In part one of “Benefits Managers are Set Up for Failure,” author Eric Krieg exposed the difficult job benefits managers have of balancing their day-to-day responsibilities while trying to make meaningful and impactful change to the company’s benefits program.
Here’s an example of how benefits managers often operate:
A benefits manager is responsible for $10 million worth of benefits spend and creates a strategy to save $1 million. If they then move ahead with the strategy to save the company money, how are they rewarded? Simply put, most benefits managers receive no reward.
Predictably, benefits managers don’t make the change. They revert back to what they are comfortable with and incented to do which is to keep employee complaints to a minimum and make sure the executives don’t hear any noise. This translates to their focus and efforts expended on managing to the outliers (the vocal minority).
Managing to the outliers. What does this mean?
Benefits managers know that if they make a strategic change which will save the company $1 million, let’s say five percent of the employees might not like the change. Even though, in this scenario, 95 percent of employees might like the change or simply be neutral, the vocal minority will rule the day. We all know a few complaining people can make a lot of noise.
Let’s look at this from a different angle. If you had a solution that had a 95 percent favorability rating and saved a considerable amount of money for your company, wouldn’t you do it?
Unfortunately, oftentimes instead of forging ahead and making the change to save the company $1 million, benefits managers manage to the outliers and avoid being beaten up by the five percent. They ask themselves: “Why should I do the additional work and take the risk which comes with the change to receive no additional compensation or recognition?”
This is not an uncommon problem in the corporate world, but the solution is simple.
The Straight Talk: If your benefits managers are properly incented, compensated and recognized, companies throughout the country will save millions of dollars, increasing their bottom lines.