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Treading the line between benefits choice, personalization and impact

Find the right balance between benefits choice, personalization, and impact. Our reports highlight the pitfalls of offering too much choice without a clear strategy. Tailor benefits to diverse workforce needs for higher retention. Streamline options and maximize returns on benefits spend.
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08/03/2024 · 5 minute read

Over the past few years, employers have introduced a wide range of benefits to meet the needs of an increasingly diverse workforce.

With the workforce remove now made up of five generations, each with its own unique needs, a one-size-fits-all approach to benefits is contradictory at best. Our Health on Demand 2023 report found that 72% of employees receiving 10 or more benefits say they are less likely to move to a competitor, showing a clear link between employee choice and retention.

Faced with COVID-19, inflation, geopolitical instability and acute skills shortages, many organizations have introduced a so-called ‘currently proliferation of perks’. For instance, well-intentioned employers responded to the pandemic and subsequent talent crisis by introducing benefits such as discount schemes, well-being apps and voluntary benefits. However, despite all the new supports in place, only 59% of employees currently say that their benefits meet their needs.

That’s because too many options can cause confusion and actively disengage employees. Going a step further, these additional underused benefits are a drain on corporate resources and require additional administration effort. Ultimately, it can make it hard for employees to understand exactly what’s on offer and much harder for HR teams to measure tangible returns on benefits spend.

Organizations must find a middle ground where benefits are impactful, strategic and well understood — and genuinely meet the needs of employees. This means being intentional in their strategy, starting with a globally consistent employee experience.

Employers should start with minimal standards for benefits design, ensuring that all employees have access to foundational offerings like cancer prevention, maternity care and mental well-being as standard.

Then, focus on benefits that support their individual employees when and how they need it. One approach is via spending accounts. These give employees access to a sum of money, allowing them to receive reimbursement for activities that support their own approach to well-being or personal development, within set parameters. This offers a win-win solution, with ultimate flexibility for employees and simpler program management for employers.

We also expect curated marketplaces to evolve in the future. Instead of selecting individual providers, organizations can use aggregators to select and bundle possible packages. Given the increasing complexity in the digital health and well-being marketplace, this is an attractive option for employer- and employee-paid benefits.

Questions to ask:

  • Are you offering a technology-enabled range of benefits that genuinely meet people’s evolving needs?
  • Can you do more with less by investing in digital platforms to support benefits administration and communication?
  • How are you using technology to create flexibility in your offering that is meaningful and relevant for employees?
  • How can you create global consistency in how employees understand, access and use their benefits?
  • How can you meet diverse employee needs while streamlining benefits oversight, administration and vendor management?
  • With benefits spend totaling a significant percentage of payroll, how do you realize a real return on this investment?

Next steps

Technology helps employers keep benefits relevant for their people. Our research found that 78% of employees with access to benefits technology say their benefits meet their needs (compared to 47% of employees without benefits technology), and 80% state they are thriving in their role (versus 54%). Investment in technology allows employers to better plan for the long-term, respond to challenges and streamline their processes. Technology solutions enable sensible flexibility, ensure global consistency in line with your company’s purpose and values, and help you to actively manage your plan and reach your short- and long-term objectives. Technology is the foundation for any effective benefit strategy. Use the findings from our Benefits Technology 2023 research for steps to take to thrive in an ever-changing world.

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