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At the Center of the Benefits Universe

A Purpose-Driven Approach

In the dynamic and personalized world of mobile orders, plug-in cars, FaceTime, and Venmo, it’s not surprising that today’s workers want something more dynamic and personalized in return for their work. For some, it’s an increase in fair pay that reflects one’s value and contribution to the organization. For others, it’s the stability of health-care benefits and financial security — knowing that despite the ever-changing and uncertain world, their employer-sponsored benefit plans offer a sense of protection. For many, it’s increased flexibility to co-manage their work and personal lives. And for most, it’s the ability to choose where they invest their pre- and post tax dollars, what purpose these investments will serve, and how to assess the value they will receive in return. 

Collectively, today’s workforce is seeking a unique and differentiated experience that is reflected in people’s day-to-day work and demonstrated through the company’s talent value proposition (TVP). An experience that feels tailored, sustainable, technologically enabled, and purpose-driven — much like the way a mobile-ordered coffee or custom-featured electric car is personalized to meet an individual’s preferences and priorities. As the workforce’s expectations grow regarding the experience they seek, the questions for companies become:

  • How do we deliver programs and develop a culture in a cost-effective and sustainable manner that drives engagement, productivity and commitment to the organization?
  • How do we connect business outcomes and social value to meet the needs and wants of the organization’s most valuable assets: its people?

With demographic shifts and skill shortages affecting organizations, today’s leaders are working to evolve their existing total rewards portfolio to not only serve as a competitive differentiator in attracting and retaining talent, but also to engage existing talent and meet people where they are and where they want to be on their life journeys. This is fundamental in today’s talent experience.

As organizations shift their mindset away from traditional programs and toward more evolved benefits that place greater focus on employee purpose, they have an opportunity to home in on what matters most to their employees in an intentional and meaningful way. Meeting employees where they are requires organizations to contemplate the employee’s needs and wants, and then determine how to optimize the investments — of both the company and the employee — in each respective program. Meeting employees where they want to be requires organizations to create a benefits experience that is rich in personalization and choice and also creates more meaningful impact. This is purpose-driven benefits.

Purpose-Driven Benefits: The Center of the Talent Experience

Purpose-driven benefits are policies and programs that meet participants both where they are in terms of understanding their priorities and preferences, and where they want to be through personalization, choice and impact.

Purpose-driven benefits put the employee at the center of the talent experience, and help optimize everyday living. Purpose-driven benefits are most effective when offered in the context of purpose-driven total rewards, which are pay, benefits, career and well-being initiatives that: •• Align with and advance an organization’s purpose, values and culture •• Reflect attributes of a healthy company culture, including inclusion, diversity & equity (I, D & E) efforts 

  • Amplify the talent value proposition and differentiated talent experience
  • Are user-centric, and meet talent where they are through personalization and choice
  • Drive engagement, productivity, and financial performance
  • Unleash workforce capability and enable inspirational leaders to flourish.

The notion of purpose-driven benefits includes the following examples:

  • A spectrum of health-care plan offerings that provides the right coverage for most employees depending on where they are in their career and life stages; includes decision support to help employees choose a personalized plan; and provides tools and resources for finding high-quality health care and managing acute and chronic health conditions
  • A family maternity benefit that manages a pregnancy and also supports the individual and/or family when deciding whether to pursue pregnancy; provides medical and pharmacy fertility benefits if needed; covers preventive care and delivery of the baby and the mother; and supports the family with post-partum resources and applicable leave programs. This applies to same-gender parents as well.
  • Socially responsible initiatives such as corporate social responsibility, community service, time off and employee resource groups, as well as creation of an environment and culture that connects the individual to the community (employee population and beyond), as well as his or her individual purpose.

The correlation between purpose in life and the use of preventative health-care services suggests that having a purpose in life has been proven to reduce health-care costs, according to a 2014 National Academy of Sciences study. For example, adults with a stronger purpose in life were more likely to engage in preventative measures (e.g., obtaining a cholesterol test, colonoscopy, mammogram, Pap smear, or prostate examination) than those with a lower sense of purpose in life — thereby reducing the number of hospital night stays. Purpose-driven benefits help reinforce this virtuous cycle and can have a direct impact on healthcare costs for an organization and the individual. 

