The role of traditional occupational health is evolving in many companies (see this feature here, and this interview with Jaguar LandRover here) re-stoking the debate about whether the function should be delivered inhouse, or outsourced, leaving the question on many companies’ lips: should we outsource OH or not?
Obviously the answer to this question will depend on the company and its particular circumstances, but we talked to some industry experts for their soundbites on the pros on cons of outsourcing versus inhouse delivery, and general ‘truths’ about the function and how it can work best.
Pros of delivering occupational health inhouse:
Su Chantry, Specialist Public Health Nurse & Founder, SKC Occupational Health Hub:
“This can be a good model financially. Inhouse OH understands the culture and its people much more. It’s good for smaller business or for those with distinctive risks because an OH specialist can become a subject expert.”
“The key thing about having an internal occupational health function is that it can lead to really good relationships with line managers, and a really good understanding of the different job roles and the health issues. I’d argue, too, that inhouse occupational health managers are more likely to make the correct recommendations first time due to their knowledge of the business.
I’ve experienced this first-hand: I used to work at Transport for London which had occupational health inhouse, all within the one building. They had doctors, nurses, counsellors and physios, all employed by TfL. So, it was a very convenient one-stop-shop for employees. But that worked so well because all employees were travelling in to the London Borough, so could all travel to this one location.
The advantages of inhouse occupational health is that you are very familiar with the company’s purpose, goals, agenda values, etc. Outsourcing means this familiarity is diluted.”
Sean Sullivan, Chairman, CEO and Co-founder, Institute for Health and Productivity Management (IHPM:
“I really don’t think it’s possible to have as good an occupational health programme when it’s contracted out. That’s assuming you have a good culture and you trust your people. Having it inhouse sends a signal to all employees that this is an integral part of the business.”
Cons of delivering occupational health inhouse:
“It can lead to isolated practice and risk of some boundaries being crossed.”
“It’s much harder when employees are spread all a wide geographical area.”
Another ‘con’ mentioned is that if you have an occupational health function inhouse, in order to get the best out of it, you really need to have a dedicated medical director who can oversee it and bring all the different parts together . This can be expensive and challenging to find the right senior person, who fits with your culture, to fill this crucial role. Quality, objective auditing of your own offering can also be a challenge.
Pros of outsourcing occupational health:
It can be cheaper; you don’t have to create an onsite clinic or employee clinical staff. It’s also easier to measure in terms of costs.
Increasingly, there are value-for-money solutions to access occupational health making it more accessible to smaller companies and start-ups (see Wave Case Study here).
By outsourcing it, the business can focus on its core objectives, and key strengths, with the supplier also able to focus on its core area of specialism.
It can be good for very large organisations.
Cons of outsourcing:
“Large occupational health providers steer away from the personal bespoke approach to workplace health and apply a business model to the OH provision . It’s an income generating model and the health outcomes can seem inconsequential.
The majority of large corporate OH provision can be driven by quantity not quality. This corporate model can feel like an impersonal approach and I have had a lot of feedback from HR that advice is generic and templates are standard and unhelpful. When I was working in a large outsourced company, I was an occupational health nurse robot and had no autonomy in my practice.”
“We’re very fortunate that we communicate regularly with our therapy providers (physiotherapy & mental health support) to come up with solutions together but you may get a provider where they’ll just provide the bare minimum, not understanding the importance of work on health or how the company works.”
Other cons mentioned include the fact that large companies often have procurement departments responsible for purchasing occupational health and they often don’t understand what they’re buying. If it becomes about driving down costs primarily, any advantages of taking on a specialist provider can be compromised.
Additionally, quality control of the provider can be challenging, flexibility can be limited and, as mentioned in this article, outsourced OH in particular can suffer from having a punitive image.
Neither is ‘Better’
“Whatever structure you have, it’s got to be in really good collaboration with other colleagues like HR and management. What’s important is providing the right organisational culture in which to grow your workforce.”
Dame Carol Black
You should share what is working for you (even with your competitors)
The Institute for Health and Productivity Management (IHPM) works with employers in several ways; it connects them with outside providers and resources and also with those which have their own inhouse OH service. It also focuses on creating opportunities where clients in the same industry – it has numerous oil company clients, for instance – can share what they do and what is working.
That’s one reason why it’s created an ‘Energy Summit’.
“That means others in the industry can pick up ideas about what they could do and they work collegially; that collegial nature is one of the reasons I like working in OH,” says Chairman Sullivan.
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