“In times of crisis, everyone has a part to play. You cannot live your life just for you. You are part of a whole. You are part of a community and you must do your part.” Mel Brooks - Actor, Author, Comedian, Producer and Veteran of WWII
 
On Wednesday afternoon, April 8th, 10 global employers joined Lockton consultants on a virtual WebEx meeting to discuss the unique challenges of managing global benefits during these hectic times.
 
Several concerns were shared as well as the creative approaches and solutions implemented by these employers in the following areas

• Global Transition to Work From Home (WFH)

 
Safety and protection of employees, families and communities are paramount to employers.  Many were well prepared from a technology standpoint with well thought out and implemented infrastructures, security protocols (Zoom’s issues are of an ongoing concern). The largest challenge surrounds care and education of children with day care and school systems shuttered during the crisis.  Employees need to balance the requirements of work with the needs of their families. 
 
“I am now apparently running a daycare center as well as doing a full time job. I have a 2 year old boy, an 8 year old daughter and a 40-something husband with a 50+ hour a week job in software QA. My husband is doing his job remotely as well, so we spend our days switching off for whose turn it is to try to work in the living room while our son plays. I am a WFH veteran, having done full time WFH for my previous employer for 5 years, so I have a good home office set-up, however I have never had the kids home while I was trying to work. There is a lot of logging in after the children go to bed, after 9 PM. I very much miss my 8 AMs in the office as well as the lobby Starbucks at about 2 PM. I do not miss the T, however.”
 
While virtual meetings and cloud infrastructures help, companies have introduced additional flexible work and leave programs spanning between two weeks to one month with usage in hourly increments. In most cases, these programs are used for managing both illness and the challenges of caring for and educating children while working from home.  For employees who cannot work from home (healthcare, manufacturing, distribution, food services and other essential workers), employers have implemented shift rotations, increased as well as decreased shift hours, expanded work weeks.  Employees are responding positively to employers who have supplemented their compensation, resources and benefits, including free or low-cost tools that they can access remotely (e.g., online children’s education resources, telehealth, etc.). 
 
This crisis is affording employers the opportunity to increase engagement as well as double down on communications.  Of course, some employers are not willing or able to offer these enhanced services.  Employers should weigh these risks when the economy opens back up as they may see increased turnover, higher costs and lower productivity.

• Stress and anxiety through this crisis

 
Business and employees’ personal and work lives have suddenly and deeply been disrupted over the past few weeks.  Many employers have ramped up communications across a multitude of channels (email, print, video, text, social media).  These stresses are further complicated as many employers have had to implement furloughs, layoffs, reductions in work hours, reductions in compensation and benefits as well as suspensions of business in certain geographies. 
 
To help alleviate some of these stresses, many employers are ramping up their global EAPs which can provide significant value when fully deployed including webinars, counseling and other resources.  There exist significant capacity constraints with EAPs who are not currently staffed nor are their business models architected to handle these sudden spikes in demand both at the employee and employer level.  Some EAPs are implementing hotlines with limited scope to answer coverage and access questions related to COVID-19 as well as expanded mobile tools and web site blog support.  We believe that EAPs will ramp investments in AI and chatbots through and after this crisis.
 
“I have suddenly found myself implementing 4 global EAPs for clients and many others are considering implementation.”  Lockton Global Benefits Associate

• Telehealth demand is and will continue to accelerate

 
Employers are evaluating strategies across the entire total rewards spectrum to meet employee needs and achieve financial objectives.  Additional services to enhance the member’s experience and offset member financial responsibility include telehealth and virtual mental health services.  Global employers are finding a mixed bag to these services as local availability varies and no single provider offers telehealth to all local groups in multiple countries. 
 
Given increased internet access, aging demographics and rising healthcare costs, our employer panel agreed that pursuit and expansion of global telehealth is on their agendas.  According to Optum’s April 2020 on employer sentiment, many employers are offering employees 24/7 mental health support (57% of survey respondents) while clinical services such as telemedicine with 24/7 support are offered at a lower rate (43% of survey respondents). 
 
Before the COVID-19 pandemic, both Bain and BCG weighed in on the expansion of telehealth and global technology usage to bolster healthcare. 
 
