Please don’t complicate things with new information. I like the old (wrong) answer better. Entry 22 – 2007.
Sometimes we would rather not hear that our usual way of thinking is insufficient or incorrect. It is easier and more comfortable to stay put than to change.
A medical example
It is now known that most ulcers are caused by a type of bacteria called Heliobacter Pylori, the discovery of which won the 2005 Nobel Prize (1). Before the 1980s, it was well-accepted that a) ulcers were the result of lifestyle factors – such as stress, alcohol, and spicy food, and b) bacteria could not live in the acidic environment of the stomach. With that understanding of cause, the standard way to treat an ulcer was to control the level of acid produced by the body. When word came of a bacterial cause, it forced a difficult change in thinking for doctors and patients alike.
Believe it or not, patients and doctors were so entrenched in the old and wrong understanding of ulcers, standard medical practice did not adopt antibiotic treatment for more than a decade, leaving patients largely unaware. The delay in new treatment occurred despite its clear advantages—it was one tenth the cost, one tenth the duration and much more effective than ongoing acid-reducing therapy (2).
In science, as in all aspects of life, old belief systems die hard. The new paradigm regarding ulcers challenged long-held belief systems and coping behaviors of both doctors and patients. It was quite disruptive. Executives who popped acid-reducing pills and believed they worked themselves sick, wives who cooked bland meals and advised children not to stress Dad out, doctors who had learned the “proper” practice of acid-reduction, suddenly faced a very different world view. Even when it represents a clear opportunity for improvement, humans are not anxious to change their minds. (For a wonderful explanation of how changes in thinking occur (or don’t) in science, see Thomas Kuhn’s work (3).)
A health as human capital example
We find that paradigms are also tightly held in human resources and business. For example, we were asked recently to take part in a project to help businesses estimate the potential to reduce absences and lost productivity in their workforces. It was part of an initiative focusing on health in the workplace and finding ways to improve well-being while achieving positive business results. We were asked to partner with a team of decision makers, supporting the effort with our database and analytic expertise.
Excitedly, we volunteered what we know:
1) Health status influences business costs; however, it is quite difficult to significantly change a population’s health status using outside interventions and programs.
2) In contrast, economic incentives in corporate policies, which can be changed, seem to produce a cascade of measurable effects. First, these policies influence costs, and second, perhaps more importantly, they seem to affect how employees view and manage their own health.
When asked what (in the world) we were talking about, we listed evidence from well-designed compensation policies, paid-time-off policies, health-plan benefits, retirement benefits, and training policies. In other words, the structure of how companies pay people, reward people, and help them become more productive by enhancing their human capital. Our data show that when companies share rewards and responsibilities with their employees and invest in their growth, not only does performance improve, but so does attention to health. Bonuses affect employees’ ratings of health importance; salary reimbursement levels during paid time-off influences medical disability rates; health plan design contributes to workers’ compensation costs; and compensation practices affect health care costs. Our point: it’s all connected.
The response? Reluctance and frustration. Clearly, we were making something more difficult than it needs to be. Everyone knows that to reduce healthcare costs, we just need to make people healthier. Like fighting the acid to get rid of the ulcer instead of treating the bacteria really causing the problem, this project team was not interested in broad systems issues that increase medical utilization and discourage health protection. Instead, they just wanted to focus on what they believe to be the “real” causes of health costs, specifically related to the health status of workers.
So, unless we could help make a business case for continuing the old way of thinking by improving health status, as in medical interventions, our input was considered disruptive, not constructive.
Those pesky economic incentives
Any new perspective creates opportunities and threats, winners and losers. The discovery of a bacterial cause for ulcers presented a significant opportunity to alleviate, and oftentimes cure a very painful condition. It also provided opportunity for antibiotic manufacturers to build significant revenue. Conversely, the new “bug” discovery threatened the livelihood of anyone who sold stress-reduction services for ulcer sufferers as well as the market for antacid medications.
Our own underlying incentives will influence whether we embrace or refute a new discovery, whether historical or modern, whether in business, medicine or any field.
