Milliman Markt Monitor Nederland – juli 2020
Maandelijkse publicatie van Milliman met een overzicht van de ontwikkelingen op de markten die relevant zijn voor pensioenfondsen.
In this episode of Critical Point, Heidi tenBroek, a Milliman employee communication consultant, and Jill Godschall discuss how generational differences, behavioral economics, and technology are driving change in the HR communications space.
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Lesley Pink: Hello and welcome to Critical Point brought to you by Milliman. I’m Lesley Pink and I’ll be your host today. In this episode of Critical Point, we’re going to be talking about employee communications and how generational differences, behavioral economics, and technology are driving change. With us today are Heidi tenBroek, a principal and consultant with over 20 years of employee communications experience, and Jill Godschall, a senior communications consultant, also with over 20 years of experience. Thank you for hosting me here in Seattle, Heidi and Jill.
Jill Godschall: Well, thank you for coming.
Lesley Pink: Let’s start out and just so people who are listening have a better understanding—can you explain what employee communications means?
Heidi tenBroek: Absolutely. This is Heidi. And we communicate to our clients’ employees. So we’re kind of like internal communications except on behalf of our clients. And we really specialize in HR communications. Sometimes when I’m at a party, I describe my work as being a translator and I translate from legalese or actuarial-ese or insurance-ese into plain English.
Lesley Pink: So these are--these types of communications would be about retirement benefits, about health benefits--
Jill Godschall: Right.
Lesley Pink: --really runs the gamut of all the communications.
Jill Godschall: Yeah, a broad-- everything from healthcare to life insurance to retirement to HR change to you name-- anything HR-related is what we work on.
Lesley Pink: And what have you found motivates employees to take action? Have things changed so that what worked 20 years ago doesn’t work now, in engaging people?
Heidi tenBroek: I would say some of the biggest changes is the messenger, you know, who employees find credible in terms of who needs to deliver the message to get them to take action. Many years ago, people had a different view of the company they worked for. The CEO could send out a memo and you would kind of salute and do what you were told. And now it’s really moved more toward peer groups or mentors. People are looking different places for credible information.
Jill Godschall: That’s true. And it’s also how we communicate to employees. You know, when I first started in this, it was all about print. Email was-- I hate to say it-- it was up and coming, but it was. Everything has changed so quickly, but how we’re communicating to employees and how they want to be communicated to also drive employees’ actions and behaviors.
Lesley Pink: And what are some of the differences? Like you said it used to be print, then it shifted to email. I’m assuming now there’s apps. What other things have you seen change in the way you communicate?
Jill Godschall: I think it’s the range of communication channels has really broadened, with emphasis being-- as I said, back with the Boomers when they were primarily in the market, it was print-based. Then it sort of shifted to email and everybody went to email. And then technology came into play and that seems to be where it is right now.
Heidi tenBroek: And I would say that as making things more personalized and targeted is one of our most effective tools. People want to feel like you’re talking to them and that the messaging is relevant to them and not generic. So we do that in a variety of ways. Sometimes it’s print, sometimes it’s video, sometimes it’s getting people together live with a real person in a room for a meeting. But making sure that the information is very relevant to that group or person.
Lesley Pink: And on that note, I’m assuming that with the Millennials now the biggest group in the workforce, they’re wanting different things than Generation X. They’re wanting different things from the Boomers. How has the Millennial generation changed how you communicate?
Jill Godschall: Well, as I said, we’ve moved into the world of technology and Millennials really help drive that change. And with Gen Z coming up quickly and entering the workforce, it’s going to be more important than ever. It’s a must-have now. And HR needs to provide the communications, the way we live, and that’s with our smartphone and on our laptops.
Heidi tenBroek: But I would say that it’s absolutely true that that’s been driven by the Millennials and that big generation coming in, but it’s relevant to everybody. I don’t think anybody-- no matter your age, you have less time, you have more information overload, and I think that folks who are 60 want to maybe hear it quick and maybe watch a video or get the info on their phone as much as the 25-year-olds.
Lesley Pink: So, when you target these different groups, you target by age. What are other means of targeting these groups?
Heidi tenBroek: I would say situations. So especially, when we’re asking people to do something, you narrow it down to only-- if you need somebody who is enrolled in Plan X to take action, just send the information to those people enrolled in Plan X, so that people don’t get yet another thing from HR that doesn’t mean anything to them. You want to really try to get rid of the clutter as much as possible to keep your messages potent when you need to send them.
Jill Godschall: Yeah, Heidi, you make a really good point. So when we’re talking about targeting communications, that’s pushing communication, but it’s also when employees need information. So employees make decisions and they learn about their benefits when they need to. So, during open enrollment and make those decisions at that time. But let’s say they have some kind of a life event. They want to understand what does this mean to me? How does this impact me? So communicating to them about not just one benefit, which is how companies tend to do it in a very siloed fashion. The way to do it is to give them information based on where they’re at, which could be across a broad spectrum of benefits.
Lesley Pink: Right, so, for example, if someone were pregnant--that person would get certain information about childbirth classes and so forth.
