The age of agility: Flexible, adaptable and resilient benefits’, a report released today by Thomsons Online Benefits, has found that HR teams are spending more on benefits than ever, but struggling to demonstrate the effectiveness of this investment to their boards.
The research, which surveyed 542 HR leaders responsible for 5,000 to 50,000+ employees globally, found that 42% are spending 20% of employees’ baseline salaries on benefits. This is equivalent to over £6,000 per person, based on the average UK salary. In 2019, just 26% of organisations were investing this sum. But despite this, only half are using analytics to monitor benefits take up levels, meaning this spend could be going under appreciated and under used.
HR leaders cite ‘too many data sources’ as the biggest blocker to analysing employee data, and this is creating significant leg work for HR teams, with over 55% of respondents spending 11 hours or more every month manually transferring data to and from providers and HR systems.
Chris Bruce, Co-founder and MD, Thomsons Online Benefits, comments: “HR teams are having to re-think how they support a workforce that’s no longer based in one location, often whilst balancing wider financial constraints. Within this context, it’s incredibly concerning that many don’t have the capability to capture and interrogate their data in a meaningful way, leaving them exposed when it comes to making decisions that could better support people where they need it most. If HR teams don’t understand how employees are engaging with their benefits, how are they meant to know what they want from their reward packages – and how these needs change over time?”
Josh Bersin, Global Industry Analyst adds: “The pandemic has brought HRs and the HR tech market together. The next year is an opportunity for HR leaders to accelerate their work to create an integrated, healthy, and productive employee experience.”
The report suggests that whilst investment is on the rise, HR teams are struggling to make the most of increased technology budgets, purchasing disjointed systems that make it difficult to compare data insights or identify a single source of truth. Indeed, those who spend more than 60% of their HR budget on technology spend over 15 hours every month manually transferring data.
Perhaps even more concerning, 53% of HR leaders believe that their current procedures and processes with HR technology expose them to undue risk – meaning that manual data transfer isn’t just arduous, but is leaving teams exposed to errors and security breaches too.
Chris Bruce, continues: “We’re seeing a serious disconnect between investment and measurable returns, which is undermining HR teams’ authority and providing a blocker to further investment. ‘Lack of board-level buy-in’ is cited as the biggest barrier to further technology investment by HR departments, and it’s not hard to see why – they’re yet to see that the right technology pay dividends! If HR leads want to change this, they need to think smart. If they have systems that talk to one another, they’ll be able to demonstrate the value of their investment and make an even bigger, positive impact.”