Throughout my career, I’ve had the good fortune to work for a variety of industry leading organizations from stratospheric startup Tesla Motors to Fortune 100s Safeway and Washington Mutual. I planted myself knee-deep in managing, analyzing, and creating everything related to employee benefits and have learned more than a few finer points along the way. The common thread across these three companies was a genuine desire and drive to apply innovative, forward thinking approaches to change and improve the way employee benefits are delivered. I’ve reflected on my experiences to give you three take-aways that helped these companies make the biggest impact possible with their benefits and employee experience programs.

Lesson #1: Innovation isn’t easy

Much has been written about long work hours. Stories abound of people sleeping in their cars or under their desks and subsisting on top ramen and frozen vegetables. That might exist for you at some point along the path, but that’s not the type of innovative environment that I’m talking about here. I am talking about an atmosphere that applies a conscious drive for change which can lead to meaningful acceptance of new ideas.

Whether you’re rethinking the value of the way health insurance is delivered to families or trying to disrupt a 100-year old automotive industry, mindfully striving for innovation isn’t cakewalk. That’s because us humans are programmed not to like change and for many, working through innovation doesn’t come naturally. It takes a laser-focused and cognizant decision to examine the way things are traditionally or typically done. To do that, you’ll need to gather data, build a team, prove a case, influence, iterate, fail and, to achieve success, you’ll need to do all of these things quickly with minimal errors and missteps.

In my experience, it all comes down to the team that you surround yourself with. When hiring or building your team, I always advise to think creatively about your problems and look for passion in those you recruit. More important than having “done it before” is an intense drive to solve problems and an underlying interest in the core subject. Early in my career at Tesla, an HR manager said to me, “there are three reasons people come to Tesla. Either they are passionate about cars, passionate about the environment, or passionate about their chosen profession. And, Tesla is the best place in the world to be for all three of those things.” Notice there is nothing about money, benefits or perks. That brings me to the second lesson I’ve learned....

Lesson #2: Top talent doesn’t care about perks (until you take them away)

Rarely do candidates and their families make the decision to change their lives- in some cases moving across the country or world- because of the benefits and perks you offer. Attracting top talent is about storytelling. It’s about having a mission and purpose that a person (and their family) can identify with through their hard work. I have literally witnessed thousands of people join a common mission early on with little more than unlimited cereal and coffee being offered as the perk. And this was in the geographic backyard of arguably the most intense company perk culture on the planet in Silicon Valley. At the end of the day, people want to feel like they are contributing to something bigger than themselves.

Don’t get me wrong, I don’t mean to imply employees don’t care about the benefits offered to them. They must be satisfied knowing that the basics- Health, Disability, Life Insurance, and Retirement- are covered. But in my experience, top talent doesn’t make the decision to join a company because of free lunches and massages on Wednesdays. Keeping that in mind, it is extremely important to construct benefits and perks with care and thought. Once implemented, any experienced HR manager will tell you their sad tale of trying to take something away that people are accustomed to.

It’s also imperative to align benefits with perks. Trust me, employees notice if either appears alien to the company culture and mission. I learned this lesson at Safeway during a program that linked the amount of premium a person paid for health insurance to their biometric measures like blood pressure and cholesterol. Employees scratched their heads wondering why the company cafeteria featured cheap burgers and sodas in comparison to the healthy but pricey salad bar if poor eating habits could potentially equate to higher health insurance premiums. To promote the healthy lunch options, we had to align its costs with the culture we were trying to foster.

Silicon Valley has become legend for perks and what many of my colleagues across the country consider frivolous and extravagant benefits. While I agree that many of the Valley’s largest and most iconic brands along with many wannabe-cool-kids are foolishly wasting time, resources, and money on programs that really do not serve any identifiable goal, I will argue that offering smartly aligned, personalized benefits and perks are the wave of the future. And that brings me to my third and final take-away...

Lesson #3: Let the people choose

We have a lot of choice in our lives. We choose the items, price points, and brands to put into our carts when shopping at Safeway. Every Tesla purchase is made to order, built to the specific requirements of the buyer. Google organizes information to make it individualized and useful. Amazon provides a personalized online shopping experience. Uber and AirBnB tap into excess individual capacity in existing systems to create value.  We all have different needs, priorities, family situations, and interests, so is it so difficult to offer benefits that can be personalized, too?

The traditional way of offering limited-choice employee benefits and perks for everyone (ie. group benefits) is outdated and bloated with waste. Upwards of 30% of compensation costs are funneled to these traditional benefits and American companies spend over a trillion and a half dollars on these inefficient benefits per year. That’s Trillion with a T. And that doesn’t even include any so-called perks. In my own research, most employers are paying anywhere from $7k to $25k per year for a single traditional benefits package. That’s a huge hunk of change and much of those benefits will never be used by the individual if it doesn’t apply to their situation or they find no personal value in it.

​Instead of these antiquated and engorged traditional benefits, smart people are creating systems and methods whereby employees can build personalized benefits packages that meet individual needs and circumstances. Giving people the choice and ability to craft what they need can and will make a real difference in people’s daily lives. Adoption by forward-leaning employers along with regulatory cooperation will finally result in a system for employee benefits and perks that is modern, flexible and valued. A system that looks like the rest of our world... personalized.


This article was originally published at BenefitsPRO

Last week was the 5th annual Human Resources Executive Health and Benefits Leadership Conference from Las Vegas. I’ve attended many events over the years, and there is no better employee benefits-focused event in the nation in my opinion. It brings together engaged professionals for two and a half days of learning, sharing and problem solving. If you haven’t attended it yet, mark your calendars for next April. Until then, here are three trends I noticed from this year’s conference:

Aligning Global Benefits
Companies of all shapes and sizes are trying to simplify the management of benefits for employees overseas. This trend will continue as long as there’s a desire to centralize governance to headquarters, align philosophy, and create a consistent global employee experience. But progress in this arena is tempered by a few current shortcomings which will need to be rectified including a lack of seamless global solutions, an unwillingness by providers to work with small employee numbers abroad, and a shortage of subject matter experts.

Flexibility with Private Exchanges
Despite the specter of being linked to a contentious piece of legislation and the stain of calling something an ‘exchange’, the word from organizations that have gone down the private exchange path is overwhelmingly positive. Giving employees and their families more ownership and choice over how to spend a large chunk of their total rewards dollars is a definite positive. The latest trend? More companies are working with independent advisors to better understand how they can best put to use this new benefits model. I predict that over time the so-called exchanges will morph into what I dub Flexible Benefits 2.0; this will free up even more of those valuable benefits dollars so employees have increased control over how to spend them.

Financial Wellness Matters
Financial Wellness is the new black. Many benefits managers feel the need to do something in this space, not least because financially sound employees are less stressed and more productive in the workplace. Up until now, a lack of solutions and offerings that could move the needle has threatened the viability of the movement. In some cases, former predatory lending schemes and employee purchasing programs masquerade as answers while causing short term damage and a sense of buyer beware.  I’m already seeing new solutions coming to market that address this void. Coupled with funds from long term benefits, this new trend may help many employees meet their most acute, near-term financial needs.

If you’re interested in a closer inspection of these thoughts and more, I had the opportunity to sit down with HR Happy Hour for a discussion during the Benefits Leadership Conference. Check it out on the podcast below: