Trend in benefits management is toward carefully planned efficiency and synergy

By: Bill Zolis

I’m often asked, especially at this time of year, about emerging trends in benefits management, what challenges are on the horizon and what opportunities there may be to make progress. 

From what I’m seeing in the industry and hearing from clients, I’d say that a recurring theme is a greater emphasis on two big-picture concepts. First, what I would call efficiency of benefits – how well any given element of the benefits plan achieves an identified goal; and, second, synergy of benefits – how well all the benefits work together to achieve our overall goals. 

Let me explain what I mean. 

The focus of long-term planning has tended to be on the fundamentals: getting the most and best possible benefits for plan members on the one hand, while managing the overall costs as efficiently as possible on the other. 

Getting the most bang for your buck, in other words. 

Nothing wrong with that. But when we talk about efficiency of benefits, we’re really taking a step back and asking ourselves what it is that we really want to achieve and then looking at how we manage benefits in terms of how well they help us reach those goals. 

We can look at each individual element of the benefits plan, first in terms of the goal we want to achieve and, second, in terms of how it functions synergistically within the overall plan. 

Let’s look at a few of the goals of benefits plans. 

Recruitment: There are many trends in today’s workforce that make recruitment a major challenge for many employers. There is a generational change in attitude toward employment and what people expect when they start a new job. There is intense competition for qualified and experienced people in many fields. Job applicants now look at the overall package on offer before deciding to accept a job.  

So, the goal here can be identified as offering an attractive and competitive benefits package to help attract the best talent. 

Retention: Employees at all levels, but particularly those with advanced technical skills, are more mobile than ever before. Surveys consistently show that half or more of employees are either actively looking or are at least open to the idea of changing jobs. Many younger workers think that three to five years is as long as they want to work for any one employer.  

The goal, then, has to be make sure employees are aware of the value of their benefits and confident that those benefits are working for them. 

Healthier people: Fundamentally, all or most of the benefits that plan sponsors provide are designed to improve the health and well-being of employees. Whether it is access to care that they might not otherwise be able to afford, or assistance in managing ongoing health concerns, or encouraging preventive care, benefits are a major factor in the overall health of plan members. 

I would define the underlying goal here as working to promote positive health outcomes for plan members. 

Mental wellness: Just about every survey I’ve seen in the last few years reports increasing concern among employees for issues of mental wellness – such as stress, anxiety, feelings of isolation and difficulties juggling the challenges of both work and home life.  

So, the goal of our benefits plans has to be, first, to acknowledge mental wellness issues and, second, to reassure people in the workplace that they can access services to help them cope. 

Engaged employees: If we want our people to engage with the mission of the organization, and to care about their own contribution to it, they will expect the employer to care about them just as much.  

I see employee engagement – liking their jobs, buying into the mission, supporting fellow employees – as the overall goal of any benefits plan. 

Well workplace: I would describe the goal of building the “well workplace” as consisting essentially of creating a sense of community and fostering a caring environment, the results of which flow throughout the organization. 

This is where all of our efforts come full circle.  

Success: Ultimately, one of the goals of employee benefits – deeply intertwined with all the other goals – is success. We want our people to be successful, and always to see greater success within their reach. Benefits such as matching retirement plans help employees not only save for the future but also build a sense of financial security. 

The goals of a benefits plan, of course, do not exist in isolation. They work together, not only with other benefits, but with everything else that is happening in the workplace. In other words, it’s important to look at every element of the plan in terms of how it supports and contributes to every other element. 

Financial planning assistance, for example, can be seen as a useful perk by itself, but it can also be seen as a significant contributor to mental wellness. As we have discussed in previous blogs, financial worries are often identified as a leading cause of stress among employees – so it follows that financial planning assistance, and giving plan members the feeling that they are on the right track will significantly reduce stress and improve overall mental wellness. 

Similarly, mental wellness initiatives, such as access to a robust employee assistance program including confidential online counseling, can provide help to employees struggling with a personal or other issue. At the same time, however, that assistance will help to foster the “connectedness” we want to build as part of the well workplace. 

Benefits should also be flexible and responsive to workplace demographics – employees from different generations tend to have different priorities. 

So, what I’m seeing is plan sponsors asking a great deal more of their benefits plans than merely offering an array of benefits and leaving it at that. They are looking at each specific element of their plans in terms of achieving identified outcomes, and they are looking at the overall plans in terms of how well it all fits together to create an effective whole. 

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I really appreciate comments, ideas, suggestions or just observations about the blog or any other topics in benefits management. I always look forward to hearing from readers. If there’s anything you want to share, please email me at bill@penmorebenefits.com. 

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