No Longer Your Parents’ Benefits

94% of today’s employers are very confident that their organization will continue to sponsor health-care benefits five years from now, according to WTW’s 2018 “Best Practices in Health Care Employer Survey.” This suggests that organizations believe they are well-served by providing their employees with access to high-quality health care and, increasingly, the information necessary to help make informed decisions related to their health-care needs through decision support tools resulting in a sustainable health-care program.

Many programs of the past served a basic “purpose” in providing consistent health-care coverage and protecting employees and their dependents from a catastrophic financial event. Benefits (and their purpose) have come a long way since then — with some companies, for example, morphing from a single indemnity plan to multiple plans supported by a personalized shopping experience where today’s participants can choose the benefits that best meet the needs of their particular life situation and provide them with a sense of assurance and support.

At a time when advancements in technology rapidly increased the capabilities of employees’ smartphones, parallel breakthroughs were advancing capabilities in medical discovery, delivery and care. Seemingly, with each new smartphone upgrade that hit the market, advancements in fertility treatments, biosimilars, genetic testing, and immunology came onto the scene. These medical breakthroughs changed the perception that health care was simply about preventative, diagnostic and managed care, and created a sense that health care was more about taking us forward in ways that were purpose-driven, life-enhancing, and dream-pursuing — fundamentally enabling today’s employee to achieve his or her portfolio of personal and professional goals. 

Some companies have morphed to multiple benefits plans supported by a personalized shopping experience.

Today’s evolved benefits strategy articulates an approach and a portfolio that is aligned with business goals, accommodates a changing workforce and delivers a high-performing and sustainable benefits program. Such strategies contribute meaningfully to employee security, well-being, engagement and productivity — and reflect the opportunity for a high degree of personalization and choice. While benefits are valued by employees in all career stages, not all employees value every benefit in the same way. In today’s world, preferences differ across demographic groups, as well as within them (i.e., not all employees of the same generation value benefits in the same way). To evolve, benefits and total rewards leaders must explore moving their programs beyond the status quo — aligning with the value proposition and workforce strategy — to what matters to employees and, again, meet employees both where they are and where they want to be.

Bringing Our Authentic Selves to Work

Just as the sophistication and personalization of benefits evolved in parallel with the sophistication and personalization of technology, purpose-driven benefits have evolved with the focus of companies on organizational and individual purpose.

Since their outset, benefits have served the basic purpose of providing security. A broader purpose became prominent in corporate boardrooms in January 2018 when Larry Fink, CEO of BlackRock, articulated the importance of organizational purpose and alignment with human capital strategies in his annual letter to CEOs:

  • “Without a sense of purpose, no company can achieve its full potential . . . companies must ask themselves, ‘are we working to create a diverse workforce, are we adapting to technological change, are we providing the opportunities that our employees and our business will need to adjust in an increasingly automated world…are we using behavioral finance and other tools to prepare workers for retirement...?’
  • A sense of purpose is an understanding at every level of the company about its role in the world and in the community. Purpose unifies employees, helps companies see their customers’ needs more clearly, and drives better long-term decision-making. This is true whether you’re producing oil, making movies, or helping people plan for retirement.”

Larry Fink’s message pushed purpose onto the corporate agenda, and organizations quickly began to embrace the notion — and need for — both the well-being of their employees as well as healthy company cultures with a safe working environment, where individuals can bring their authentic selves to work without fear. This purpose is one purpose supported by HR, compliance, legal and ethics policies that protects against harassment, bullying, and other abuses of power. It is a purpose that encourages inclusion, diversity and equity at all levels of the organization and a purpose that is fully supported by the culture of total well-being.

