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The digitalisation of HR

 

June 2022

 

Digitalisation has been a top agenda item for businesses this year, but what are the main challenges and blockers that businesses are having to overcome to get sign off to do a benefit technology project? We’re joined by Joanne Foster, Group Head of Reward & Benefits at Redde Northgate who shares her views on how the use of digital has really enabled them to simplify their processes, create efficiencies, improve the colleague journey and develop a suite of benefits. Guy Clarkson, UK Digital Growth Leader, Mercer Marsh Benefits also shares his insights on what business need to think about before they embark on their HR digital journey, and the trends he is seeing that have been the trigger point for businesses to make that move to digital. Listen to our podcast to find out what’s next for companies who are already embedded on their HR digital journey.
 

  • The digitalisation of HR - Podcast transcript

    Podcast host:

    Tiree Houghton: Client Strategy Director, Mercer Marsh Benefits

     

    Guest speakers:

    Guy Clarkson:  UK Digital Growth Leader, Mercer Marsh Benefits

    Joanne Foster: Group Head of Reward & Benefits, Redde Northgate plc

     

    Tiree Houghton: Welcome to Mercer's energising the employee experience podcast with me your host Tiree Houghton. Each week I'll be joined by guests who will share their experiences and insights to help you create a people-first workplace to attract and retain the best talent. On today's episode, we're going to be discussing digitalisation of HR, focusing on benefits technology. And I'm delighted to be joined by my colleague, Guy Clarkson. And really excited also be joined by one of our lovely clients, Jo Foster, from Redde Northgate. Thank you both so much for joining me today. Guy, could you give us a quick introduction?

     

    Guy Clarkson: Yeah. Hi, Tiree and listeners. My name is Guy Clarkson, and I'm the Digital Growth Leader in the UK here at Mercer Marsh benefits. I've been in the employee benefits space about 15 years, but very much with digital at the heart of a lot of what those 15 years have been spent doing.

     

    Tiree Houghton: Great. Thank you, and Jo?

     

    Joanne Foster: Yeah, hi everyone. So my name is Jo, Jo Foster, I am the head of reward at Redde Northgate. I've worked for the group for around nine years now, but moved into the role of reward around a year ago. And I've got the challenge of bringing 5,500 people on to one reward platform and one set of benefits.

     

    Tiree Houghton: Nice and easy challenge! So to kick us off. So in recent surveys, we saw that digitalisation has been a top agenda item for businesses, which then inevitably will cascade into HR. And whilst it's on the agenda, it quite often still needs that trigger to kick-start big projects like that. So Jo, for you, what was that trigger point and what drove Northgate to launching benefits technology?

     

    Joanne Foster: If you think about in the context that we've merged only back in 2020, so we were six different businesses, and we've merged now into one. So for us the trigger really was that and then the requirement to have everything in one place. So it's really important for us that our colleagues can easily access and choose the benefits that they've got in a really efficient way. And if you think about the organisation that we've got at the moment, where we're all over, we're spread across the UK, it's 5,500 people over like 150 locations, all with varying Ts & Cs. So it's so hard to manage reward and benefits kind of in that context, and efficiently, never mind be competitive, which is where we want to get to be. My biggest job is just getting everything into one place to start with. So that was our trigger.

     

    Tiree Houghton: Was everything managed offline for you beforehand?

     

    Joanne Foster: Yeah, absolutely. So we’ve got about five different IT platforms, five intranets. So everything was done quite piecemeal and we were really relying on old school spreadsheets. So really, really inefficient, shocking customer journey for people. And as you can imagine such a really low take-up of sort of the few things that we did offer. So we were in that world and we were getting colleagues saying to us, well we want more benefits, I don't understand the ones I've got, and when are we going to get some new ones that everybody else has got in a different part of the group? But I just couldn't do anything, because it's so labour intensive as it was.

     

    Tiree Houghton: Yeah. And I imagine with recent times, just sort of COVID, I know that HR have had to take on so many more responsibilities during that period, that the administrative burden just would have put a blocker to being able to do any value-add stuff. And I think that's a massive thing for so many businesses.

