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Why Businesses Should Treat Employee Burnout as a Risk Management Issue

By: Andrew Deen


Understand the Subtle Signs of Employee Disgruntlement

The business world has become increasingly aware of how employees feel on the job. Workplace burnout has become a prevalent issue — one that leads to many people seeking new employment. Can the way your staff feels be considered a risk management problem?

In this article, we examine how burnout impacts productivity and profits, and what business leaders can do about it.

Short Answer

Why should businesses treat employee burnout as a risk management issue? Because it is one. The mental and emotional condition of your workforce is significantly harder to quantify than other risks. Statistical analysis can tell you what percentage of your product is damaged or broken in shipping. It can’t tell you how Mark feels on his commute home from work.

Yet even though burnout is difficult to quantify, or to even define, it plays a significant role both in the emotional health of your staff and in what they are able to achieve during a working day.

For many years, the apparent business attitude has been that employee output is a nearly inexhaustible resource. For forty hours a week, your staff is yours to do with as you like.

Of course, there is nothing wrong with businesses trying to be as productive as possible. However, a degree of balance is necessary for facilitating a sustainable, high-achieving work environment. Simply put, fatigued employees won’t be as productive as happy, balanced ones.

Motivation Is Important

Among all the indicators of success, few are quite so substantial as that of motivation. A staff that sincerely wants to achieve something will be much more likely to do it than one that simply has to. The natural implication of this is that a work environment that can’t promote high levels of employee motivation is at risk to underperform relative to one that does.

But isn’t collecting a paycheck motivation enough?

Well. No. The motivation to continue making a living — i.e. collecting a paycheck —  is not the same as feeling motivated to produce positive outcomes for your place of employment. When a worker feels burned out they cannot force themselves into feeling motivated to outperform third-quarter sales figures.

In other words, a burnt-out employee may want to do their best work. They simply can’t force themselves to feel the motivation required to do it.


Waning productivity isn’t the only risk associated with employee burnout. Perhaps even more prominent is the risk of turnover. Naturally, when a workplace situation becomes untenable, many people will seek work someplace else.

The bigger problem? Turnover begets turnover. There are many reasons why. Let’s say Jane and Joe are workplace pals. Jane is happy at work. Joe is not. Joe leaves. Jane stops being happy at work. Jane leaves.

Scenario two. Your sales department benefits from a strong six-person team. Team member one quits very suddenly. Now five people are doing the work of six. Team member two quits from the stress. And so on.

Turnover is extremely expensive, both in terms of concrete costs: finding and training a new employee — and in abstract ones. How much revenue do you lose to productivity lags as you work to replace the missing staff member?

Bad Employee Outcomes

Burnout is also just really bad for your employees. People who are unhappy at work are at risk for a startling number of serious health conditions, including early mortality, diabetes, depression, anxiety, and general pain.

From a strictly human perspective, the vast majority of business leaders can be presumed to want better for their employees. In terms of business risk, the situation is equally clear. A staff filled with unhappy sick people can’t be expected to perform as well as a happy, healthy team.

Where burnout is prevalent, productivity lags, sick days increase, and things don’t get done the way they are supposed to.

The Solution

So, what’s the fix? As people become increasingly more aware of the risk of employee burnout, phrases like “company culture,” grow in prevalence. Workplace leaders all over the country are now looking for ways to make their staff as comfortable as possible on the job.

One of the clearest ways this has been facilitated is by allowing flexibility into the workplace. The pandemic played a large role in illustrating how many jobs can benefit from a heightened degree of options.

People once stuffed away in a cubicle found that they could do their work from home in less time, and still have the opportunity for things like a midday run, or picking their kids up from school.

Where this level of flexibility isn’t possible, there are still ways to reduce employee burnout. Provide your staff with mental health resources. Regularly gauge workplace satisfaction levels, and make an active effort to alleviate employee pain points.

There is no single way to reduce workplace burnout. However, by making a regular, concerted effort, your staff will feel more appreciated and perform better.

Published: August 11, 2022

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Andrew Deen

Andrew Deen has been a consultant for startups in almost every industry from retail to medical devices and everything in between. He implements lean methodology and is currently writing a book about scaling up business. Twitter @AndrewDeen14.

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