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Rocky Mountain Mutual Case Study

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Submitted By khusboo1162
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According to a study performed by researchers at Stockholm University and Karolinska Institute that was published in Journal of Occupational and Environmental Medicine and many other scientific studies we all read about in the newspapers, devoting a part of the work time to physical activity can lead to higher productivity and it improves people’s health.

Our company records of the past two years, when the fitness center was operational, indicate that there has been an overall decrease in employee absenteeism, reduction in employee medical costs, and an increase in productivity. The decrease in the medical cost can be seen as follows:

No./Percent of employees Users of Fitness Centre (in a week) Medical cost per person Total medical cost
25/10% >3 $100 $2500
62/25% 1-2 $300 $18,600
163/65% 0 $500 $81,500

Also, the users of fitness center missed on average only 6 days per year, which is half as many workdays as non-users missed. It didn’t miss my notice that not many people were using the facility. Hence I decided to institute a Wellness Program for my department. It has been eight months since the Program began and I can see a rise in productivity by 18 percent and sick days have come down by 5 percent. I am in talks with my colleagues in different departments and I believe that I can make them understand the importance of the Wellness Program and the fitness center. As and when the Wellness Program spreads to other departments there will be a major increase in the number of users of the Fitness Centre. Such an increase in the users will contribute to all the employees’ state of good health as exercise improves people’s health.

As our office is located in a fairly remote suburban area, our fitness center could act as an incentive to draw young and talented employees when we expand our business. Furthermore, there are no other fitness centers that are conveniently located near our company headquarters. It also gives us an edge since our competitors in the area do not have fitness centers. We have to be ahead of our competitors at all times. I realize that the fitness center is a very expensive undertaking but it is a very important motivational factor for the employees. They will not have much time after office hours to maintain their health and fitness. The center provides them with a perfect break from the rigorous work to rejuvenate them selves. That in turn increases the productivity of the company. The work that would take them 10 hours, now will only take about 8.2 hours.

I understand that your major concern is that there is no concrete evidence backing up the above statistics and claims. So I would suggest that rather than making a haste decision of shutting the fitness center (which is also just 3 years old and the cost to construct was alone a million dollars), you could give me some more time to provide you with the evidence required to prove that in the long run the fitness center will benefit the company and its employees.

Please find attached a sample questionnaire we can circulate among the employees to get more details about their exercising habits and also their opinion about the existence of the fitness center. I believe if I am able to prove the profitability and the advantages of the center to you through statistics you will be more likely to consider my point of view and rethink your decision.

Another idea to generate income from the fitness center for the time being could be to provide its services to outside people at a membership fee. As not many of the employees are using its services presently, we have ample space to accommodate other people. It is just a plan to meet the current expenses of the center.

I hope you will give a thought to the points I have made and reconsider your decision of shutting down the fitness center.

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