     

    Joanne Foster: Yeah, absolutely. So I had somebody working for me pretty much full-time just to manage the benefits that we got. And believe me, there weren't that many. But that collation of people trying to opt in to things like cycle to work and childcare vouchers, etc. was just taking up so much of our time having to do the spreadsheets, make sure the deductions were correct, then liaise with; I think we've got 12 payrolls. So you can imagine it was a bit of a mess. So yeah, putting in a platform really made a difference for us in that respect.

     

    Tiree Houghton: Brilliant. Thank you and thank you for sharing that insight. Guy, from your perspective. What other trends are you seeing that's been that trigger point for businesses to make that move to digital?

     

    Guy Clarkson: I think looking at trigger points. I mean, COVID has clearly been a catalyst for a lot of organisations to go through change and to transform much more quickly, I think, than perhaps they would have. Generally speaking, there's probably two main buckets if you like. So the first one being probably someone like Jo, who's a first time buyer of digital, perhaps through mergers and acquisitions or just the business growing the world around the business changing. They've reached a point where actually without digital solutions in place, they just can't achieve the things they want to achieve as a business. And Jo talked about, you know, having one person full-time just managing benefits and deductions and things.

     

    The second bucket if you like, is more second or even third time digital buyers who perhaps have had systems in place. Perhaps the system hasn't delivered against what they hoped it would or perhaps they've outgrown that system. And so we definitely see a lot, a lot different questions, interestingly, as well, with the second and third time buyers, you know, they're often much more inclined to talk about what life after launch looks like, how's the system actually going to work when this thing's live, as opposed to just perhaps what the employee experience is, for example. So I think there's definite differences there.

     

    Another key theme, the move to mobile is undeniable. 99% of all -- sorry, 97% of UK adults, according to Ofcom, have a mobile phone. I think leveraging mobile, leveraging apps and not just an app for the sake of having an app, but actually the reason that employees use the Facebooks, the Instagrams of this world multiple times a day, it’s looking to harness some of those techniques as well that we see out of the workplace to really drive engagement within it.

     

    Final theme I think is financial well-being, is going to very much come back into focus this year. Digital has a key role to play there, whether it's managing salary sacrifice correctly, whether it's open banking, whether it's financial education delivered through digital, clearly with the world around us, inflation, cost of living crisis, digital and financial well-being are very much going to come back into focus very sharply, I think, this year too.

     

    Tiree Houghton: Your last point for me, the takeaway is about it being an enabler. It's an enabler to achieve and to do certain things. And businesses will have that shift where for you, Jo, it was possibly about reducing that administration and simplifying things for you in the first instance. But once that need has been met, then suddenly there's the next one. And that ability to grow probably for you is key. Because if you don't have technology in place, launching benefit after benefit is just not going to be feasible. And it's not something you want to do. And you don't want to encourage it. You don't want to promote it, because you don't want the work of having to administer it. But the technology then removes all of that.

     

    Joanne Foster: Yeah, yeah, absolutely. So we've just done our first annual window in April, and we launched four new benefits in that one window. And we couldn't have done that before. And the response to it was amazing. But yeah, just the speed and the ability to get that over the line in such a short space of time was amazing for us.

     

    Tiree Houghton: And I guess with sort of anything like this, you obviously had a clear need and a clear business case as to why technology was the right thing. But for probably a lot of people there’s still a number of challenges internally to overcome before you can take on a project like that, whether it be sort of getting everyone at different sign-off levels on board and understanding it, or just time, were there any challenges that you felt you had to overcome?

     

    Joanne Foster: Yeah, we did have a few. Well things like IT, merely because of the infrastructure that we've got at the moment that was a little bit of a challenge for us and making sure that it would work across the entire group. Data protection for our business was a key area. But we got over it, we've managed through that process, we've got really good now processes in place, we’re really confident that the data for our colleagues is protected. So that was that.

     

    And then other than that, it's the obvious what you'd expect, it was the cost. So it is an investment. And with any investment, you've got to be able to demonstrate the return on that investment. But actually, our group management board were really supportive, I was really able to demonstrate that return on investment. I got a lot of support and doing that from the team. And yeah, it was a little bit easier than I expected, actually. And we've just done our colleagues survey, just run our annual colleagues survey and the engagement on benefits has rocketed. So I feel like I can stand by that, I asked for the money and we got it. So that was really good.

