Businesses can win the battle between work and family

ANN ARBOR—Some companies wage an ongoing war between work and family that ultimately undermines the goals of the organization and leads to higher employee burnout and turnover. But it doesn’t have to be like that.

Lynn Wooten, assistant professor of corporate strategy and international business at the University of Michigan Business School, says companies can win this war by making smart investments in family-friendly cultures, policies and practices that facilitate employees’ efforts to balance work demands with the obligations of personal life.

When this is achieved, she says, business organizations are positioned to reap a competitive advantage from their human capital through their ability to recruit, develop and retain a capable, committed workforce.

"Today’s knowledge economy demands investments in human capital and the creation of a work environment where employees can manage the boundaries of work and family, and thus excel at their jobs," Wooten said. "The ideal family-friendly programs address a broad perspective of an individual’s personal life, including not only care-giving to a spouse or child, but also community involvement and personal interests."

Family-friendly companies, such as American Express, Johnson & Johnson and Marriott, have established a wide range of programs designed to address the needs of their employees, Wooten says. Examples include non-traditional work practices and locations, flexible hours, unpaid family-care leave and on-site child-care centers.

However, making meaningful changes to an existing corporate culture is not easy, she says. It requires rethinking traditional notions of how work is structured and a strong, long-term commitment from company leaders who are willing to "walk the talk." Some firms have discovered that partnering with other organizations enables them to share knowledge, save costs and develop innovative work-family solutions.

"The redesign of work in the family-friendly organization entails structuring jobs so that employees have control over how, when and where work gets done, thereby alleviating tensions between private life and work life," Wooten said. "If this is not well-planned, employees will just manipulate the system to achieve the flexibility they need, but at the cost of unplanned absences, turnover and backlash from other workers."

Some benefits of investing in family-friendly organizations are intangible, but others noticeably impact financial performance, she says. Prior research has shown that companies with highly committed employees have a 112 percent return to shareholders over three years—compared to a 76 percent return for firms with low employee commitment and a 90 percent return for firms with average commitment.

In economic booms as well as recessions, family-friendly programs also save companies money by reducing costly employee turnover, Wooten says. Losing an employee to unwanted turnover, for example, can cost a firm as much as 105 percent to 200 percent of a yearly salary.

"Companies that are ready to make a change now will have ‘first-mover’s advantage’ for reaping the benefits of the family-friendly organization," Wooten said. "These organizations also should be recognized for their commitment to integrating bottom-line financial goals with their concern for the individual, especially since they are making investments in future generations and the overall well-being of their communities."

Wooten’s findings appear in a book chapter titled "Creating the Family-Friendly Organization: Successful Strategies for Winning the Battle Between Work and Family," which will be included in the Next Generation Business Handbook, scheduled for publication in September by Wiley & Sons.

Lynn Wooten’s faculty profile >