Research suggests that purpose and inclusion lead to a more engaged, productive and healthy workforce. According to the Conference Board’s 2018 Global Leadership Forecast, purpose-driven companies outperform the market by 42%. Research from the Center for Talent Innovation reports that organizations that have high ratings for inclusion and diversity are 70% more likely to have success in new markets and 45% more likely to improve their market share. 

Purpose-driven incentives forge a new path as the predominant change agent in influencing well-being choices.

This culture of purpose and total well-being drives the need for purpose-driven total rewards programs, including benefits designed specifically to support these concepts. As such, today, the concept of purpose-driven benefits demonstrates how employees are embracing employer offerings more broadly to enhance their lives and support their individual purposes, suggesting: My benefits allow me to bring my full self to work; have a family; improve my well-being; and create greater understanding and connection between me and my employer.

This sense of purpose extends well beyond core health benefits and includes voluntary and lifestyle benefits such as tuition and loan reimbursement, pet insurance, identity-theft protection, auto and home insurance, dependent care savings, and financial planning assistance. This purpose-driven approach to benefits aligns policies, programs and environments that build cultures of well-being in an ecosystem where purpose matters.

Making Purpose-Driven Benefits Meaningful and Relevant

Employers expect health-care costs to increase 5% in 2019, up from 4.7% in 2018 (after plan changes), according to the previously cited WTW survey. As employers look ahead at the rising costs today and toward increased costs in the future, they have adopted a laser focus on enhancing the overall health of the workforce to decrease employer health-care expenses and minimize employee out-of-pocket expense.

To accomplish this, employers are prioritizing ways to better manage clinical conditions, steering employees to high-quality doctors and health systems, investing in employee well-being, and evaluating innovative technology partners that enhance the employee experience. These actions, however, may not be adequate or swift enough. American workers face the reality of spending their salary increases solely on health care, according to the recent WTW article, “Health Care USA: A Cancer on the American Dream.” Employers are asking themselves, “Why not make employee benefits as meaningful and relevant to them as possible?”

While today’s benefits have changed significantly since the full indemnity plan of the 1970s and 1980s, the need to maintain a healthy workforce on a daily operational basis is still central to many growth strategies — particularly those in industries such as airlines, grocery stores and retail organizations. In addition to health care itself, employers faced with absenteeism risks are providing incentives to influence and drive key behaviors to ensure employees are healthy enough to come to work, and when they do come, that their minds are present and engaged. However, these incentives often fall short in changing behaviors and driving the impact that was intended. In this new environment, purpose-driven incentives forge a new path as the predominant change agent in influencing well-being choices, simply by bringing impact into the “give and get” equation.

To increase employee well-being and engagement, evolved organizations are putting the employee at the center of the equation. Consider the following: Data shows that one in eight women today will be diagnosed with breast cancer at some point in their lives. If employers want women in their 40s to take care of themselves, they use behavioral economics to drive engagement with purpose for the employee and the employer. They ask how they can do this, thinking about what matters to women in their 40s, and being aware that many women in this demographic also maintain responsibility to take care of dependents before addressing their own needs. Consider the following example: 

  • A large retail employer achieves significantly improved preventive-care results by offering that all eligible women who received a mammography during a specific time would trigger the donation of a mammography to uninsured/underinsured women in their community. Some companies extend this concept to additional employee cohorts, offering that for every five employees who are not either gender or age-eligible to receive a mammography, instead could receive a flu shot in exchange for the donation of a mammography. As a result, the employer has seen an increase in the engagement of critical preventive-care actions: The employee is connecting to an action associated with both individual purpose and company purpose, and, together, they are having impact on a broader social cause, creating a win-win-win proposition in the process.

As organizations contemplate ways to enhance their current policies and programs — staying focused on the needs and wants of their talent — they have a unique opportunity to not only demonstrate the purpose these benefits are intended to serve, but also highlight the impact that many of these existing benefits have on their employees. Examples include managing overall health conditions, and improving employee well-being and meaning, such as:

  • Building and supporting families through fertility and maternity care, adoption benefits, and parental leave
  • Enhancing (and extending) lives through access to advancements in cancer care and other clinical care areas
  • Managing emotional health through resiliency and purpose training
  • Pursuing dreams through student-loan reimbursement, financial assistance and retirement planning.