     

    Tiree Houghton: That's fantastic to hear. And I think the feedback direct from employees is such a powerful thing, because you don't often get feedback from employees unless it's negative. So to be able to turn around to the business and demonstrate that and I guess, where you said that you had one head that was just previously running and administering that benefits, the time that has been freed up there is a pretty strong business case to the success I think.

     

    Joanne Foster: Yeah, absolutely.

     

    Tiree Houghton: Guy, anything to add there?

     

    Guy Clarkson: A couple from me, I think quite commonly we see employers often don't give themselves enough time, so they think about doing digital, they might have an annual renewal in a benefits platform scenario where they need to try and hit that. But perhaps once they engage the IT team, as Jo’s just mentioned there, actually that can slow things down quite significantly. So give yourself lots of time and I think engage IT and the wider stakeholders as early as possible. That's always a good place to start.

     

    I think generally speaking here, we're talking about business case, right? So how do we build a business case that aligns with wider corporate strategy, people strategy, company values, and company culture, whatever that could be? Because if the project you're proposing or asking for budget to deliver from a digital perspective, supports or aligns to a lot of those wider initiatives that the business has, generally speaking, you're going to get a more successful outcome. Digital is often doing multiple things. So it might drive the employee engagement with benefits. But to Jo's point again, it also cleans up administration and reduces risk behind the scenes as well. So rarely are you asking for a piece of software that's only going to deliver one piece of value to the business.

     

    Tiree Houghton: When you start to think about the themes that are big at the moment, and you think about something like ESG, it sits across everything, and it's something that is on the board's agenda, it's on your CEO’s agenda, and to be able to align technology to help deliver some of those pieces is fundamental. And ultimately, it then helps your business case of budgeting, because potentially part of it doesn't need to sit within the sort of core HR function, or a sort of digital budget. So that's a really powerful way of challenging the business when you do come across those areas.

     

    Guy Clarkson: The other point I’d just jump in on again, I would just emphasise that if people are spending their full-time job doing essentially quite difficult, but quite low value tasks just to try and get data correct or a payroll file correct. Actually, if you can take that away from them, they may be able to deliver a much higher value tasks or strategic tasks, for example. And you know, how can you repurpose that resource that's currently doing the administration, because I'm sure Jo's to-do list is plenty long enough and there's all sorts of things on there, and that her colleagues can help out with if you can remove that burden from them.

     

    Tiree Houghton: Jo, touch slightly on the sort of impact that it's had in terms of the people survey, but what's the impact been for you, as well as the business and your employees?

     

    Joanne Foster: Yeah, just on the same theme, really, I think they really, really value that we've invested in technology. And they can see that we're really trying to improve their experience and the options available to them. And it has come back through the survey, the survey is the obvious measure that we've got, but I've had so much anecdotal feedback from people, people emailing me, ringing me just to say thank you, it's really good that I can actually now see everything in one place and I can really understand what I've got. Because we had information all over the place, you know, someone didn't really understand what life assurance they had, what it was, etc., and the value of that and now all of a sudden they do. So in some respects, somebody might not have actually got that much more than they already had. But at least now we know what it is. And that's really made a difference for our colleagues. That's the biggest difference for me. They just feel like they're valued and invested in a little bit more.

     

    Tiree Houghton: The power of technology there is -- I quite often hear from clients similar to you that you can launch it with no new benefits at that point and the plan is to grow, but when you first launch it, you're relaunching everything that has always been there, but employees just didn't know about it. And suddenly they think you're offering this suite of benefits on top of what you did before. In reality, it was just that communication challenge that you had.

     

    Joanne Foster: Yeah, that's exactly it. Yes, I've had calls about things like, oh, this is an amazing benefit, and I’m like, it's been there for ages, you just didn't realise!

     

    Tiree Houghton: Is there anything that you sort of weren't expecting technology to give you that it's done for you?

     

    Joanne Foster: I don't think there's anything I didn't expect. I think it was better than I expected, I guess the reaction that I got to it was better than I expected. And I didn't realise how fast we'd be able to launch new benefits. You know, so when the team was saying to me, yes, we can do those benefits for you next month. I was thinking, gosh, that's a lot, we'll never get that over the line. But yeah, absolutely did, flawless, no issues. So I guess that was the biggest thing for me.

     

    Tiree Houghton: Can I ask how much communication you did when you launched?

