The future of work has and continues to be a hot topic among experts weighing in on what the impact of automation will have on jobs and companies as a whole. The good news is that the conversation has shifted to a more positive one, focused on people embracing agile work environments, new roles, and new job titles. Guardian’s 5th Annual Workplace Benefits Study reveals that approximately two-thirds of businesses and workers anticipate at least some change to the nature of jobs and/or skill requirements in the next five years.
As the U.S. workplace evolves and jobs are transformed by technology and automation, organizations are beginning to reevaluate and update their workforce strategies. This means that the role of Human Resources is now more important than ever. To prepare for the future, HR professionals must be innovative, have a strong understanding of how their business operates, and essentially be the change-agents their company needs to address the demands of their multigenerational workforce.
One area of focus where technology has made positive gains is with benefits technology. There is a broad trend toward the digitalization of various aspects of human capital management (HCM) designed to create efficiencies within an organization. Even more important, it is helping organizations create a better employee experience when it comes to benefiting administration and enrollment. This new technology allows HR professionals to replace traditional, administrative HR tasks and focus more on being a strategic partner to the business.
Employer Adoption of HR Technology
Our study reveals that a majority of employers have increased their benefits technology spending in the last five years, with 50 percent expecting further increases in the next three years. The prioritization of adopting HR technology is to help address their top benefit challenges, which include controlling costs, creating efficiencies, ensuring legal compliance, and improving workforce engagement. Take for example that three in five employers say managing benefits is increasingly complex. The mounting pressure to meet these top benefit challenges is prompting companies to adopt benefits technology solutions to help address them.
C-Suite executives are also recognizing that benefits technology is an integral component to their overall employee benefits strategy. For example, 49 percent of employers cited better integration of benefit plans as “highly important,” up from 14 percent in 2016. There is also a consensus among experts that the integration of HCM systems will help create an enterprise model that adds value to the organization. A win-win for both employers and employees.
Meeting the Needs of Employees
The ever-changing workplace is also prompting employers to rethink benefits administration and enrollment. As personnel move towards a workplace that is virtual and remote, employers recognize they need better technology to meet the needs of a mobile, tech-savvy workforce. Our findings showed that one in five employers expect their agile workforce to increase significantly by 2020. As a result, many companies are re-evaluating their benefits model with a focus on improving the end-to-end user experience for their employees.
Not surprisingly, we found that generational differences exist with how employees view their employee benefits. For example, 46 percent of millennials have a solid understanding of how their employee benefits work compared to 60 percent of baby boomers. Additionally, millennials want a digital, mobile, and personalized employee benefits experience that mirrors what they get with consumer-driven brands. This is not going unnoticed by employers who are competing for talent during a hot labor market. In fact, more than 70 percent of employers rated improving the effectiveness of self-service platforms and helping employees make better benefits decisions as highly important to their benefits strategies. Employers understand that benefits are core to their talent recruitment and retention strategy and looking to have a competitive edge.
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Advancement in Technology Benefits Everyone
The benefits technology landscape has evolved rapidly. Years ago, there were a handful of vendors dominating the HR technology market, but as of 2018, more than 150 vendors now compete in this space. One of the positive outcomes is the rise of the software-as-a-service (SaaS) model, which enables both large and small businesses to gain access to cloud-based applications for handling various aspects of HCM. This growth has fueled an increase in companies outsourcing benefits-related functions. For example, in 2018, 80 percent of employers used an external vendor to manage one benefits task.
The rise in benefits technology offers employers a wider range of options which can be confusing and overwhelming. Adding to the confusion is how to integrate existing HR systems (i.e. payroll, onboarding) which are likely to be siloed and functioning independently. Our study showed that one in four employers stated that developing a benefits technology strategy is a top challenge.
This underscores the need for all HR professionals to seek expert advice on how to navigate their benefits technology options. However, this does not appear to be happening as often as it should. Our study revealed two in five employers have not spoken to a broker about their benefits technology needs. There could be multiple reasons–a perception that the platforms are too expensive; the company isn’t large enough; not ready to embrace new technology or too labor-intensive to implement.
This could be farther from the truth. The options available to companies nowadays are abundant. By collaborating with a knowledgeable expert advisor, HR professionals can build a business case for why their companies should be adopting the latest HCM technology. After all, the “future of work” has arrived. With companies focused on innovation and technology, the implementation of benefits technology is a business imperative.