The Cost of Stress in the Workplace
Kevin Stockslager, Vice President, Wray Executive Search
In this month’s Executive Connection newsletter, we published an Executive Summary of an Insight Report by Mia Doucet titled, “Ignoring the Personal Stress of a Key Executive Could Cost You Millions.” Mia analyzed the results from several studies, researched relevant literature on the topic, and interviewed 25 trusted business sources to analyze the true cost of executive workplace stress on the company and why so often the topic is ignored. What she found was that workplace stress amongst key executives was high and extremely costly to the company, little surprise given the personal and professional stakes at that level. Perhaps what was surprising was just how often the topic was ignored in the workplace and the astronomical costs of inaction.
The reasons for ignoring stress in the workplace all make sense. Oftentimes high-level executives hide outside stressors, especially ones resulting from personal situations, just like the rest of do from time to time. Not wanting to be viewed as weak or not being able to handle the pressure certainly contributes to the sweeping of this topic under the rug. However, while difficult to estimate, the cost is staggering. If a high-level executive is losing hours per day and/or operating at lesser efficiency, the value lost can add up to hundreds of thousands of dollars per year and have devasting effects on executive level projects, often times multi-million-dollar investments in the brand.
So now, what can companies do to address this issue? As has been stated for many years, building a company culture of openness and collaboration can reduce this stress, create a supportive environment, reduce burnout, and increase productivity. Several companies and executives have used executive coaching and training to alleviate stress and build a company culture. However, if underperformance continues to be a concern, a change is often required. In Mia’s Insight Report, our Managing Partner Bob Gershberg opines on the issue of retention in the workplace, noting that “we ought to retain our A and B players and it’s not a good idea to retain our C and D players. The costs of keeping an underperforming executive are tremendous. The cost of replacing is much higher.” Considering the cost of retaining an underperforming executive can range in the hundreds of thousands of dollars in terms of lost productivity, compared to a one-time search cost of $80,000, the answer sometimes becomes clear when considering the short- and long-term impact of underperformance.
Kevin Stockslager | Vice Presidentkevin.email@example.com(845) 863-5562 ——
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