As late as February of 2020, Bain illustrated that according to US physicians…
 
17% were using telemedicine
40% weren’t using telemedicine but were planning to within the next 2 years
 
20% were using remote patient monitoring
35% weren’t using remote patient monitoring but were planning to within the next 2 years
 
Given the relaxation of regulations regarding provider licensing and cross border practices / liability, we expect these utilization figures to jump substantially.  Lockton is already seeing this increase in our clients’ utilization rates.

In April of 2019, BCG “identified four high-priority opportunity areas in which AI tools could be scaled successfully and impactfully in low-resource contexts:

• AI-enabled population health: analyzing and providing recommendations on population health data; e.g., surveillance and prediction, population risk management, and intervention targeting
• Patient virtual health assistant: assisting patients to direct their own care and wellness
• Frontline health worker virtual health assistant: augmenting health workers' expertise to direct patient care; e.g., triage and symptom-based care recommendations
• Physician clinical decision support: providing more specialized expertise to generalist physicians; e.g., enabling a GP to read diagnostic images

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• Buyer Beware!

 
We are seeing a sudden proliferation of new Coronavirus-related insurance policies. Some of these are designed to supplement gaps in employer-provided private medical insurance plans and others are similar to hospital indemnity cash plans sold in the U.S. The need for such new policies will need to be evaluated in the context of an employer’s existing benefits package, on a country-by-country basis.
 
We are also seeing the emergence private companies offering Coronavirus testing services.  These have not always been approved by local health authorities, and their use by companies raises a number of issues which could have multiple implications.  A well-intentioned employer looking to protect the safety of employees as we start to return to work could create unanticipated risk around data privacy, test reliability, and the recommendations of local health authorities.
 
As employers prepare to return to work we anticipate that

• Benefits will quickly be re-shaped by employers, markets and governments
• Global Growth will be challenging
• Acquisition pace will rise as cash rich / low debt / larger companies will soon be ”going shopping”
• Supply chain / manufacturing / services diversification is already occurring
• The crisis is the first material test of stakeholders vs. shareholder orientation
• Automation will increase as the 4th Industrial Revolution accelerates

 
Thank you to everyone who participated in Wednesday’s meet up.  We aim to continue these virtual sessions in the coming weeks.  Feedback is always welcome. 
 
If you are interested in attending our next session (targeting the week of April 27th) and could spread the word, that would be great.  All with a stake in Global Benefits are welcome.

​When I started this website in mid-2019, I had no idea the “Future of Work”, employee benefits, and our world would be so impacted by the global pandemic, COVID-19.  My thoughts and focus were on the impact technologies such as automation, AI, mobile, robotics, digital biology, blockchain, global gigabit networks and others would exponentially grow and change the nature of work.  Little did I think about or know how a global pandemic, an invisible enemy, would amplify the technology changes that are sprinting ahead.

A week ago, I commuted to the office.  I also worked from home, held meetings with clients, colleagues and partners, booked travel, planned for upcoming conferences, ate lunch at the restaurant in our lobby, held a budget meeting and was onboarding a new client.  My older children were off at college, my youngest was more than halfway through Junior year in High School, my wife was managing the Westborough Girl Scout cookie sales program, and I was looking forward to spring, golf, volunteering, gardening, graduations and a whole host of other activities.

This week I’m fighting for Wi-Fi bandwidth with three children doing online learning after being sent home from high school and college. My wife Pam and I are trying to figure out how to have five separate “home offices” for our family- three of whose lives have been uprooted from forces beyond their control.

​Through technology, we are better prepared to be more productive working from home with networks in the cloud, video meetings, social media tools. How many more times have you checked Facebook or LinkedIn in the past week?  How many online meetings have you participated in?  Played Zoom Bingo yet?

​I’m thinking about those folks that can’t log in and do their jobs.  According to the Bureau of Labor Statistics, only 29% of American workers can readily work from home. On the front line of this crisis are the healthcare workers; nurses, doctors, assistants, technicians, therapists, pharmacists, sanitation workers, dieticians and cooks.  I’m also thinking about grocery store employees, truck drivers, train engineers, merchant marines, farmers, fishermen, warehouse employees, delivery folks etc. all thrust into harm’s way.  They have always been critical yet oftentimes overlooked components of our economic engine.  I must confess, I took their positions and services for granted. I hope I won’t do that going forward.

