The Data Behind Benefits: Making Informed Decisions During Challenging Times
When it comes to benefits provision, data analytics is more vital than ever before. Against the backdrop of our new working landscape, employers urgently need visibility of the fluctuations in benefits uptake, cost and areas of risk.
Tackling difficult decision making
In the short term, the response to our current situation has largely been reactive and focused on immediate solutions. Whether that’s enabling lower pension contributions from employees or extending benefits so that dependents can be added to PMI schemes, the focus has been on what can be done to support people now.
But activity like this will of course have cost implications. And given the financial strain that many companies are experiencing, it may be incumbent on employers to look at how they save on costs. Streamlining their benefits offering and reducing overall scheme spend may provide the quick win many need.
However, taking such decisive action without insight will be difficult. This is where data analytics comes in, providing the information HR teams need to make the right decisions for their businesses and people. It can help identify areas where expenditure will be unsustainable, areas of significant benefits investment despite low employee take up, and the demographics most affected by the crisis.
Striking the right balance
While cuts are to be expected in this climate, there’s also a fine line to strike between making savings and disengaging employees.
Some organisations will be furloughing people or seeking to make longer-term reductions in headcount. When doing so, they’ll need to consider whether the benefits they offer are still relevant for their workforce. Having the tools in place to capture real-time data on benefits usage and monitor changes to this will allow HR teams to understand if they’re getting their offering right, and if not, will help them pivot their approach quickly.
Looking ahead businesses must also be mindful that their people are vital to their operations moving forward – not just in the near-term but the longer-term too. Keeping employees engaged with the business throughout this period will be essential, and benefits play a key role in this.
After all, while recruitment is currently on hold across most industries, when we emerge from this, there will be change – and businesses will have to fight for their best people. This means putting support and benefits in place that create the best employee experience possible within the parameters of the ongoing disruption to encourage company loyalty.
The ‘new normal’
There seems to be consensus that this pandemic will bring about a ‘new normal’ to working. In 2019, only 5% of people predominantly worked from home. This could change significantly. At the very least, people who previously worked from home once a week are likely to do so more frequently, and companies that didn’t offer this flexibility before may need to change their stance.
This will bring with it new benefits complexities, as employers have to cater for a large segment of the workforce with different requirements. For example, cycle to work schemes and season ticket loans will be irrelevant for those choosing to work remotely. Employers will need a steady stream of data on how employees are using their benefits to make sure their offering stays relevant.
It’s fair to say that the immediate adoption of analytics is unlikely to be a high priority for HR teams who don’t already have it on their radar; they’ll have more pressing concerns. However, those who have the capability to analyse their benefits data are in a stronger position to quickly identify problematic shifts in benefits usage and the resulting cost implications. This allows them to get ahead of the issue and rectify it quickly. Those that ‘have’ will emerge from this crisis stronger than those who ‘have not’. Analytics will be a key issue moving forward for HR teams to help them stay resilient in the face of future black swan events. When HR teams are able to make this shift, they will lay the groundwork for a more insightful, agile, and reactive benefits proposition.