In the broadest sense, employee benefits are nothing new. Using a metaphorical carrot to support, motivate and reward the workforce is a tool those in positions of power have wielded for centuries.

Even in Roman times a form of defined benefit pension was instituted by emperor Augustus to provide for veterans of the Imperial army.

In the modern era, however, the concept of employee benefits has undergone dramatic transformation. Recent decades have witnessed a shift from the offer of complementary, discretionary perks to the provision of a complex array of employee-centric services that are far more deeply embedded into a company’s employer proposition, and are of increasing importance in the battle for talent.

Awareness and uptake

As well as pensions, employees today can expect to be offered tax-efficient schemes, such as salary sacrifice, healthcare services to support both physical and mental wellbeing, and a plethora of other offerings from retail discounts to gym memberships and even ‘paw-ternity’ leave to care for a new pet.

Establishing a strong benefits offering can be both challenging and costly in itself, but awareness and uptake among employees should not necessarily be taken for granted. Around half of HR leaders reported a lack of interest among their staff, one survey found.

As such, companies must also effectively promote engagement with those benefits if they are to maximise utilisation – which is key for optimising an employer’s return on investment and communicating their commitment to worker wellbeing.

Fragmented benefits landscape

As the scale and complexity of benefits offerings have grown, the challenge of engagement with benefits has only become harder. With different benefits delivered across different platforms, the target audience can be presented with a fragmented landscape featuring a range of different services available from different providers. Even when awareness levels are high, this can be potentially confusing and overwhelming for staff, leading to ‘analysis paralysis’ and lower-than-expected uptake.

Employers, faced with higher costs from supporting a wide-ranging benefits portfolio, are increasingly aware of this issue. In response, the majority of companies (60%) are planning to adopt solutions that help employees navigate and access the benefits on offer, according to one survey.

These digital tools provide a platform for integrating broad-based services into a centralised point of access. Being equipped with such a holistic view helps guide the workforce through the process of learning about and accessing the variety of benefits on offer.

As well as aiming to increase uptake, they also provide companies with valuable data on interest and usage levels, which in turn can be used to shape, refine and optimise services on offer, contributing to improved ROI.

Getting personal with AI

Personalisation is a key aspect of this type of navigation solution, and it is typically supported through the use of artificial intelligence (AI). This technology can simplify the complex task of matching staff to the benefits that are likely to hold the highest appeal, while also feeding into communication strategies through the use of reminders and messaging.

But technology is not the only tool available to employers who are seeking to maximise uptake of benefits among their teams. Behavioural science techniques, for example, are also being employed by some companies to persuade, influence and motivate their staff.

In simple terms, behavioural science refers to the study of the forces that underpin our actions and decisions. Based on this knowledge, it is possible to develop strategies for presenting information in a way that encourages desirable choices and behaviours, ‘nudging’ people towards certain goals, actions or outcomes.

Bypassing mental blocks

Behavioural strategies are underpinned by an understanding of the emotions, inherent biases and thought patterns that can act as unconscious barriers in the minds of employees. People can be prone, for example, to preferring the status quo over making choices that involve change – even if they stand to gain from such a choice.

It is also typical for people to feel more strongly about a perceived loss. This bias, known as loss aversion, has the potential to negatively influence perception of benefits such as salary sacrifice, which might ultimately enhance an employee’s financial prospects in the long term but are not embraced because there is an impression that a ‘sacrifice’ must be made in the short term.

Armed with an understanding of these behavioural traits, employers can adapt their approach accordingly. It allows benefits to be framed in the most appealing way for different segments of the organisation, or even for communications to be personalised to an individual’s situation or needs.

Managing complexity

The use of approaches such as behavioural science, AI and benefits navigation platforms might sound complex, but in a world where benefits offerings have become increasingly sophisticated, they provide the means to improve communication, maximise engagement and optimise uptake among employees.

For companies, they can help generate a better return on their investment in staff, enhancing satisfaction among a greater proportion of the workforce while building loyalty and employer appeal. Because, put simply, benefits are only likely to deliver for a business if employees see their value, engage in the offering, and feel those benefits first-hand.

The information contained within this communication does not constitute financial advice and is provided for general information purposes only. No warranty, whether express or implied is given in relation to such information. Vintage Corporate or any of its associated representatives shall not be liable for any technical, editorial, typographical or other errors or omissions within the content of this communication.