Companies are facing multiple challenges, from new ways of working and an increasingly diverse workforce to new business models, digital transformation and evolving consumer demand. In this increasingly complex landscape, they must inspire and invigorate their people by redesigning the work experience while also protecting against heightened risks in areas such as misconduct and poor succession planning.
The pandemic has forced employers to revisit their talent management strategies, particularly as remote working has transformed how we think about office spaces and business travel. At the same time, monitoring and maintaining company culture has never been more difficult, and managers have needed to adapt to “virtual” employment.
Pre-pandemic, just 4% of HR teams believed they delivered an exemplary employee experience.1 Companies have since had to develop innovative talent management practices, policies and procedures to reinvent the employee value proposition. These innovations are needed to solidify depth of talent, build trust and find new ways to monitor behavior to ensure it aligns with company objectives and values.
This is not just about building a strong talent pipeline, an employee value proposition and motivating the workforce. There are other people risks inherent in talent management practices.
For instance, companies must identify, assess and control talent risks related to misconduct — such as fraud or unethical conduct — too much key person dependency; or risks associated with a mobile population.
Although talent practices, for the most part, have previously been considered largely an HR responsibility, organizations are waking up to how vital workforce well-being and morale are to the business’s health. And they’re beginning to understand that a multidisciplinary approach brings diversity of perspective and greater integration with the business. Consequently, decisions about benefits are gaining more C-suite attention. For instance, 74% of executives are anxious about lower-than-desired employee engagement, and 70% are concerned about the impact of high employee absences on productivity.2
With this in mind, HR teams must consider their strategies through the lens of risk management and wider board objectives. At Mercer Marsh Benefits (MMB), we have identified five key people risks when it comes to talent practices:
The benefits for organizations that successfully modernize HR strategies to address talent risk can be substantial. Our research demonstrates a strong correlation between the number of benefits provided and employee loyalty and energy levels.3
We found that energized employees are six times more likely to say their workplace is focused on health and wellness. And when asked what type of company they prefer to work for, one in two employees cite an organization that protects their health and financial well-being.4
Talent practices are also critical from a brand standpoint — both as an employer and for building a broader business image and reputation: Benefits can be an expression of your brand. One place to start is by ensuring benefits align with the external image you wish to convey.
For example, in China, we helped a healthcare industry client revamp its health screening program to be more in line with clinical best practices. From a brand consideration, it was crucial that the organization not include features in its annual health checks that weren’t clinically sound — such as excessive X-rays.
Another common strategy is redesigning programs to add choice, thereby making benefits more attractive. Programs can be redesigned to both contain costs and appeal to a broader set of employee needs. Such a shift can go a long way toward building an employee value proposition that addresses talent risks.
HR directors that are looking to revamp policies and strategies to help manage and mitigate these risks should start by addressing five core questions:
The whole-person agenda — understanding people and their realities inside and outside work
Increased duty of care — for employee well-being, including exhaustion, grief and change fatigue
• Rethinking the HR model — including new benefits that work in a digital-first or blended work environment
The war for talent impacts employers regardless of location. Attracting, retaining and engaging talent is crucial for companies that want to be agile and innovative or need new skill sets to drive business change and results. To remain competitive, HR teams need to reevaluate business plans to ensure they meet the risks and needs of a modern workforce.
More important, benefits are pointless if they don’t actually benefit the workforce. That’s why solutions that add choice are so important. Whether designing flexible benefits plans, voluntary benefits, engaging benefits platforms or inclusive benefits that better address the needs of women, the LGBTQ+ community, essential workers or other disadvantaged populations — it’s all about delivering value.