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The Cost Of Being Unhealthy-RedSeer Perspective On Productivity Loss Due To Lifestyle Choices

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The cost of being unhealthy
RedSeer perspective on productivity loss due to lifestyle choices.
Overall Productivity Loss? 04
No. of Employee at Immediate Risk? 05
Share of Affected Employees 06
Key Risk Factors? 07
Mo...
Overall
Productivity Loss?
Productivity loss due to health
and lifestyle habits of employees
cost ~INR 24,000 Cr every yea...
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The Cost Of Being Unhealthy-RedSeer Perspective On Productivity Loss Due To Lifestyle Choices

  1. 1. The cost of being unhealthy RedSeer perspective on productivity loss due to lifestyle choices.
  2. 2. Overall Productivity Loss? 04 No. of Employee at Immediate Risk? 05 Share of Affected Employees 06 Key Risk Factors? 07 Most Affected Age Group? 08 Productivity Loss by Risk Factors to Age Groups? 09 % of Employees at Risk? 10 Risk Factors across Age Groups? 11 Methodology 12 Assessment Framework 14 Framework for Assessment of Cost 15 TABLE OF CONTENTS The cost of being unhealthy RedSeer perspective on productivity loss due to lifestyle choices. 3
  3. 3. Overall Productivity Loss? Productivity loss due to health and lifestyle habits of employees cost ~INR 24,000 Cr every year to IT industry in Bangalore… Cost to IT industry in Bangalore due to Productivity Loss No. of Employee at Immediate Risk? Almost 22% of the employees in overall IT industry in Bangalore are at immediate risk of productivity loss due to poor health and lifestyle… Distribution of Health Score of Overall IT Industry in Bangalore of overall employee in the IT industry in Bangalore are at immediate risk of productivity loss due to poor health and lifestyle 1. Health score is the weighted health score of employees on various risk factors i.e. Physical Inactivity, Emotional & Mental Health, Poor Diet, Physical Health and Substance Abuse 2. Health score is defined on a scale of 1-5 wherein, 1 indicates worst health score and 5 indicates best health score 3. Employees with weighted health score less than or equal to 3 are considered as employees at risk of productivity loss IT Industry in Bangalore 1 2 3 4 5 1.5 2.5 3.5 4.5 7% of IT Revenue in Bangalore (USD 3.5 Bn) Share of Bangalore in IT Revenue Share of other cities in IT Revenue in India IT Revenue in India Share of Bangalore in IT Revenue in India Cost of IT Industry in Bangalore due to Productivity Loss 30% 70% USD 165 Bn INR 24,000 Cr Loss annually ~22% 5 4
  4. 4. Share of Affected Employees More than 80% of employees are at risk on at least one risk factor % of Employee at Risk on various Risk Factors Atleast 1 Risk Factor Atleast 2 Risk Factor Atleast 3 Risk Factor Atleast 4 Risk Factor Poor Diet, Physical Inactivity, Substance Abuse, Emotional & Mental Health and Physical Health are the 5 risk factors Key Risk Factors? Physical inactivity and emotional & mental health of employees are major factors for the cost to industry due to productivity lost Cost to IT Industry in Bangalore due to Productivity Loss by Risk Factors (% of total cost) % indicates share of various risk factors in overall cost to IT industry in Bangalore due to productivity loss % of employee at risk for a particular risk factor is calculated from total number of employee with score less than 3 for physical inactivity and Emotional & Mental health, while less than or equal to 3 for poor diet and physical health and score less than or equal to 4 for Substance abuse Physical Inactivity Overall Cost to IT industry in Bangalore due to Productivity Loss Physical Inactivity Physical Health Substance Abuse Poor Diet Emotional and Mental Health 25% 23% 21% 18% 13% INR. 24,000 Cr Loss annually 83% 50% 23% 8% 7 6
  5. 5. Most Affected Age Group? Mid-age group employees are contributing to major share of cost to the industry Cost to IT Industry in Bangalore due to Productivity Loss by Age Groups (% of total cost) Productivity Loss by Risk Factors to Age Groups? Mid age employees has higher contribution in productivity loss due to physical inactivity and physical, emotional & mental health 20-30 years 40+ years 30-40 years 29% 29% 42% • Employees in the age group of 30-40 years of age constitute 35% of the total workforce in IT industry and contributes to 42% of overall cost resulting from productivity loss • However, younger employees in the age group of 20-30 years of age constitute 50% of the total workforce and contributes to ~29% of the cost due to lower billing rates as compared to employees with higher experience % of overall cost to IT industry in Bangalore due to various risk factors % split of cost due to a particular risk factor across various age groups Cost to IT Industry in Bangalore due to Productivity Loss by Risk Factors and Age Groups Physical Inactivity Emotional & Mental Health Physical Health Poor Diet Substance Abuse 23% 26% 30% 30% 44% 41% 50% 33% 40% 33% 33% 33% 23% 20% 21% 29% 18% 30% 13% 20-30 years 30-40 years 40+ years XX % XX % 50% 38% 9 8
  6. 6. Risk Factors across Age Groups? Younger professionals have a higher risk from Poor Diet while Mid-age group has a higher risk from Physical Health While younger employees are more prone to risk of productivity loss due to poor diet and substance abuse Percentage of employees at risk of productivity loss due to physical inactivity and emotional health increases with age % of Employees at Risk? % of Employees at Risk due to various Risk Factors % of Employee at Risk on various Risk Factors Physical Inactivity Emotional & Mental Health Physical Health Poor Diet Substance Abuse 83% 50% 59% 33% 40% 30% 54% 30% 39% 43% 30% 23% 23% 19% 35% 20% 16% 18%17% 69% 67% 8% 8% 8% 25% Highest number of employees are at risk of productivity loss due to physical inactivity and emotional instability. While these two risk may not result in sick leave but it leads to loss of productivity while at work % of Employees at Risk due to various Risk Factors across Age Groups Physical Inactivity Emotional & Mental Health Physical Health Poor Diet Substance Abuse 20-30 years 30-40 years 40+ years 17% XX% XX% XX% 62% 26% 35% 25% 17% 25% 26% 35% 62% % Risk* employees – By Risk Factors Average % of employee at risk at due to various risk factors Average % of employee at risk across age groups due to various risk factors Highest % of employee at risk for a particular risk factor Least % of employee at risk for a particular risk factor Industry average % of employee at risk for a particular risk factor % of employee at risk for a particular risk factor is calculated from total number of employee with score less than 3 for physical inactivity and Emotional & Mental health, while less than or equal to 3 for poor diet and physical health and score less than or equal to 4 for Substance abuse * % of employee at risk for a particular risk factor is calculated from total number of employee with score less than 3 for physical inactivity and Emotional & Mental health, while less than or equal to 3 for poor diet and physical health and score less than or equal to 4 for Substance abuse 11 10