Case in point, we find that describing health in a broader human capital context also poses perceived threats. Current providers of health programs and medical interventions, insurance carriers, and those wedded to separate management and budgeting across corporate departments often find the all-inclusive human capital discussion worrisome. Just recently, we were asked if we could present our ideas but “leave out the part about economics and compensation, and focus on wellness.” The meeting organizers felt their audience, who had no influence on compensation practices in their organizations, would rather not hear about such matters. (We declined the invitation.)
If a company can fix many of its health and human capital problems by changing broad employment policies, some corporate department managers will have less control over turf and budget. Similarly, vendors selling the “problem” solely as a health problem, and the “solution” solely as a health solution will lose business. Accepting that many traditional employment arrangements between companies and employees actually discourage high performance and undermine health is frightening to those invested in the status quo. New answers, even right answers, are often the most disruptive.
You can pretend economic incentives are not driving health and business outcomes… but they are. Like pretending that the cause of ulcers is stress, ignoring reality only prolongs the problem.
Wanted: those not threatened by reality.
We will continue to seek out organizations whose incentives are aligned with, rather than threatened by, this new paradigm. And in those cases, we find like-minded decision-makers who actually spend less, but achieve better work performance, greater human capital growth, and lower costs.
A medical example
It is now known that most ulcers are caused by a type of bacteria called Heliobacter Pylori, the discovery of which won the 2005 Nobel Prize (1). Before the 1980s, it was well-accepted that a) ulcers were the result of lifestyle factors – such as stress, alcohol, and spicy food, and b) bacteria could not live in the acidic environment of the stomach. With that understanding of cause, the standard way to treat an ulcer was to control the level of acid produced by the body. When word came of a bacterial cause, it forced a difficult change in thinking for doctors and patients alike.
Believe it or not, patients and doctors were so entrenched in the old and wrong understanding of ulcers, standard medical practice did not adopt antibiotic treatment for more than a decade, leaving patients largely unaware. The delay in new treatment occurred despite its clear advantages—it was one tenth the cost, one tenth the duration and much more effective than ongoing acid-reducing therapy (2).
In science, as in all aspects of life, old belief systems die hard. The new paradigm regarding ulcers challenged long-held belief systems and coping behaviors of both doctors and patients. It was quite disruptive. Executives who popped acid-reducing pills and believed they worked themselves sick, wives who cooked bland meals and advised children not to stress Dad out, doctors who had learned the “proper” practice of acid-reduction, suddenly faced a very different world view. Even when it represents a clear opportunity for improvement, humans are not anxious to change their minds. (For a wonderful explanation of how changes in thinking occur (or don’t) in science, see Thomas Kuhn’s work (3).)
A health as human capital example
We find that paradigms are also tightly held in human resources and business. For example, we were asked recently to take part in a project to help businesses estimate the potential to reduce absences and lost productivity in their workforces. It was part of an initiative focusing on health in the workplace and finding ways to improve well-being while achieving positive business results. We were asked to partner with a team of decision makers, supporting the effort with our database and analytic expertise.
Excitedly, we volunteered what we know:
1) Health status influences business costs; however, it is quite difficult to significantly change a population’s health status using outside interventions and programs.
2) In contrast, economic incentives in corporate policies, which can be changed, seem to produce a cascade of measurable effects. First, these policies influence costs, and second, perhaps more importantly, they seem to affect how employees view and manage their own health.
When asked what (in the world) we were talking about, we listed evidence from well-designed compensation policies, paid-time-off policies, health-plan benefits, retirement benefits, and training policies. In other words, the structure of how companies pay people, reward people, and help them become more productive by enhancing their human capital. Our data show that when companies share rewards and responsibilities with their employees and invest in their growth, not only does performance improve, but so does attention to health. Bonuses affect employees’ ratings of health importance; salary reimbursement levels during paid time-off influences medical disability rates; health plan design contributes to workers’ compensation costs; and compensation practices affect health care costs. Our point: it’s all connected.
