organizations might begin to select their metrics – by determining the two or three metrics in each element that will be most meaningful for understanding the current and evolving state of wellbeing at their company and whether they are moving in the right and desired direction. The following are some measures our clients have used to assess these six aspects of employee wellbeing:

  1. Career Wellbeing/Purpose: Metrics should reflect if people like what they do at work each day and if they have a sense of purpose. Some examples include:

— Culture survey results
— Engagement survey results
— Turnover
— Employee referrals
— Percentage of employees taking advantage of training and development opportunities
— Job mobility within the company (percentage of employees being promoted or moving laterally to new positions)
— Self-report satisfaction via employee survey

  1. Social Wellbeing: The quality of relationships people have in their lives. Some examples include:

— Forfeited or unused paid time off balances at the end of the year
— Self-report satisfaction via employee survey
— Participation at company-sponsored events and activities

  1. Financial Wellbeing: Has more to do with feeling financially secure than making a lot of money. Some examples include:

— Percentage of employees contributing to retirement plans
— Average percentage of pay employees contribute to their retirement plans
— Number of loans or early withdrawals against the plan
— Self-report satisfaction via employee survey

  1. Physical Wellbeing: What contributes to good physical health and having enough physical energy to get important things done each day? Some examples include:

— Lifestyle-related medical claims
— Musculoskeletal-related Workers’ Compensation claims
— Average sick days (if sick time is tracked separately from vacation time)
— Self-report satisfaction via employee survey

  1. Emotional Wellbeing: Metrics reflect a good sense of resiliency and work-life balance and having enough mental energy to get important things done each day.

— Mental health-related medical and disability claims
— Antidepressant and anti-anxiety prescriptions
— Self-report satisfaction via employee survey
— Stress and burnout

  1. Community Wellbeing: How connected people feel to the community in which they live. Some possible metrics:

— Percentage of employees taking advantage of volunteer time-off benefits
— Percentage of employees participating in charitable giving campaigns offered by the organization
— Self-report satisfaction via employee survey

Where Do We Go From Here?

The bottom line moving forward is that while it is possible that VOI will be an improvement over ROI, we are going to need real research to make that determination.

Given all the potential problems with substituting one metric for the other, we suggest this broader, more holistic and highly customizable approach might make more sense for determining the actual value of these programs for employees and the organizations in which they work.

For more on how to infuse organizational development and employee wellbeing into your workplace, read this FREE chapter from our book – “How to Build a Thriving Culture at Work, Featuring the 7 Points of Transformation.”

Jon Robison, PhD, MS, MAJon is an accomplished speaker, teacher, writer and consultant. He has spent his career advocating that health promotion shift away from its traditional, biomedical, control-oriented focus, with a particular interest in why people do what they do and don’t do what they don’t do. Jon has authored numerous articles and book chapters and is a frequent presenter at national and international conferences. He is also co-author of the book, “The Spirit & Science of Holistic Health — More than Broccoli, Jogging and Bottled Water, More than Yoga, Herbs and Meditation.” This work formed the foundation for one of the first truly holistic employee wellness programs — Kailo. Kailo won awards in both Canada and The United States, and the creators lovingly claim Jon as its father. Contact Jon at: or

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