At the beginning of the year we sat down with Reward Guide to talk about the current barriers organisations are facing when it comes to employee benefits technology. Here’s what happened:
What do you see as some of the key barriers to employee benefits technology?
Feedback tells us that the initial outlay of setting up benefits technology – as opposed to ongoing fees – is the biggest deterrent, particularly for small and mid-sized organisations. It can cost upwards of tens of thousands of pounds for really complex systems.
Those initial set-up costs may also have put off companies of all sizes from carrying out market reviews and exploring what other providers can offer. With an existing provider, the cost is concentrated on the ongoing licenses, whereas switching to a new provider will incur upfront costs as well.
How is cost acting as a barrier?
Getting buy-in at senior level to invest in new technology can be a major challenge. Sometimes that will require collective commitment from a board, but in the case of a smaller company, that decision may rest with a single individual. Budgets may be tight, and the initial one-off cost may be hard to justify.
How can benefits technology providers and HR professionals combat these issues when they’re looking to invest?
There are a number of factors for both sides to consider. Technology providers could review their charging structures, and in particular initial up-front fees that are deterring businesses. They could also design technology so that it can be set up more quickly, resulting in a smaller cost to the provider and therefore a lower charge for clients. Creating standardised packages that are easy and simple to implement could also help to drive down costs. Users should be looking at a set-up of a few weeks for complex schemes, not several months.
From an HR perspective, it’s important to analyse the true cost of benefits practices. There are often unseen expenses, such as the cost of administrators, inefficient processes or poor integration between systems that create additional work. If you add up those hidden costs over the course of a year, they can be quite considerable. Then, it’s a case of assessing whether a change in process, or an investment in technology, could bring those costs down and free HR staff up to complete other tasks.
How is a lack of data insight impacting HR professionals?
We’re working in a world that’s forever changing and people are becoming used to new ways of interacting with technology in their everyday lives. One simple example would be the technique that streaming services such as Netflix use to recommend similar shows to someone, based on the content they are already watching. That is a much more efficient way of finding your next box set than starting a search from scratch every time you want to find something new to watch.
In a benefits context, that is analogous with using the data that you hold for your employees to look at trends. Those can act as an indicator of future needs and help HR professionals to decide whether they have the right types of benefits for individuals and for the business. It can also help to answer questions such as whether staff are aware of the benefits that they have available to them. Helping them to see choices that other people similar to them have made could also be useful.
Those trends can then be used to start to drive uptake through targeted communications. HR could send prompts to certain employees to help them understand what’s available and how it can benefit them. That in turn can be used to explain the true value of the benefits package that they are receiving.
It can also help employers to understand whether their benefits offering is competitive in comparison to others in their market and therefore support recruitment and retention.
Overall, better data insight will help HR professionals to create a road map for their benefits planning. It can enable them to keep their scheme relevant and valid by assessing what might be attractive to employees for the future, and also understanding whether existing benefits are still relevant.
This article was originally published in Reward Guide: Rewarding Tomorrows Workforce.