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Presenteeism: The Hidden Costs of Business

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(prez.un.TEE.iz.um) n

Presenteeism, a relatively unknown concept, is the complement of Absenteeism. It is defined as the measure of lost productivity cost due to employees actually showing up for work, but not being fully engaged and productive mainly because of personal health and life issue distractions. Currently, Presenteeism is estimated to be up to 7 ½ times more costly to employers than absenteeism. (1)

Statistically, Presenteeism rears its ugly head and shows itself for what it really is… a costly, somewhat unseen threat to employers. It is considered a threat because of its stealthy nature. The term itself is new, only recently added to our language. Considering the following alarming statistics, your business may be in danger.

• Presenteeism accounts for 61% of an employees total lost productivity and medical costs. (4)

• Presenteeism costs employers an estimated $2000/yr/employee. (10)

• Employees working at diminished capacity cost employers $250 Billion/yr. (8)

• 42% of employees anticipate elder care issues over the next five years. (2)

• 37% of employees with current elder care issues have lost work time per week, a total of (11) hours/wk spent. (2)

• On average, employees spent about 8 hours over the previous two-weeks off work, related to giving care. Some of that was paid, such as sick leave or vacation time, and some was unpaid. (5)

• One of the most commonly requested resources from EAP’s are legal services to cover estate planning, family law, divorce, real estate, bankruptcy and other non-workplace issues, accounting for 60-70% of all EAP requests from employees. (2)

• 64% of unscheduled absences are due to family issues 22%, personal needs 18%, an entitlement mentality 13% and stress11%. (9)

• 30% of employees come to work at least 5 days when they are too distracted to be effective. 28% of workers took time off for care giving and 25% took at least 1 hour/day to deal with personal issues. (7)

• Costs of absenteeism have risen from $610/employee/year in 2000 to an average of $789 per employee in 2002. (6)

• Of all of the expenses related to absence, unscheduled time off has the biggest impact on productivity, profitability and morale. (9)

• 49% of employees lose productivity at a rate of 1 hour or more/day due to stress, 40% lose 1-2 days/yr, 37% lose 3-6 days/yr, and 23% lose more than 6 days/yr of productivity due to stress. 44% of employees come to work 1-4 days/yr when too stressed to be effective, 19% of employees come to work more than 6 days/yr when too stressed to be effective. (3)

• 68% of employees take frequent “stress breaks” at work to talk with others. (7)

So, what can be done? Some will argue “Do nothing” and it will work itself out, after all, these issues have been a part of employee/employer relations for years. While that may be somewhat true, the actual associated costs of Presenteeism are rising, usually without the conscious knowledge of the employer. Those “hide your head in the sand” approaches to business operation usually spell d-o-o-m. Ignorance concerning any threatening, growing, unrealized operational problem will indeed be costly.

Potential Solutions: Employers must begin to encourage sick or distraught workers to stay home and get appropriate medical or professional attention before returning to work. Consider funding or partially funding an on-site day-care facility. There are many successful models to emulate. Consider expanding or modifying personal leave policies to better aid employees. Expand EAP programs to offer additional employee assistance in a wide range of emotional and family issues. This also has the unseen benefit of enhancing goodwill and demonstrating to employees that their employer cares about their concerns. While these actions may appear to be costly, they are actually an investment in your business.

Awareness is the key, the origin, the beginning of finding solutions. Study your operations in light of the previous statistics. Take actions to prepare for these inevitable situations and build their associated costs into your business model, rather than being caught by surprise at the end of the fiscal year with drastically reduced profit margins without a reasonable explanation. Smart business persons will become aware of the costs of Presenteeism and take action up-front to protect their business.

Bibliography and References:

1. 1999 study by The Employers Health Coalition of Tampa, FL
2. Risk and Insurance, March, 2004
3. Business Legal Resources, April 24, 2003
4. New Cornell University study, published in April 2004 of the Journal of Occupational and Environmental Medicine. A study of 375,000 employees over a 3-year period
5. Recent BankOne survey of employees
6. Dee W. Edington PhD, Director, Univ. of Michigan Health Mgmt Research Center
7. Elevated Stress Levels Lead to Presenteeism, by Richard Chaifetz, CEO of ComPsych, provider of EAP programs
8. Bulletin to Management, 12/5/2002, BNA Professional Information Center
9. Braun Consulting News, 2003 CCH Unscheduled Absence, Business Insurance July, 2000, and the US Bureau of Labor Statistics
10. Cigna Behavioral Health, April 26, 2004


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Graham Watson, Microsoft Redmond Senior Manager UGSS, importance of influencers, making IT communities work, key lessons, Windows Live and MS technologies

This is the next blog in the continuing series of interviews with top-echelon and renowned professionals. In this blog, I interview Graham Watson: Microsoft Senior Manager UGSS Microsoft Redmond. Graham talks about the importance of influencers, what makes IT communities work, key lessons, and future advanced technology to watch for. Graham demonstrates his great sense of humour in the interview which I know you will enjoy!