I’m hearing people use the phrase “when things get back to normal’ or to the way things were before this crisis.  I don’t think we’re going back to “the way things used to be”.  Work will be changed significantly following this pandemic.  I yearn to see my clients, associates and colleagues in person.  Will employers be really roll back the change to remote work? Will employees want to do that?  I don’t think so.  Just as we got comfortable communicating via email, mobile phone, text or apps, so we will get comfortable communicating via online meeting.  I wager that these online meetings tools will soon be more usable, offer more functionality as we get in the groove of their use. Productivity will grab hold of this new way of work and accelerate. 

At last week’s Future of Work conference in California (conducted virtually by the way), futurist Peter Schwartz summed it up, “We are conducting a natural experiment.  One we would prefer not to have conducted. But we’re going to learn the hard way, rather quickly and by necessity, everything that can be done remotely will. … We’re not going back to zero afterward. What do we learn out of all this in terms of how our society can change?”

As we live through these events and transition into what comes next, there’s no going back.  As I wrote in October, change in our exponential world happens gradually and then suddenly.  Man, I did I underestimate this change.  I think it’s safe to say we’ll be in for more "telecommunicating", flexible work schedules, increased paid leave time and a reduction in corporate travel.

​Lots more questions than answers are unfolding before us. Until we meet again, I hope life finds you safe, healthy, hopeful and grateful.  

Chelsea Piers on Manhattan’s lower west side hosted CBInsights “Future of Health” conference On October 2nd and 3rd.  Reviewing the agenda over a cup of coffee, it became clear that this event would highlight technology’s promise, threat and opportunities in healthcare fueled by an abundance of capital looking for a home.

Why healthcare?  Why not.  Every aspect of our lives is being impacted through technology.  As US healthcare spending approaches 20% of GDP, an aging global population and disparate access to healthcare, technology holds a promise to revolutionize health in this 4th Industrial Revolution.

Walking the few blocks to the sessions, I thought about Peter Diamandis and his thesis on technology that it “(Technology) takes what is scarce and makes it abundant.”  Countless examples come to mind whether it Moore’s Law and computational power / costs or the story of Napoleon III serving the King of Siam on Aluminum dinnerware (Aluminum was more valuable than gold or silver at the time and that’s why six pounds of it sits atop the Washington Monument) or the fact that laboratories can now produce flawless, harder diamonds than the Earth, coal and pressure can.
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Technology will democratize healthcare, providing broader access to services, lowering the costs, improving the quality and disrupting the current network in ways that we can see and even more that we likely cannot yet see.  To deny these changes is burying your head in the sand.

During his keynote address, Anand Sanwal, CEO and Co-Founder of CBInsights made clear that a) “Technology is no longer just about supporting the business. Technology is the business.” and b) adoption, disruption and opportunities will happened faster than we think.  Just as Hemingway muses on bankruptcy in The Sun Also Rises, it happens “gradually, then suddenly.”  Look at those adoption rates for Gmail, Facebook and Ping An Good Doctor!

​What healthcare tech will be next to accelerate like a hockey stick? Telehealth? Wearbles? Oscar? PillPack? Google?  Amazon?  Apple?  Well, last January, Apple CEO Tim Cook did say about their future, “Apple's greatest contribution…? It will be about health.  We're democratizing it. We're taking what has been with the institutions and empowering the individual to manage their health."  That’s a long way from PCs, iPods and Apple Music or is it?

Returning to “Technology is the business”, it is remarkable how many healthcare firms are embracing technology, data, analytics, AI, mobile et al to define their businesses and guide their decision processes.  MIT agrees stating in the Harvard Business Review “In particular, companies in the top third of their industry in the use of data-driven decision making were, on average, 5% more productive and 6% more profitable than their competitors. It was statistically significant and economically important and was reflected in measurable increases in stock market valuations.” 

Dr. Luca Finelli of Novartis says “In reality, we are a data company.  We are used to generating and working with huge amounts of data, analyzing it, and using this knowledge to research and develop new therapies.”  At Northwell Health, New York’s largest healthcare provider and largest private employer, Dr. Puma Prasad states “We are a tech company offering health services.”  Health insurer, Anthem, has been heavily recruiting Apple employees to help modernize and digitize their business.  If healthcare firms do not embrace tech across their enterprises, they might be the next Blockbuster or Blackberry or Edsel.