Jill Godschall: Yeah. Childbirth, divorce, marriage, retirement. Those are all top of mind for a lot of employees.
Heidi tenBroek: But another one, I’d say, and this is again back with the Millennials, it’s been a little bit of a shift. So many Millennials stayed on their parents’ insurance for so long they didn’t really need to learn how insurance worked. And they are coming to an age now where they have their own insurance and they don’t know how to go to the doctor necessarily. They’ve never used it before. So one of the life events is just “How do I go to the doctor?”
Lesley Pink: So, how do you explain that, for example? How would you explain that to a Millennial what he or she would need to do?
Heidi tenBroek: Well, it depends on the plan, of course, because they work differently, but one of the keys, like Jill was talking about, is having that information where they know where to find it when they need it. They’re not going to pay any attention until they get that rash and they have to go to the doctor. So it’s making sure they understand where to go and then at that point, depending on their plan, making sure they understand are they going to have to pay out of pocket when they go? Is it just a co-pay? What number do they call? If they have a high-deductible plan, which are very common, are they going to have to pay out of pocket? So kind of taking them by the hand and leading them through the process in a really brief, targeted way is important.
Jill Godschall: That’s true for everybody. And I would say in that case, you’re talking about right message to the right person at the right time sent the right way. So in terms of even going to the doctor, for example: I may be standing in the doctor’s office wondering, “What do I do?” High deductible health plans, in particular, can be very confusing to participants. You want them to have a really good experience. S, either, “I can look up something on my smart phone via a portal or an app,” or “I know who to call,” is going to make me feel better about the plan that I’m in.
Lesley Pink: And that is-- specifically, you’re talking about Millennials here who might not have experience using health insurance or using health insurance in that way. What other things are Millennials wanting that maybe Generation X didn’t want? Or Boomers didn’t want? Are there things that Millennials especially are looking for or that Generation X is looking for. I assume as Generation X gets older retirement becomes top of mind.
Heidi tenBroek: I think that’s right. I think that Generation X is getting closer to retirement and thinking about it in a different way. But, interestingly, we’re hearing through surveys that we watch that the younger generation actually are looking for a little bit more security in their retirement plan. They watched those parents and aunts and uncles go through the big recession and try to retire and maybe be unable to or have their retirement severely cut back because of the recession. And so, they’re looking for a little bit more security. They’re looking to understand what they can do to kind of protect themselves. So they’re both concerned about retirement, just different ways.
Jill Godschall: Right. And another way to address that is to provide information using personas. “I can see myself in this particular situation,” either based on age or family status or health status really helps employees understand what their benefits -- how their benefits can help them and what benefits they need to consider, for example, during open enrollment.
Heidi tenBroek: Well, and that’s another good way to weave in storytelling. Storytelling is a very powerful way to communicate with people and it can be a little hard in the benefits or HR realm. But if you use personas and make up scenarios that people can see themselves in, then they can organize the information and slot themselves into the right spot to get the information they need or put themselves in somebody else’s shoes.
Lesley Pink: What’s an example of a scenario that you’ve worked on that really affected a lot of people?
Jill Godschall: I’ll take that one. This, for example, the high deductible health plan, which is what we were talking about. The Millennial that’s coming into the workforce. So often employees will see the high deductible number-- $1,500, $2,000, whatever that may be-- and they just freeze and turn off. But there are other benefits to them that they need to consider that would make that plan a good choice. Storytelling with employees, a real employee telling another employee is so powerful, very powerful.
Lesley Pink: With all of this information-- we’ve got retirement information, we’ve got healthcare information, we’ve got life insurance information. How do you manage the sheer volume of information that employees have to contend with?
Jill Godschall: Having a single go-to source as a foundation is critical. So that portal that’s easy to navigate, contains really clear, simple information to explain benefits that can help tie-- you sort of connect the dots for employees on all these resources and have the vendors fed in through that source. So it’s really that one-stop shop that really helps employees know, “This is where I need to go. I can find the information I need,” and that’s critical.
Heidi tenBroek: And I’d say another aspect of that is setting a very good year-round strategic communication strategy. People will dive deep into information when they actually need it, but sometimes they need to be reminded occasionally that they have these benefits. So doing it in a brief way, maybe targeted, but a little bit of information throughout the year to remind folks what they have so that they remember, you know, when they get into that situation to go dig in deeper and find some more.
Lesley Pink: And you had mentioned earlier that behavioral economics is somewhat baked into employee communications. Can you explain a little bit about how that works?
Jill Godschall: Well, behavioral economics is the study about how people make decisions so that we can help motivate them to make positive changes. To understand behavioral economics, you need to understand how people make decisions. Think of open enrollment: We give people all this information and the tools to help them calculate their out-of-pocket costs and all of that information to make informed decisions. That takes time. It takes an effort to go online and do that. People don’t make decisions that way. They’re not that rational. They tend to make very-- decisions that are more subconscious, they go with their gut, with their emotions. So understanding some of the levers that we can pull using behavioral economics can help drive that behavior change.
Lesley Pink: And of the different communications that you do, what’s the most difficult to explain or to get the message across that, yeah, “This is really important and you need to think about this?”
Heidi tenBroek: I have two thoughts on that. I think disability insurance is one of the trickiest ones because it can be very important and nobody thinks they’re going to get hurt. And it’s a little bit difficult to understand. You get a percentage of your pay, but usually there’s a dollar limit, too, and how that interacts with your salary is-- can be difficult for people to understand. I would say the trickiest, for me, communication topic is changes in paid time off because that is going to get people riled up. And they are already angry the minute you even say the word. So the communication around that is very tricky and super important.
Lesley Pink: So how do you handle that when you know employees are going to get riled up?
Heidi tenBroek: Personalization. Again, you know, show them exactly what’s happening with that bank of time that they consider theirs and what is happening to it specifically for them under the new program, and then just trying to keep it simple, get some key folks out in front. It’s important for them to not feel like HR is doing this to them, that there are organizational reasons that this is important and that all of the organization is behind it. So those are some of the things I would think really important there.
Jill Godschall: Agreed. I think, you know, the same kind of approach applies to healthcare and retirement as well. I mean, it’s challenging to engage employees, period. We’re all incredibly busy. We make hundreds and hundreds of decisions every day to grab their attention and explain a benefit change or a new benefit or taking the time to choose a benefit or planning for the future. That’s a huge challenge. They’re all a little different, but require a lot of intentional, strategic thought around how you’re going to approach communications.
Lesley Pink: And there is-- I’ve been reading in the paper all the time about a retirement crisis. People aren’t saving enough. And certain generations-- like Generation X got completely whacked by the recession, got whacked more so than other generations. How do you try to convince people that, yes, retirement is really important and you need to start saving?
Jill Godschall: It’s difficult, because people-- you know, behavioral economics tells us that people are motivated by the here and now, not the later. So plan design is very important. So the auto-enrollment, people tend to-- there’s inertia. If you sign somebody up for 4% in their 401k, the tendency is they’re not going to go change that election. They can opt out at any time, but they’re not going to. So that’s one thing to keep in mind. And then the auto-escalation. So you’re forcing them to save, you know, all along the way. But there’s different tactics, such as loss aversion. So people don’t like losing money at all. But there’s a much stronger emotional response to loss than to gain. So when people are not contributing enough to their 401k to get to the full employee match, positioning it as a loss can help employees, you know, for example, go and increase what they can contribute to at least get the full match. So that’s one thing. If 70% of people are getting the match and they’re one of the few that don’t, people like to do what the crowd does. So that can help encourage people to take action. And contacting those people directly with personalized, targeted communication and saying, “Sign up, contribute at least 6% to get the full match. Click here.” There’s no decision to make. There’s no steps to follow. It’s a one-click, take action. So using multiple-- thinking through the issue, whether it’s retirement or healthcare or PTO and designing those communications and the messages and the channel and everything together is really what’s key and that’s what we do every day.
Heidi tenBroek: I think another key issue there is to approach your communications with empathy. I think that-- this is equally true on the healthcare side as the retirement side. And to think as you’re beginning to write and tell people something, to not do it in a preachy way, but to understand that it may be very difficult-- people are making decisions between paying their student loans and saving for retirement and paying their healthcare bills and to really come at it with that knowledge that it’s not easy for everybody and making suggestions about small steps they can take. So kind of acknowledging what people are dealing with and helping them see their different options for getting through that to where they want to be I think is key.
Lesley Pink: What are the main things you want people to take away from this podcast? What should they know and what should they learn?
Jill Godschall: So, three things, first of all when it comes to employee communications. Think strategically. Know your audience, know what you want to accomplish, and how are you going to measure if you’ve achieved that goal. So think strategically. Use multiple channels of communication in your strategy. We have four generations in the workplace right now and they all have different needs, yet there are some common ones, too, so everybody wants face to face. That puts a lot of pressure on HR, but technology is a must. Video is quickly becoming an absolute must. And then, use the fundamentals of behavioral economics, from the messaging to you know how you – what channel you use to communicate to employees to help employees make those positive changes in their lives.
Lesley Pink: And what do you find most interesting about this kind of work?
Heidi tenBroek: Oh, I love that there’s something different every day. I think that our work is varied, we get to work with designers on graphic design. We get to work in video. And one of my personal things that I love about it most is that I feel like we’re really helping our clients solve problems. So we get to a little bit feel like the hero to walk in.
Jill Godschall: And I would say what has kept me at this for 20 years—mmm--quite a few years-- is I feel I’m making a difference in people’s lives. That by educating them about all of their benefits and everything that HR does and what the company provides for them, the value can really give them a better life. So that’s what keeps me coming in the door every day.
Lesley Pink: Well, thank you very much Heidi and Jill, for joining us. You’ve been listening to Critical Point presented by Milliman. To listen to other episodes of our podcast, visit us at milliman.com, or you can find us on iTunes, Google Play and Spotify.