     

    Joanne Foster: A lot. We did a lot of communication upfront. So just paving the way really, getting people to understand what was coming. So lots of taster emails, lots of sessions with our leadership teams. I personally did a lot of demos on the system to show them how it would work. And also what I've done a lot of, is managing expectations about the journey. So yes, we've put the platform in as a starting point. But what I've made it very clear to everybody across the business, is this is just the starting point. So actually we've got phases built in, where we will progress over time. So that might be putting new benefits in, adding elements to the total remuneration statement so that people can see exactly what they get, and the value of that, but then also moving on to what I call the sexy side of things, which is maybe operating things like flex pots, that kind of stuff, which we're nowhere near yet, but is where we want to get to.

     

    Tiree Houghton: Brilliant, I think it's so important to take them on that journey, one, to set expectations. But also let them know that this is an ongoing thing. It's not just a tick the box, we didn't put it in because of us, we put it in because we want to be able to do all of this for you and that's a really powerful message. And I guess the other thing, the key takeaway I got is the importance of communication. When you're launching something that's digital, I think it's quite easy for people to think the digital solution does all the work. And it does that communications for you. But actually, the power of that human element alongside something that's digital, the digital is the enabler, it's the platform, but you still need that human contact or that communications wrap-around that then drives that engagement properly.

     

    Joanne Foster: Yeah, definitely. And you need your managers to buy into it, because they need to be the advocate, because I can't personally touch, through comms, 5,500 people, I'm just not going to be able to do it. So what you want is your managers to sort of live and breathe the system, to understand it, to buy in it and to encourage their colleagues to go on and have a look and be able to explain the different benefits to them. So you’re right, you put the system in, but actually you need to educate your leadership teams and your managers to then further support that, to get the buy-in and the traction.

     

    Tiree Houghton: 100% agree. Guy anything from you?

     

    Guy Clarkson: A point I picked up there was almost that, that when Jo talked about how quickly you can implement things. So essentially, you have a foundation through having a platform, but we had a great example of a client when COVID where the first lockdown happened, it was a financial services client and a lot of the employees expressed a desire to donate money to the NHS. So actually very quickly, within 48 hours of them being asked, we were able to actually build that into our Darwin platform in that instance, to allow employees to give an hour's wages. So again, not something that they thought they were going to get when they bought the platform. But by having the platform in place, they essentially just had the vehicle to do that very, very quickly. And much wider than that, we saw COVID communication, a COVID hub, essentially, that clients could add very, very quickly.

     

    And we talk a lot about supporting people in the moments that matter. And I think digital delivery of that kind of thing is you couldn't do it without digital, put simply.

     

    Tiree Houghton: I guess sort of my last one, and Jo you've touched on it before about what you were looking to do. But this is just the starting point. It's about adding new benefits. It's about transitioning to flex pot, it's about utilising the technology to grow with you as a business in whichever direction you go. And I guess it's about utilising the flexibility of a platform to start doing different things on it and use it in different ways. Is there anything else that sort of your ambitions or future goals are around digitalisation?

     

    Joanne Foster: No, I think you know, we're so early in our journey that I can't be too ambitious, if we can -- you know, I’m really happy that we've got everything in one place that we can really start to involve our benefit offering. And then as I said, like you said, moving on to absolute flex pots is our aim. So I think in this day and age, everybody wants to try something, we're all different, we've got different lifestyles and priorities and I just don't think giving people these days one rigid set of benefits, I just don't think it works for people. And I really want us to get to a space where people can choose what's right for them. And you just couldn't do that without digital, it just would be too difficult.

     

    But you know, if somebody can go on and they've got a cash amount for their benefits, and they can pick and choose what's right for them, then I'll feel like I've done a good job. So that's kind of the aim in maybe the next 18 months I'd say, but we've got a lot to do before we get to that. And then the other thing is really driving on salary sacrifice, we don't do enough of that at the moment, for various reasons. But once we get our house in order with things like pension, then I really want to use the system to pull down on the salary sacrifice savings that, us as a business can save, but obviously our colleagues can save as well. They’re our two priorities.

     

    Tiree Houghton: It’s when you think back to where you were before the technology, imagine trying to do either of those things without any technology in place!

     

    Joanne Foster: Yeah, impossible.