  7. 7. Methodology RedSeer has interviewed 500+ employees across 10 IT companies in Bangalore Total No. of Respondents interviewed: 500+ 26% 18% 45% 37% 20-30 years 40+ years 30-40 years 74% Male Female Split by Gender Split by Age Groups 13
  8. 8. Assessment Framework Assessment of overall health score of employee due to combined effect of various risk factors Health Score Risk Factors Description Weightage Overall Health Score Poor Diet Unhealthy eating habits such as eating too much junk food and eating less of fruits 22% Physical Inactivity Lack of regular physical activity such as exercise, running, playing sports, walking etc. 22% Emotional & Mental Health Lack of proper sleep and meditation resulting in emotional and mental stress 22% Physical Health Prevalence of lifestyle diseases and falling sick frequently 22% Employees with weighted health score less than or equal to 3 are considered as employees at risk Health score of employees have been defined on a scale of 1-5 wherein, 1 indicates worst health score and 5 indicates best health score Weighted average score of employee across various risk factors is calculated to assess the overall health score of individual employees Secondary Research Corporate Interaction Cost to organization due to following risk factors Employee Survey Employee Survey Secondary Research Corporate Interaction Framework for Assessment of Cost Assessment of cost to company due to productivity loss from various risk factors RedSeer has calculated the cost to organization for each risk factor taking number of employees at risk due to particular risk factor and productivity loss due to that risk factor RedSeer has calculated the overall cost to organization by taking summation of cost to organization due to various risk factors Cost to Organization due to a particular risk factor Overall Cost to Organization due to productivity loss Number of Employees in the Organization Poor Diet % of Employee at risk due to particular risk factor Physical Inactivity % of productivity loss due to Absenteeism and Presenteeism Emotional & Mental Health Billing Rate of Employees Substance Abuse Physical Health = = Σ X X X 15 14
  9. 9. Authors Disclaimer Ujjwal is an Associate Director at RedSeer. He is a big believer in the power of technology to disrupt the status quo. He specializes in due-diligences especially in the consumer internet space. Prior to joining RedSeer, Ujjwal co-founded and exited a healthcare start-up. He can be can reached at ujjwal@ redseerconsulting.com. He is an IIT Delhi alumnus Saurav is a Consultant with RedSeer and has 5+ years of experience in strategy creation in retail, cpg and ecommerce. He has an extensive experience in Business Consulting and has worked with brands and funds across the value chain. He is an IIM Calcutta alumnus Saurabh has 2.5+ years of experience in Consumer Internet, Retail, E-tailing Industry, etc. and has worked with major E-tailing, VC and PE firms in the E-commerce industry. He can be reached at Saurabh@redseer.com He is an RTU Alumnus Ujjwal Chaudhry Associate Director ujjwal@redseerconsulting.com Saurav Kumar Chachan Consultant saurav@redseerconsulting.com Saurabh Joshi Business Analyst saurabh@redseerconsulting.com While we have made every attempt to ensure that the information contained in this report has been obtained from reliable sources, Redseer consulting is not responsible for any errors or omissions, or for the results obtained from the use of this information. All information in this report is provided “as is”, with no guarantee of completeness, accuracy, timeliness or of the results obtained from the use of this information, and without warranty of any kind, express or implied, including, but not limited to warranties of performance, merchantability and fitness for a particular purpose. Nothing herein shall to any extent substitute for the independent investigations and the sound technical and business judgment of the reader. In no event will Redseer Consulting or its partners, employees or agents, be liable to you or anyone else for any decision made or action taken in reliance on the information in this report or for any consequential, special or similar damages, even if advised of the possibility of such damages. The information contained in this report is intended solely to provide general guidance on matters of interest for the personal use of the reader, who accepts full responsibility for its use. The application and impact of laws can vary widely based on the specific facts involved. Given the changing nature of laws, rules and regulations, and the inherent hazards of electronic communication, there may be delays, omissions or inaccuracies in information contained in this report. Accordingly, the information on this report is provided with the understanding that the authors and publishers are not herein engaged in rendering legal, accounting, tax, or other professional advice or services. As such, it should not be used as a substitute for consultation with professional advisers. 17 16
  10. 10. Flexible in Approach, Firm on Results © 2019 RedSeer Consulting Confidential and Proprietary Information www.redseerconsulting.com | Query@redseerconsulting.com Bangalore I Mumbai I New Delhi I Dubai I New York | Singapore Thank You! query@redseerconsulting.com

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