If we’re talking employee benefits, what comes to mind? A key item in your strategic agenda… or a low level operational issue to be managed by your HR managers?
Too often, it’s the latter. With many conflicting priorities, it is all too easy for employee benefits to be passed over by CFOs and HRDs and given instead to their operational counterparts.
To an extent, this is understandable. On the face of it, employee benefits can seem to be little more than a hygiene factor. Pension; life insurance; income protection. We provide them because we are legally obliged to, because we’ve always done so, or because our competitors do so. They are an additional component of our reward package: one which employees complain about when it is absent, yet barely notice when it’s there. As a result, we may come to see to see them simply as a necessary evil.
This presents us with something of a dichotomy. Though employee benefits are seen to be low level, our spend on them is anything but. In order to compete in the aggressive war for talent, increased levels of funded cover have become the norm. Organisations spend an average of 24% of payroll costs on benefits (Source: CIPD).
Is it not time for us, as strategic decision makers within our organisations, to take more of a direct involvement when it comes to forming and supporting the Board case around our employee benefits offering for the year to come?
Because, when we get it right, the value and ROI we can derive from the benefits we provide are substantial. Not only can we better attract key talent, we can also maximise their ability to deliver for us. The right funded healthcare options will minimise our employees’ time away from work and increase productivity all-round. We can use our benefits package to contribute to our CSR policy, supporting key tenders and facilitating supplier relationships. And, with a competitive benefits offering, we can directly reduce attrition, retaining employees for longer, and significantly impacting on our overall employee spend as a result.
Even where we have an existing benefits package in place, though we may have been involved in the initial scope and design, there is a risk that we have since stepped away, and are no longer maximising our return on investment. Using the right employee benefits software, implemented correctly, can remove inefficiencies from legacy platform costs and integration points, into one streamlined solution with minimal administration.
A global telecommunications business introduced a new benefits software package which delivered multi-million-pound savings, breaking even in less than three months. How? Through streamlining processes, combining three platforms to one, and removing over 40 integration points. In addition, 15 new benefits were added for staff (with no additional administration!) and there was an increase of take up for every benefit. All of this will result in further savings from staff retention and increased productivity.
What does all this mean? It’s time for your employee benefits offering to move up your strategic agenda. With ever-increasing demands on budgets, you should be continuously evaluating your spend on benefits, undertaking reviews of the market and of your competitors’ offering, and evolving your own package to maximise ROI.
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