Connecting the Employee Experience to Better Business Outcomes

According to Willis Towers Watson’s Best Practices Survey, best performing companies (those that save more than $2,200 per employee per year compared to the national average) do more to encourage health and well-being by:

  • Aligning the work environment and well-being programs with healthy company culture
  • Sponsoring worksite well-being campaigns and offering nutrition education or seminars
  • Sponsoring programs or pilots that target specific conditions or high-cost cases.

In addition to a focus on cost savings, employers are aligning their well-being programs with their employee value proposition (TVP). As such, and according to Willis Towers Watson, it is not surprising that 72% of employers in the previously cited WTW survey are making employee experience in benefits a top priority right now and over the next three years.  

Further research shows that a growing majority of employers consider engagement and consumer experience to be a priority over the next three years. This includes increasing employee engagement in health and well-being.

Organizations paying attention to health care also are being intentional about purpose and are working hard to keep employee needs and wants at the center of their programs. Human-centric design is an approach that enables organizations to discover what really matters to the employee, and then develop and deliver a solution that can solve it. By addressing workforce needs in this manner, human-centric health demonstrates that what matters to the employee also matters to the employer. This is a new approach for companies, and one that is right for organizations looking to create a more personalized experience for a diverse employee population — a population concerned with costs but also looking for an experience that puts their needs at the center (or perhaps the forefront) of the employment deal.

Willis Towers Watson research shows that companies demonstrating best practices relative to the talent experience are three times as likely to report employees are highly engaged and 93% more likely to report significantly outperforming their industry peers financially.

At the Center of the Talent Value Proposition: Purpose and Well-being

Purpose-driven benefits help bring the components of purpose and well-being together, particularly in the context of total well-being — or well-being that looks at the “whole” person — and the environment they work in. Well-being today encompasses physical, financial, emotional and social well-being, and is purpose-driven unto itself, focusing on healthier, happy, more secure, and meaningful living for the employee and their dependents — and putting their well-being needs out front (e.g., What do I need to feel good? What is my purpose?). In addition, a 2014 Psychological Science report suggests that living with a purpose means living longer. In a longitudinal study, researchers found that people living with a purpose have a 15% lower risk of death over the next 14 years.

The most successful well-being approach has two key characteristics: It keeps the employee experience at the center and it takes a truly integrated approach. Traditional wellness approaches have tended to focus primarily on physical well-being in an attempt to make employees healthier and reduce employer costs. While a worthy objective, and often results in an improvement in health status, this approach has failed to focus on individual’s wants and needs, using instead the allure of a portfolio of disparate programs and financial incentives to attract attention. As a result, short-term behavior change has not been sustained, driving employers to recognize the need for change.   

Employees don’t want a one-size-fits-all approach, nor do they think that attending a single resiliency program offered through a vendor as a solution for stress, is going to ease their pain. Employees want to be met with what they perceive as a “valued offering” that fits their life stage, wrapped in an experience that makes interaction easy and timely.

Crafting a new employment deal that demonstrates this combination is not simple or easy, but it is necessary for employers seeking to differentiate their organization from their peers. To be as effective as possible, employers need to make well-being a foundational part of their corporate culture so that it shapes their employees’ experience, which is at the center of their TVP. They also need to make the policy, systems and environmental changes that establish and maintain a healthy company culture, including focusing on the role and impact of senior leadership and day-to-day managers. This represents a significant leap from the current position of well-being, typically as a set of stand-alone programs.

Improving employee well-being and managing clinical conditions are the highest strategic priorities amongst employers today, with 82% believing it is important to enhance employees’ well-being over the next three years. Specific actions being considered include:

  • Sponsoring programs that support specific clinical conditions
  • Offering and promoting decision-support on borrowing, refinancing, and consolidation of debt
  • Ensuring a company-wide behavioral health strategy/action plan
  • Integrating well-being and I, D & E efforts as part of the organization’s corporate social responsibility strategy and mission.

