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The Impact Of Stress On Businesses And Organisations

I have written many articles on stress (including the symptoms, causes and actions to take to reduce stress, stress management tips and strategies, resilience and how to support people who are stressed) however I thought I would focus in this article on an area which is not often talked about - the impact of stress on businesses and organisations. When stress is discussed the focus is usually on the impact of the stress on the person who is stressed, however a person's stress will also have impacts on their work and their business. If a number of employees are stressed the impact on the business or organisation will escalate. In this article we will discuss the potential impact and also what action a business or organisation may want to take.

Here are some of the impacts that stress can have on a business or organisation:

Absenteeism, presenteeism and ill health. Employees who are stressed may be absent from work due to stress, they may come to work but not be able to perform their duties to the normal standards and they may suffer from other health problems developing from the stress (e.g. long term chronic, mental health and other conditions and potential addictions). These factors will significantly impact the business or organisation due to lack of resources, the loss of knowledge and experience and the impact of this on other employees. There may also be health and safety incidents as a result of stress.

Morale and motivation. The above will in turn have an impact on employee morale and motivation, both in terms of the employees who are struggling with stress and the employees at all levels in the organisation who have to pick up their responsibilities.

Staff turnover, recruitment and training. As a result of the above staff turnover may increase and experienced employees may leave the organisation. The business or organisation will then have to recruit new employees with the associated time and costs of this recruitment and training.

Productivity and efficiency. Employees who are stressed and coming into work are likely to be much less productive and efficient than usual and this combined with employee absences, low morale and motivation and staff turnover will have a negative impact on overall business and organisation productivity and efficiency.

Customer service. It is very difficult to maintain customer service levels with staff absences, high staff turnover, morale and motivation issues and low productivity and inefficiencies. Stress can therefore result in customer service issues and problems, with customer complaints and potential loss of customers.

Communication and relationships. Where employees are stressed another impact can be on communication and relationships in the business or organisation. People who are stressed can be angry, irritable and withdrawn, which together with low morale and motivation and high staff turnover, can impact team dynamics, communication within and outside the company and both internal and external relationships negatively.

Business and financial performance. All the above will result in a deterioration in the company or organisation performance, in terms of sales, profitability and cash flow.

So what can a business or organisation do to prevent or minimise the above impacts? Here are some ideas:

Understand the data. A good starting point for any business or organisation is to evaluate the level of stress of its employees by gathering data such as the level of absence, long term illness, staff turnover, Human Resources or Employee Assistance Program calls and health and safety incidents as a result of stress and softer data such as employee feedback, management experience, customer feedback etc. This can be done through surveys, group and team meetings and one to one meetings. You may also want to seek external help with this analysis.

Risk assess the business or organisation. Alongside the above it is a good idea to risk assess the organisation to understand the current situation in all areas (both what may be creating stress for employees and the impact of stress on the organisation).

Areas to consider include:

- The working environment such as the physical surroundings, equipment provided, and heating and lighting (e.g. a open plan working environment may be creating stress for employees due to high noise levels impacting concentration).

- The culture of the organisation such as support for staff, values and beliefs and management practices (e.g. Management not accepting that there are stress issues and not providing any support to employees or a practice of everyone having to stay until the boss leaves could be creating stress).

- How employees are treated such as clarity of job and role descriptions and objectives, communication on a team and one to one basis, training, expectations around working hours and deadlines and career opportunities (e.g. ambiguous and unclear job and role descriptions and objectives or lack of training or too much or not enough work for or responsibility given to an employee could be creating stress).

- Resourcing such as employing the right number of people to meet the company's requirements and having the equipment to do the job properly (e.g. employees may be stressed because the organisation is under staffed and they are working long and unreasonable hours).

- Scheduling and planning such as poor project planning or management chopping and changing their requirements of their employees (e.g. Unrealistic deadlines and work schedules can create stress for employees).

You will need to personalise any risk assessment to your business or organisation and may want to seek outside help to complete it. There is some useful advice available at the UK Health and Safety Executive website.

Support individuals with stress management. As an employer you can support your employees to prevent and manage stress. This may be through open conversations with line managers, providing Employee Assistance stress support services, stress management training (such as our online video based stress management course for business owners, directors and managers and listening to employees concerns and taking action to improve things for them.

Make organisational changes to prevent and reduce stress. The risk assessment will highlight areas that need to be improved or changed in the organisation in order to reduce or prevent employee stress. This could be anything from changing the culture of the organisation to recruiting additional staff. You can get some ideas from the areas mentioned in the risk assessment areas above.

Hopefully the above has got you thinking of the potential impact of stress on your business or organisation and what you can do to prevent and reduce stress.

Author: Liz Makin
Published: September 2017

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Through Makin It Happen - Coaching, Mentoring & Stress Management, Liz Makin provides personalised business coaching, business mentoring and stress management services to business owners, directors, managers and professionals. If you are looking for a business coach, business mentor or help with stress please contact Liz on 01780 765270 or email Liz@makinithappen.co.uk to arrange a free consultation session.


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