The response? Reluctance and frustration. Clearly, we were making something more difficult than it needs to be. Everyone knows that to reduce healthcare costs, we just need to make people healthier. Like fighting the acid to get rid of the ulcer instead of treating the bacteria really causing the problem, this project team was not interested in broad systems issues that increase medical utilization and discourage health protection. Instead, they just wanted to focus on what they believe to be the “real” causes of health costs, specifically related to the health status of workers.
So, unless we could help make a business case for continuing the old way of thinking by improving health status, as in medical interventions, our input was considered disruptive, not constructive.
Those pesky economic incentives
Any new perspective creates opportunities and threats, winners and losers. The discovery of a bacterial cause for ulcers presented a significant opportunity to alleviate, and oftentimes cure a very painful condition. It also provided opportunity for antibiotic manufacturers to build significant revenue. Conversely, the new “bug” discovery threatened the livelihood of anyone who sold stress-reduction services for ulcer sufferers as well as the market for antacid medications.
Our own underlying incentives will influence whether we embrace or refute a new discovery, whether historical or modern, whether in business, medicine or any field.
Case in point, we find that describing health in a broader human capital context also poses perceived threats. Current providers of health programs and medical interventions, insurance carriers, and those wedded to separate management and budgeting across corporate departments often find the all-inclusive human capital discussion worrisome. Just recently, we were asked if we could present our ideas but “leave out the part about economics and compensation, and focus on wellness.” The meeting organizers felt their audience, who had no influence on compensation practices in their organizations, would rather not hear about such matters. (We declined the invitation.)
If a company can fix many of its health and human capital problems by changing broad employment policies, some corporate department managers will have less control over turf and budget. Similarly, vendors selling the “problem” solely as a health problem, and the “solution” solely as a health solution will lose business. Accepting that many traditional employment arrangements between companies and employees actually discourage high performance and undermine health is frightening to those invested in the status quo. New answers, even right answers, are often the most disruptive.
You can pretend economic incentives are not driving health and business outcomes… but they are. Like pretending that the cause of ulcers is stress, ignoring reality only prolongs the problem.
Wanted: those not threatened by reality.
We will continue to seek out organizations whose incentives are aligned with, rather than threatened by, this new paradigm. And in those cases, we find like-minded decision-makers who actually spend less, but achieve better work performance, greater human capital growth, and lower costs.
We will also seek ways to share our ideas …including the parts about economics and compensation.
__________________________________________________________________
(1) Graedon, J., Graedon, T. Infectious ulcers win Nobel Prize. HealthCentral.com, September 17, 2005 (accessed October 18, 2007).
(2) Lynch, N.A. Heliobacter pylori and ulcers: a paradigm revised. Breakthroughs in Science Federation of American Societies for Experimental Biology, (accessed October 18, 2007).
(3) Forster, M.R. Guide to Thomas Khun’s The Structure of Scientific Revolutions. March 19, 1998, (accessed October 1, 2007).
posted by Wendy Lynch, Ph.D. at
9:15 AM
2 Comments:
I agree 100 percent that managing people requires "human capital managers" to take a systems approach to keeping their employees healthy, productive, and engaged.
Meaningful employment equates to a meaningful (work) environment. These M.E. factors are predicated on the existence of key enablers : fair compensation and benefits, safety, respect, two-way communication, appropriate training, and the opportunity for advancement, to name a few.
These enablers create the foundation for organizational and personal health and the promotion of healthy work. After all, that is the bottom line.
By
George J. Pfeiffer, at 9:04 AM
I agree 100 percent that managing people requires "human capital managers" to take a systems approach to keeping their employees healthy, productive, and engaged.
Meaningful employment equates to a meaningful (work) environment. These M.E. factors are predicated on the existence of key enablers : fair compensation and benefits, safety, respect, two-way communication, appropriate training, and the opportunity for advancement, to name a few.
These enablers create the foundation for organizational and personal health and the promotion of healthy work. After all, that is the bottom line.
By
George J. Pfeiffer, at 9:06 AM
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