​On the evening of October 2nd, I was invited to attend a roundtable discussion sponsored by Collective Health featuring Jeff Immelt who earlier in the day kicked off the Future of Health sessions.  Immelt’s was an interesting perspective given that he ran the GE healthcare business for a long time before becoming CEO and responsible for the benefits of GE’s 250,000 employees and thousands of retirees.  He described how every aspect of healthcare is being scrutinized, augmented, disrupted, improved and replaced through technology.  Investment capital is abundant and flowing into the space like a flash flood.  Why?  Well our costs are too high, access is still limited, solid quality metrics aren’t standardized and the whole system is opaque.  
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What does this mean for employers?  According to Jeff, employers need to treat employee benefits as an integral part of their business.  In 2009, benefits costs at GE were higher than the cost of steel.  Focus, analysis and benchmarking should be placed on a) Cost per employee b) Absenteeism and c) Turnover.  “Consultants are thought leaders and companies should “lean in” when their consultants speak.”
 
My head was swimming after these few days in New York.  The amount of optimism, capital, opportunity in the healthcare market is almost indescribable.  You can see the session summaries on CBInsights twitter pages using their #FutureHealth hashtag.  I’ll end with another quote from Jeff Immelt which IMHO encapsulates the event, “Healthcare will consume 25-30% of our economy and we ‘ain’t seen nothing yet’.  It is the quintessential challenge of our generation – how to expand access, manage cost, know and promote quality, expand globally and blow the clouds of opaqueness away.”    The winds are blowing.  They may be starting gradually but suddenly…

Summer is winding down here in New England. The kids are back to school, the days are getting a little shorter and the commute to Boston is back to a familiar grind. At Lockton, we are working with clients; finalizing vendors, plan designs, rates, contributions, etc. In the build up to Open Enrollment and the 2020 plan year I thought a good post summer topic would be an ongoing challenge that all our clients are facing and how we might be able to help…Pharmacy Management. 

The pharmacy market is changing rapidly and at times might be difficult to follow. In July, in conjunction with NEEBC (New England Employee Benefits Council) we co-presented on this topic with one of our partners, RxBenefits. Hopefully, we shed some light on what’s happening and what it means to employers and their people. 

The impact of recent PBM/Carrier transactions will add even more complexity to an already complex market. As the PBM market consolidates (Cigna buying ExpressScripts, CVS buying Aetna, and United Health’s expansion of Optum Rx), disruption  will occur as these companies convert clients, systems and deploy new solutions.  Understanding and navigating these massive entities was already difficult prior to this consolidation. It will now require additional focus, scrutiny and oversight. They will also undoubtedly introduce new models which will require examination and due diligence as their value will only be proven out down the line.

Of all healthcare spend, pharmacy is the most volatile as it’s expanding to become the fastest growing components of healthcare. In 2008, pharmacy represented 10% of total health spending.  In 2018, it has swelled to 19%. The average gross cost per Rx was $72 in 2008 and in 2018, was $126 (75% increase) and Rx costs per member per month (PMPM) also increased by 75% from $66 PMPM in 2008 to $116 PMPM in 2018.

​The fastest growing component with the pharmacy benefit is the utilization of specialty drugs. While these drugs only comprise just over 1% of total utilization, they account for 40.2% of the total pharmacy spend.  Spinal Muscular Atrophy can be treated in newborns and toddlers through Zolgensma that is being priced at $2.1 Million.  Spinal Muscular Atrophy is a horrible disease and great innovations in specialty drugs as well as gene therapies can cure them.  These treatments, however, are incredibly expensive.

And more drugs are on their way to the market. The graph below illustrates drug patent expirations from 2015 through 2023: $39 Billion “opportunities” from the manufacturers’ perspective or, said differently, $39 Billion in costs from the plan sponsor and member perspective.  The pipeline in the gene therapy sector is also robust and these treatments will carry 7 figure pricetags.

Given all of the challenges in Pharmacy and Drug Management, we highly recommend that employers implement an active pharmacy management program through a qualified broker, consultant or other 3rd party. In this way, employers can sustainably achieve the best clinical outcomes and the lowest possible costs. Programs should be designed to ensure that the right person receives the right drug at the right cost for the right reasons.

A proactive transparent strategy focused on clinical appropriateness can effectively generate sustainable value across the pharmacy plan with minimal impact on members. The strategy should focus on four main pillars to success – Formulary Optimization, Utilization Management, Managing High-Dollar Claims and Leveraging Manufacturers’ Assistance. Plus, you should be maximizing the volume of rebates through the PBM.