Two added notes:
Graham is elected as a “founding director” to the Global Industry Council (IP3-GIC), a first of its kind focusing on Computing as a Profession. “Global Industry Council Directors are specially nominated and invited to serve within the UNESCO-sanctioned body as internationally recognized luminary executives, thought leaders, and visionaries and for their strong history of providing substantive contributions to global business, industry, society, education, and governments.” “IP3 is establishing the IP3 Global Industry Council (IP3-GIC) as the principal forum within which leading ICT employers can engage with IP3 and influence the development of the global profession, identify and agree-upon standards, and nurture continuous improvement in alignment of those standards.” “It is the intention that IP3-GIC will be a prestigious organization comprised of recognized thought leaders from major organizations (both private and public sector) with acknowledged experience and expertise in information and communication technologies, and that an invitation and a subsequent seat will reflect the global third party validation that is only possible through a 50 year old body with UN roots.”

Graham is also participating at the World Computing Congress IP3 panel discussion on “IT Professional Certification – what does Industry want & why” – “The Panel discussion will connect senior ICT luminaries from around the world to give their views on professional certification.”

Cheers,
Stephen Ibaraki

Graham Watson is part of the Microsoft team responsible for the relationship between the technical professional community and Microsoft at a global level. He has worked for Microsoft for over seventeen years, starting in the UK as an enterprise infrastructure consultant. In all, he has over 35 years of experience working in the computer industry, beginning as a computer operator on a mainframe computer bigger than a house and probably less powerful than your oven. He's worked on machines where you could see each bit (core memory) and has actually seen a disk crash - through the floor of the machine room.

Although he's done everything from clean tape drives to write device drivers and design global messaging solutions for Fortune 50 organizations, his real passion is working in the technical community to help maximize the value individuals can get out of the professional community, as well as what they can contribute in return.

Graham is a fellow of the British Computer Society, and is a BCS Chartered IT Professional.

To listen to the interview, click on this MP3 file link

DISCUSSION:

Interview Time Index (MM:SS) and Topic

:01:24:
Can you profile how you got into computing - what triggered your interest?
"....I don't like the cold and wet! At school there was a choice of cross-country running or 'Computer Studies' using a new-fangled KSR-33 terminal to a computer at the Yorkshire school district headquarters. A couple of weeks later I was hooked, by the end of the term I was teaching the class Algol-68...."

:02:49:
Can you talk about your early years in the computing field and share some of your experiences?
"....Real pressure is spending 36 hours straight helping several hardware engineers trying to fix a problem with an international organization's system, only to look up and find the CEO looking at you and he quietly says, 'If you could fix it now I'd really appreciate it - we need to run payroll for the month'...."

:07:26:
What key lessons can you share in your current (and past) areas of responsibility that contributed to your success and that of teams you have led?
"....Unless you truly understand how the person you are talking to sees things, you really can't communicate properly....Enjoy what you do....It's important to take risks and fail occasionally....There is a very good reason you have two ears and one mouth - it's supposed to be so that you listen twice as much as you speak....Make sure you make others look good....When you make mistakes, own up before you are found out...."

:15:26:
Can you describe your current role and what you are accountable for? How are you specifically helping the IT worker and the community?
"....I'm responsible for the global relationship between Microsoft and the Technical User Groups, mainly through GITCA and INETA, and I'm also responsible for a program which works with key influencers within the technical community...."

:17:31:
What to you hope to achieve?
"....A strong, vibrant technical community which enthusiastically helps its members with their problems and aspirations and of which Microsoft is an integral part, both as a community member and as a community sponsor. One of the key things I think is that we reduce as much as possible the perception of 'us and them'...."

:19:54:
Which resources would you recommend?
"....People around you in the industry....TechNet or MSDN.....The general technical community....The Internet....People outside the IT industry...."

:27:41:
How do you make a group of people into a community that is sustainable, scalable, self-sufficient, and cohesive?
"....Only the group themselves can do that....What really makes the difference is a combination of enthusiasm and availability of the core members of the community....We can only help with things like publicity.....a little funding for initial meetings expenses, content, speakers, connections for mentoring, resources...."

