Why Your Organization is Losing Millions of Dollars and What Can be Done to Stop it

Why Your Organization is Losing Millions of Dollars and What Can be Done to Stop it

Written By Zach Stone, Chief Officer of Strategy at Red Kite Project/ Resiliency Building
Published on LinkedIn

Organizations are losing hundreds of billions of dollars every year. Are you asking the right questions, and taking the steps to stop it from happening in your organization?

morale, consultant, job

Over the past 15 years, I have had the opportunity to work with and train thousands of workforce and management employees. Regardless of the industry, workers tend to share many of the same criticisms of their bosses. Even though worker productivity has grown while wages stagnate or shrink, and even though companies that offer full pension and benefits have moved towards the single digits, most frustrations for workers stem from how they are treated, how they feel underprepared to deal with their job stress, overworked, under-supported, and don’t feel invested in.


One of the biggest mistakes that leaders make is to see employee engagement initiatives as too “touchy feely.”  Neglecting these areas will increase absenteeism, healthcare costs, turnover, behavior related write-up’s, lawsuits, and destroy customer interactions and satisfaction.  

jobs, promotion

Don’t believe me?

According to a 2013 Gallup workplace poll, over 70% of Americans say they are disengaged from their jobs. 

Baby Boomers have the lowest engagement rate at just 26% saying they are engaged, compared to 33% of generation Y. 

The U.S. economy loses “an estimated $450 billion to $550 billion annually because of widespread disengagement among American employees.”

Graph, jobs
Workplaces that meet “mental health and wellness” criteria have significantly higher performance than ones who do not.


The decreased productivity of each disengaged employee costs each employer $3,400 to $10,000 in salaries per year, according to Gallup research.

Unscheduled absenteeism costs between $3,000 to $3,600 per person per year. 


Cost of absenteeism for a company of 1,000 people  is $2.52 million a year.

Jobs, Bosses,

The total cost of unplanned employee absences exceeds 9% of payroll costs, taking into account both the direct costs (disability, salary continuation, etc.) and indirect costs, such as replacement labor expenses and lost productivity.


Teams with high levels of engagement sell over 20% more than teams with low engagement.


 Seventy percent of all job absenteeism is tied to stress-related illnesses.

According to the 2010 Harvard Wellness in the Workplace Study, there was a $3.27 return for every $1 invested in resiliency and wellness. 

To combat the fallout of these obstacles, bosses/leaders/managers/boards need to be asking key questions:

Do our workers feel respected and heard?

Are we helping them connect with a sense of purpose or meaning in their work? Do we help them see the role they play in the company-wide vision?

Do we engage them in around making decisions that directly affect them?

Do we regularly ask for feedback about our performance as leaders? 

Do we offer assistance to reduce worker burnout?

Do we provide training or wellness initiatives that support emotional and physical health? 

Are we trained to recognize these issues when they arise?



Case Study:  In 2010,  our firm, Red Kite Project was brought in by a Philadelphia-area company to address employee performance. We created an intensive 5 day training program geared towards building resiliency, engagement, and coping skills (for managing stress, conflict and violence.) After tracking employees for 18 months (vs. those who didn’t go through the intervention), we were able to reduce absenteeism among front line professionals by over 49% and reduce customer complaints by 41%.


Employees who feel supported, engaged, and respected are scientifically proven to be more resilient, perform better, boost their company’s bottom line, and lead better lives.  It’s not only the “ethical” thing to do, it’s the financially smart choice. “Rise above” these obstacles, and become a hero in your organization. 


Mercer, “The Total Financial Impact of Employee Absences,” October 2008

R.L. Weiseman, Personal Stress, Depression, and Workplace Performance

Gallup 2013 Workplace Poll 

Corporate Executive Board Research 2014

Harvard Business Review

Harvard Wellness Study 2010


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