A comprehensive clinical solution is best positioned to address both current and potential pharmacy challenges as well as deliver the best healthcare and financial outcomes.  In this way, employers can maximize the value of their pharmacy benefit that yields:

• Plan sustainability
• Cost Effectiveness
• Optimal Clinical Outcomes
• Balance of savings and access

If you’re concerned about the effectiveness, impact and cost of your pharmacy program and would like to learn more about Lockton’s approach to Pharmacy Management and how we might be able to help, please reach out.

3 months of bad skiing

Since this season can be fleeting, I thought for July and August, my readers might enjoy some Lockton curated content for light summer reading and I would enjoy the weather.

Therefore, I give to you the 2019 Lockton Benefits Survey – Executive Summary.  A best seller since April!

Inside, you’ll discover quite a bit including these 3 key takeaways…

• Opposing priorities of cost control and value to employees pose real challenges. 
• An area of opportunity is to increase the understanding of and response to the different needs of workforce generations when it comes to benefits features and communications.
• Employers should consider implementing strategies that could be highly effective in helping them manage those costs while still providing value to their employees. As always, a strong communications plan can help manage the disruption to employees.

If you’d like more information including the full findings of our survey, please reach out and we’ll get them out to you.   See you in September!

Last week, I sent an Outlook invitation to a client’s Head of People and her team for our standing QBR (Quarterly Business Review) meeting.  I received this response, “We’re just too busy with Recruiting right now to meet.  It’s all hands-on deck with my team. Let’s push to late summer / September.” These QBR’s are part of our standard client delivery methodology and are events in which clients find a lot of insight and value, so I was surprised. 

But maybe I shouldn’t have been. You’d have to be trapped under a rock or stranded on a deserted island to not realize that unemployment rates are at historic lows and competition for talent is fierce. Here in Massachusetts these pressures are among the highest in the nation.

What happened next was even more surprising!  It happened again…with another client…with the same issue, “We’re too busy with hiring talent right now.  Let’s skip to Q3”. 

This made me start wondering what specifically these clients were dealing with, and I found some answers at a pair of conference sessions.
I was scheduled to attend an upcoming breakfast seminar on the topic of hiring entitled, “How to Hire Talent in a Tight Labor Market” sponsored by Broadreach Staffing Solutions.  Timing was great and so was the content.
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Right off the bat, it became clear that organizations today must handle a more complex mix of business requirements as well as requisitions which are highly specialized and, in many cases, unfamiliar to the recruiting teams. For instance, 20% of current requisitions are for roles with which the recruiters are unfamiliar, and it takes 38% longer to fill these unfamiliar roles. In addition, 58% of the heads of recruiting have difficulty acquiring the talent to maintain the current business and 64% of the heads of recruiting are having difficulty acquiring the talent to support a change in strategy. And finally, specialization is the name of the game where 71% of organizations recruit for more specialized roles than they did five years ago.
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I next had the opportunity to attend the Flex Summit sponsored by Fuze here in Boston. It was a great experience focused on engaging in the future of flexible work.  The closing speaker that afternoon was Liz Kiehner of IBM who spoke about how their clients are digitizing the workforce.  I wrote about IBM’s success and investment in recruitment digitization as well as optimization back in my March blog (“HR recruits AI”).  

According to Ms. Kiehner, IBM has realized a net benefit of $239 million and an ROI of 195% since “re-imagining HR with cognitive technology”.

We know that technology will continue to augment and disrupt our future work, and employees will continue to demand that their work experience mirror the daily consumer experiences.  Investment and innovation will need to stretch across the HR domain from Talent Acquisition, Development and People Operations. Not only will these investments free up HR’s time during these critical “battles” for talent but the payback is significant.  

As the result of these recruitment challenges, we’ve pulled together the following recommendations;

1. Move away from fixed planning and resourcing
2. Focus on Talent trends (where the puck is going) and not just current business needs
3. Make the investments in digitizing and integrating the recruitment process with your HR systems and the overall business
4. Following these investments, develop sophisticated talent analytics
5. Define your best employees and model them against ideal hires
6. Distinguish between applicants and candidates
7. Treat the process as you treat your customers
8. Onboard, onboard, communicate, communicate through at least the first quarter of employment

We’ve since re-scheduled our QBR’s and have incorporated more broadly how we can assist clients across their HR domains.  We are prepared to help organizations as they evolve to Digital HR.  I’m sure there will be more surprises and excitement ahead.  Can't wait.