:30:39:
Can you further define GITCA, INETA and PASS?
"....GITCA is the Global IT Community Association (primarily for the IT professional side).....INETA is the International Dot Net Association (primarily for the developer side)....PASS Professional Association for SQL Server (primarily for the database side)....Each are basically umbrella organizations which user groups or technical groups can join....Organizations like GITCA, INETA, PASS are very important because they raise the reach of the 10 or 20 person user group to the level where everybody can hear...."

:32:52:
The UN-founded IFIP (International Federation for Information Processing) organization is also like an umbrella where they have member societies and associations that belong to this international group. Graham talks about IFIP and IP3 (International Professional Practice Partnership).
"....We need to be able to recapture this perception of being expert, qualified, professional, and a key component of the business, and not just the technology but the business as well. In particular we have to be seen as a group of people who have business value rather than just being a business cost....What IP3 is doing is making sure that we have a globally recognized, professional set of standards where people can regain that perception of being a valued professional...."

:37:55:
Microsoft has provided their support for IP3. Can you comment more about that?
"....When you think about it, Microsoft's lifeblood is the IT professional and everybody else who uses their technology....IP3 is good for Microsoft because we believe IP3 is good for our customers. If it's good for our customers, it's good for us so we'll do anything that we reasonably can to support the profession....We are totally behind IP3...."

:40:46:
Why should the technical community care about Microsoft programs?
"....You as an IT professional of the technical community shouldn't care at all about specific Microsoft programs. What you should be caring about is what can you get out of the programs that we're running and what can you tell us to make us change our programs so that you can get more out of them...."

:42:38:
What defines an influencer and how does this impact Microsoft?
"....An influencer is someone who affects the opinions and actions of others....I think there are four key factors to being an influencer: ...Volume....Relevance....Reach....Reputation.... To be a world-class influencer you need to have all four of those...."

:46:23:
Why should IT professionals get involved in or with the community and how can they contribute?
"....First, to give something back and second, because there is so much you can get from participating....I love the idea of all these community-minded IT professionals wandering around the globe spreading random acts of unsolicited kindness to other people in the community...."

:49:03:
What specific key solutions and technologies should we be watching for from Microsoft and why should we care?
"....Some of the things that I personally find exciting from the Microsoft space at this point in time: Azure.... Silverlight.... the Windows platform (including the phone)....all the stuff going on in 'social computing'....An incredibly powerful set of technologies that we're working on...."

:51:45:
Graham comments briefly on Azure, Silverlight, and Windows Phone.

:53:31:
Can you say anything about the Windows Live environment?
"....The differentiation between Live being consumer and things like Azure, Silverlight, etc. being business, I think that's a very blurry line nowadays...."

:01:00:20:
Graham describes the Natal experience.
"....I think that Natal will open up so many possibilities that the opportunities are almost boundless....."

:01:04:11:
What are the most interesting questions you get asked and what are your answers?
"....The questions that get me excited are the ones which open up something I'm interested in, perhaps challenging me in ways I'd not considered....are the start of a stimulating discussion.... aren't judgmental.... and which the questioner is passionate about the subject....."

:01:05:37:
What are some challenges you were not able to overcome at the time and how would you do things differently now?
"....The biggest issues I've had have usually been around getting sufficient support for ideas (not necessarily my own), which I've considered both obvious and brilliant, and the problems have usually come from this perception leading me to assume that everyone else will be as 'on board' as I am...."

:01:07:37:
Past, present, and future - who inspires you and why is this so?
"....Number one - Stephen Hawking.....Number two - My wife, Ann....Number three 'to be announced'...."

:01:11:24:
Over your career, what are your top lessons you want to share with the broad audience?
"....Do one thing everyday that scares you...(from song lyrics which apparently came from a newspaper column)....Give others due credit....Write it down....It won't be as bad (or good) tomorrow...."

:01:13:00:
What phrases do you live by or find interesting?
"...'Any sufficiently advanced technology is indistinguishable from magic' (Arthur C. Clarke)....'He who dies with the most toys wins'....'Weltanschauung'...."

:01:14:57:
You choose the topic area. What do you see as the top challenges facing us today and how do you propose they be solved?
"....Note this is totally my personal opinion - actually everything I've said is just my personal opinion....'It's amazing to me how one thing never ever seems to come up in the discussion. There are too many people on the planet'....'How do we get drivers to indicate what they intend to do instead of what they have already started to do?'....'We are still a long way away from making computers truly useful for the "average" user....It's obvious that we really need to spend much more time with the older and less techno-savvy people who simply want to use a computer in the same way as knife and fork or pad of paper'...."






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