Benefits technology has evolved greatly over the past decade, but it still has some way to go to fully meet HR and benefits professionals’ back-end administration needs.
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- Most employers consider technology to be instrumental in helping them engage with generations Y and Z.
- But providers have a long way to go to meet employers’ and employees’ needs.
- The benefits technology market needs consolidation.
Increased competition has led to a crowded marketplace overflowing with products and services that are claimed to ease employers’ administrative burden, and new market entrants are exacerbating the situation.
Ian Hodson, reward and benefits manager at the University of Lincoln, one of five attendees at the Employee Benefits/Lorica 100 Club thinktank debate in April, says: “We are finding that providers that have a specialist market niche, in childcare for example, are suddenly popping up offering cars and bikes because of next year’s changes.”
In autumn 2015, the government is introducing a new childcare scheme that will be administered solely by National Savings and Investments instead of existing childcare voucher providers.
Hodson adds: “Everybody is in everybody’s market and having to create technology for doing more.”
Thinktank attendees agreed that market consolidation would help to overcome this overcrowding and encourage providers to take a more joined-up approach to meeting the needs of employers, many of which are struggling to manage a multitude of benefits across several administration platforms.
Hodson says: “We end up with a bit of a warehouse approach because we work with so many different providers that we end up trying to protect employees from the experience of having to go through so many different websites.”
One solution is for providers to offer just one platform, he says. “And they would offer this without pushing their own agenda and would work with us to pull everything into one place,” he says, adding that he is increasingly having to hire administration staff to cope with the multiple systems his university uses.
“We are looking at our reward team and not bringing in staff that are really going to add value to our agenda, but thinking we just need more admin people to protect our employees,” he says.
Providers also need to develop their front-end technology further to help employers to engage and communicate with employees, which respondents to the Employee Benefits/Lorica100 Club research 2014 survey cited as a key requirement for benefits technology.
Most respondents (52%) to the survey said technology was instrumental in helping them engage with generations Y and Z over workplace savings.
Jackie Buttery, head of reward at law firm Eversheds, wants providers to consider single-sign-on in their technology offering. “We’ve got all these external providers bombarding us with user log-ons and passwords and there’s still resistance to single-sign-on, which I think is quite a turn-off for employees,” she says.
Employers also have a role to play in ensuring that the technology they introduce is helping, not hindering, their benefits agenda, and that it is not superfluous to the needs of the organisation or its workforce.
Neal Blackshire, benefits and compensation manager at McDonald’s Restaurants, says his organisation learnt this lesson the hard way after creating a CD-ROM-based total reward system in 1999, which was posted to all managers. “We ended up canning it because we soon realised that no one was looking at it,” he says. “Employers have got to give staff a reason to access information.”
Blackshire says McDonald’s has instead spent the past seven years investing in and developing Our Lounge, an online employee portal featuring information on everything from employee benefits and HR to workplace-based qualifications, in order to optimise employees’ need to access it.
But employers must bear in mind that employees’ attitudes to work and their organisation can also determine the success of technology, regardless of its excellence.
Eversheds’ Buttery says: “Employers can create these really sophisticated initiatives in reward in complete isolation from their employee engagement piece and how staff feel about the organisation they work for. Employers could be really amazed by what they have created, when actually, if an employee is earning the money but wanting to work somewhere else, it will struggle to engage them.”
Ed Airey, UK reward manager at insurer RSA, agrees. “There is no point in having the best app in the world if people hate working for us,” he says. “We are currently finding that all providers are trying to sell us is mobile apps, and there is absolutely no point in me going out to the workforce with those.”
This is because there is no value to employers in doing so, as it does little more than promote providers’ brands, says Airey.
War for talent
Accordingly, 100 Club thinktank attendees agreed that technology aligned to the needs of their organisation and their workforce is more important than having access to best-of-breed products and services, especially because of the increasingly important role technology is playing in helping employers compete in the war for talent.
The University of Lincoln’s Hodson says: “A huge factor in recruitment now is employers’ technology. We run intern programmes every year and technology is key in them determining what they think of us as an organisation. Employers have to consider that what they do with technology reflects on what new recruits expect them to be like to work for, particularly for the generations coming through.”
Hodson says the days are long gone of employers relying on benefits posters to promote their employee value proposition. New recruits, particularly graduates, expect far more sophisticated offerings, which extend to receiving two IT devices in their starter pack when joining the university staff.
“Recruits judge the organisation by this and now expect to see technology used in every area of the business,” he says. “Google and Apple have, dare I say, created a huge burden for us all.”