     

    Tiree Houghton: And Guy, we’ve obviously got clients that are yet to sort of embark on a digital journey and hopefully this conversation has given them a few steps in the right direction as to what to do and how Jo's tackled things, but for companies who are already embedded on their journey, what do you see as being next for them? What can they aim for?

     

    Guy Clarkson: A few areas jump out, I think, to that question, Tiree. So firstly, people insight, and ultimately it's down to data. So I often think digital is the tool often to capture data. And what you then do with that data, clients generally need to know the so what, what does it mean? How do we interrogate that data? And what does it truly tell us? And what we're tending to see is clients where they've got a platform in place, consulting in place, they want to harness that behavioural data, that claims data, that sentimental data where they can as well, to just elevate the level of people insight that we as consultants can give them. And so there's certainly a trend we're seeing, again, I think data, the hunger for data is ever growing for clients, where they've got the platforms in place already.

     

    Jo touched on diversity, equity and inclusion there, so I think offering genuine choice, so a lot of people are focused on diversity, equity and inclusion, it's a big ticket item that a lot of organisations are kind of grappling with, or have plans in place around. And I think that to Jo's point, offering a list of benefits in that example, and then saying, well we hope there’s something for you, actually is that truly reflective of the culture we want here and is that reflective of our ambitions around diversity, equity, and inclusion? So we are having a lot of conversations around that area too.

     

    And social, I think, the concept around communities, again driving engagement with existing platforms, harnessing social, which I touched on earlier, but also creating communities for colleagues, really learning again from what outside the workplace platforms and apps and things are doing. And we're seeing a lot of interest from our clients who've got platforms in place, just too almost supercharge the engagement levels that they're already enjoying.

     

    Tiree Houghton: And Jo, Guy touched on the data, what data are you using? I know when we spoke before this podcast, one thing that I found really interesting that you said and I really liked, was that you're not looking at the data of how many people are taking up each benefit, because it's not about that, it's not about forcing them into something. It's about giving them that choice. But what data are you leveraging the system for?

     

    Joanne Foster: Yeah, you're right, it's not for me, you know. Yes, I look at the take-up numbers. And yes, I want people to opt into the benefits. But that's not kind of my main driver whatsoever. For me, it's looking at things like employee turnover, engagement scores, and making sure that people feel valued. So the survey I've mentioned a couple of times, that's a big, big number for us, and that'll be my, that'll be what I then manage against and measure for the year ahead. And yes, I'd like to see the benefits increase. And I'd like to think that then the survey results will increase in line with that. But yeah, it's not the fundamental at all. And actually, you know, if you've got people that feel valued, engaged, and they can see that we're investing in them, then you would naturally want to see things like labour turnover reduce, sickness reduce in line with that. So I'm more focused on those side of things if I’m honest than the actual benefit take-up itself.

     

    Tiree Houghton: That's a really good point. And I think it's really important that it's -- just because someone's not taking up a benefit doesn't mean that they don't understand it’s there, that doesn't mean that they don't see value and see that the company care, it might just not be something that they're interested in. So I think it's 100% the right approach to not just be looking at that stat as a measure of success.

     

    I think that's us for today. And I just want to say, Jo, thank you so much for joining us. It's been so lovely to hear everything that you've done, and it sounds like you've done an absolutely amazing job. And it sounds like you might need a little bit of a break before you tackle all of the things on your agenda, but I look forward to hearing how the rest of your journey goes.

     

    Joanne Foster: Thank you and thanks for having me.

     

    Tiree Houghton: Thank you and thank you so much for joining us as well, Guy.

     

    Guy Clarkson: Pleasure, thanks Tiree. Thanks Jo.

     

    Tiree Houghton: Please subscribe to keep up to date with our latest episodes and if you have any questions please do not hesitate to contact us at mercer.uk@mercer.com.

     

    You can subscribe to keep up to date with our latest podcast episodes and if you have any questions, please do not hesitate to contact us at mercer.uk@mercer.com. Explore more episodes in our ‘Energising the employee experience’ podcast series.

     

       

 

Guests this episode

Guy Clarkson

UK Digital Growth Leader

Mercer Marsh Benefits

Joanne Foster

Group Head of Reward & Benefits

Redde Northgate plc

 

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