Four ways to unlock the strategic value of HR
Kelsey Rod, Dynamic Body Technology, and Marc Ashton, Decusatio, discuss how to make HR strategies count.
According to the World Health Organisation (WHO), depression and mental health issues cost the global economy over $1 trillion (R15 trillion) every year and this in turn manifests in harmful use of substances or alcohol, absenteeism and lost productivity.
In South Africa there is limited data on the exact impact on the domestic economy but in 2017, the London School of Economics looked at the South African economy and estimated that depression alone cost the economy roughly R232 billion in productivity.
As a percentage of Gross Domestic Product (GDP), South Africa was the highest in the world when the survey was conducted.
In 2016, Dr Renata Schoeman of the Psychiatry Management Group placed the figure at just under R41 billion.
More recently, a project undertaken by consulting group IQ Business found that at least 66 percent of office-based employees surveyed are experiencing extreme stress, anxiety and depression. This research had some interesting South Africa-specific insights including that 92 percent were concerned by the state of South Africa’s economy and the possible implications it would have for themselves and their loved ones, 54 percent reported that they were experiencing financial strain, and at least 69 percent were mentally affected by the state of poverty on the news and around them.
When we talk about “billions” of rand of economic impact, it is often hard to grasp the scale of these figures but for context the market capitalisation of JSE-listed retailer Spar with its 2,440 stores in South Africa is R31 billion and a figure of R250 billion is the equivalent of banking giant Standard Bank.
However you look at it, these are significant numbers.
How can strategic HR unlock this value?
The human resource function is often classified as a cost centre rather than a driver of economic or business value and over the last two years, organisations have been in survival mode and attempted to extract as much value as possible out of the fewest number of resources.
Here are a couple of ways to unlock this value:
- Get the right people doing the right jobs. One of the consequences of the economic slowdown under Covid-19 was organisations turning to generalists and consultants rather than developing and nurturing specialist talent.
- Whether you are looking at the IQ Business survey or the statistics out of the South African Depression and Anxiety Group, it is clear that South Africans are carrying a lot of stress which is being carried into the workplace environment. While workplace stress and mental health interventions are often perceived to be an expense line on the budget, consider how much you are potentially losing through a stressed and unfocused sales manager or an executive team who are pushed beyond their breaking point. Alleviating workplace and mental stress have been proven to deliver workforces who are more creative, focused and solution-oriented.
- Credit bureaus such as Transunion regularly publish financial data on the state of South African consumers and it does not make for pretty reading. The economic lockdowns have wrecked the financial positions of ordinary South Africans and it will take them time to recover. Employees who are constantly struggling with debt don’t make for a focused workforce, but there is a more fundamental reason to invest in the financial education of your staff.
- It is well documented that the average South African does not do the prescribed minimum levels of exercise and this results in a variety of health-related conditions. Discovery recently released a paper developed in conjunction with the University of Witwatersrand and Western University (Canada) where they looked at more than 65,000 Covid-19 patients. The study showed that regular physical activity reduced the impact of Covid-19 by up to 45 percent and the risk of death by 42 percent.