Flare HR has partnered with CEB, a global best practice insight and technology company, to research the benefits that are offered across nearly 100 multinational businesses. The research provides the latest benefits benchmarking as well as some tips and tools about how to significantly increase the return on investment of employee benefits.
The role of benefits in talent management and employees engagement
In today’s talent-insatiable, cost-constrained employment market organisations must ensure they are maximising every dollar available to attract, retain, motivate and align their employees. However, many organisations are failing to realise even the most modest returns on investment from their biggest employment cost beyond fixed and variable salaries, i.e. employee benefits. Furthermore, they are failing to realise how important benefits are to employee loyalty. Benefits are becoming an increasingly important factor in determining whether an employee will stay with their employer, so providing and promoting a vigorous benefits package represents a win-win for employers and employees alike.
45% of multinationals view employee benefits merely as a hygiene factor rather than a talent magnet, which opposes the idea that employee retention is linked to benefits satisfaction. It is further disturbing that 75% of respondents do not intend to increase their expenditure on improving their benefits offerings. Contrary to previous belief, global policy is not the biggest hurdle to overcome in order to improve benefits packages; it is cost.
Here are 4 simple steps to increase you ROI at a very low cost:
STEP 1: Critique
- Conduct HR and Employee reviews and benchmark existing benefits
- Run a focus group with your HR team, Executive Committee or Remuneration Committee reflecting on the motivation, incentive, attraction and understanding your benefits bring
- Conduct a short survey in order to get a better idea of your employees’ understanding and satisfaction and what impacts their satisfaction
- Ask your employees what additional benefits they would suggest
STEP 2: Customise
- Focus your existing resources on the most valuable benefits according to your employees
- Retender your superannuation fees with your superannuation’s provider. Savings can be banked or reinvested
- Educate your employees about their investment options and superannuation related benefits
- Giving employees the option to purchase additional leave is both tax effective and reduces the salary bill for the business
STEP 3: Communicate
- Once your business has identified employees understanding and appreciation for existing benefits, develop a simple communications plan
- Educate your employees on how to make the most of existing benefits
- Develop a simple communications plan
STEP 4: Count
- Measure the impact of the first three steps and repeat at 6 month intervals
- Measure how, if at all, employee perceptions evolve
- Measure active usage; the percentage of employees that review or modify their benefits each year
- Measure the penetration; the percentage of benefits that are reviewed or modified each year
The autonomy to be able to control benefits that are offered by your business in combination with these simple low-cost steps can ensure a significantly increased return on the investment in employee benefits.