According to the Global Wellness Institute’s 2016 “The Future of Wellness at Work” report, the world’s 3.2 billion workers are becoming less happy — about 40% of workers suffer from excessive stress at work and 25% are actively disengaged at work. And, the situation is not improving with the newer entrants in today’s workforce. Aligning total rewards and benefits with purpose can help here, too.  

In a recent WSJ article, Gen Z is reporting higher levels of anxiety and depression as teens and young adults than previous generations. About one in eight college freshmen felt depressed frequently in 2016, the highest level since UCLA began tracking it more than three decades ago.  Accordingly, as the article continues, [this] is one reason EY three years ago launched a program originally called “are u ok?” — now called “We Care” — a companywide mental health program that includes a hotline for struggling workers.

Well-being programs optimize how we feel about ourselves — and are considered purpose-driven in their objective to enhance one’s approach to everyday life. Given the stigma often associated with accessing EAPs or even admitting “I need help,” wellness programs and behavioral health efforts are not as readily used by those in need. And, in light of HIPPA regulations, access may not be measured to the fullest. This is an area in need of immediate change.

10 Ways to Infuse Purpose into Your Benefits Programs

Organizations today have a unique opportunity to use purpose-driven benefits to help their employees live full and meaningful lives, both through the experience they create within the work environment and how that experience cascades into their lives and families beyond the confines of work itself. So, where do employers get started?

  • Determine whether your organization understands the benefits wants and needs of its workforce; create opportunities for employees to share their voice and perceived value via crowdsourcing, conjoint analysis, and other feedback vehicles. This should reflect I, D & E efforts and assessments as well.
  • Understand your employees and the personas (personae) or groupings of your population in order to understand their barriers and your opportunities.
  • Assess your current total rewards and benefits strategies to determine whether they incorporate choice, personalization and an experience that meets employees where they are today and where they want to be tomorrow.
  • Assess your current benefits tsp. portfolio (including voluntary and lifestyle benefits tsp. as well as workplace perks) to determine whether the offerings reflect the needs and wants of your workforce.
  • Go beyond programs alone and align with the objectives of a healthy company culture that includes leadership commitment to purpose (and purpose-driven leadership), well-being, I, D & E and anti-bullying/harassment/abuse of power.
  • Ensure that employees’ needs and wants are at the center of all strategy and design decisions related to your well-being programs (physical, financial, emotional, and social well-being).
  • Use behavioral economics to identify ways to design purpose-driven incentive programs that evoke behavioral change and create a feeling of individual impact.
  • Consider the messages that your current total rewards and benefits strategies are sending; ensure that they are aligned with company strategy, the talent value proposition, and the desired talent experience.
  • Determine where there are opportunities to enhance existing policies and programs and how they are conveyed to demonstrate a stronger connection with purpose. Highlight employee stories and moments that matter (with permission, and where applicable).
  • Use multiple vehicles to demonstrate the employee at the center of your organization. This creates a sense of employee value and further validates that purpose driven benefits are designed to enhance the lives of employees and their dependents.

Instilling a greater sense of purpose into this experience by placing the employee at the center will ensure that employees not only feel heard and valued, but that their employers are paying attention and care about their well-being. In today’s world of creating a differentiated talent experience and talent value proposition, this not only matters, it is essential.

Purpose-driven benefits optimize everyday living. Be it the birth of a child, the purchase of a new home, the confidence to voice an opinion or walk into a room, or a day spent with co-workers volunteering for a common cause. Organizations that infuse purpose into their benefit programs are bringing tangible meaning and impact to today’s employee experience, demonstrating “what matters to the employee matters to us” — and not just where employees are today, but where they want to go tomorrow.

Amy DeVylder Levanat Amy DeVylder Levanat is senior consultant and director at Willis Towers Watson.

Cara McNulty Cara McNulty is the North American leader of well-being at Willis Towers Watson.

Catherine O’Neill Catherine O’Neill is senior director at Willis Towers Watson.

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