“It’s a small world…I wouldn’t want to paint it.”  I still laugh thinking about Stephen Wright’s deadpan delivery of this classic one-liner.  Returning from Lockton’s Global Benefits Forum, my head was still spinning from all the great content that was delivered at these sessions in Chicago (more on that content at the end of this blog).

During the sessions, at breaks and meals, clients kept sharing that while the world may be small in Stephen Wright’s view, it is growing immensely complex regarding Human Resources and employee benefits.  Global growth is accelerating and as markets, clients and competitors expand, employers are having to meet their constituents where they are.  Increasingly, they are meeting them outside the United States.
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It would be nigh on impossible for me to sum up all the content of this forum in a short blog, however, I saw 2 major themes echo over the few days which center on the changes to the world’s demographics…
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• we are getting older because
• we are getting healthier  

The world is aging incredibly fast and this aging is reshaping the global workforce.  By the end of the 21st century, the populations of the Americas, Europe and Oceania will remain relatively flat while the populations of Asia and Africa will continue to rise.  The African population will see the largest increase and by the end of the century, it should be roughly the same size as Asia.  Nigeria will be the world’s 3rd most populous nation behind India (#1) and China (#2).  These shifts will set up 3 stratifications of a) lower income nations / geographies, b) middle-income nations / geographies and c) higher income nations / geographies.  

​For the lower side of the scale, the struggles will center on internal conflicts and how to invest in education as well as productivity.  Those in the middle will likely struggle over savings rates, productivity gains, labor force participation and increasing health care costs.  At the higher end of the scale, the struggles will include pension / retirement costs, intergenerational polarization and rapidly rising health care costs.
 
Regardless of income stratification, all nations, geographies and continents will have to embrace the challenges of longer life expectancies.  Pension costs are going to soar and it is likely that governments and employers have not fully projected for this growth.  Naturally, as we age, we incur more healthcare expenses.  Once again, governments and employers will feel these health care pressures.  Case in point, most Germans are covered by statutory medical insurance system and care is delivered with reasonable cost and quality.  However, in recent years, reductions in statutory benefits saw the development of private medical insurance markets to fill this gap.  Employers are offering these solutions due to the positive impact on the employee experience despite the lack of favorable tax treatment.
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And Germany is not the only nation struggling to provide wide access to quality yet affordable health care.  Here in the US, it will be a central issue of our national conversation for the foreseeable future.

​Technology and productivity will be more globally abundant and could be a solution to many of our problems.  However, technology and productivity will carry risks and problems of their own.  Through infrastructure advancements, nearly everyone on the planet will have access to the web regardless of location.  Healthcare will be accessed online.  Surgeries will be performed via remote connections through human, AI and robotics integration.  Pharmaceuticals will be delivered via drones.  Wearables and sensors will give us broad information on our bodies and so much more.  Governments will strive to stay on top of these developments but will lag technology’s innovation.  Even in nations where access to health care is universal, as the emerging private health insurance market in Germany proves out, these are challenges which will require public and private partnerships, cooperation and coordination.  Employers will continue to play a pivotal role in these developments

I wish I could share all of the terrific content from the Global Forum in this post.  Well, here’s the next best thing: the session topics (a photo from the conference app - great tool, btw).  If you see something that peaks your interest, please reach out and I can send you additional information. 
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Small world: sorry Stephen, not so much. 

At a recent seminar sponsored by Prudential, Paul Braihm, CFP of The American College, detailed the challenges of declining US productivity and its main culprit – financial stress by employees that occupy their waking (not just working) hours.  With talent at an all-time premium and unemployment rates at historic lows, employers are concerned with making sure their people are healthy, mindful, present, engaged and productive at work.  Dr. Steven Covey, Guru of Productivity, said “Having spent my career helping individuals and corporations increase productivity, I’ve become convinced that one of the greatest, unnoticed drains on individual productivity is the distraction that financial stress puts on people.” 
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These stressors affect people at all levels of organizations including the “Highly Compensated”.  All employees can be affected and therefore, all employers can and should provide help. A January 2019 State Income & Policy Report from non-profit ProsperityNOW showed that 43.3% of Massachusetts households did not have emergency savings, 49.2% of renters are “cost burdened” and 9.3% of adults could not see a doctor due to cost despite the lowest uninsured rates in the nation.

​Financial stress at work costs employers a lot of money in terms of absenteeism, tardiness, presenteeism, poor health, lower pay satisfaction, higher turnover, lower employee morale, accidents, theft, substance abuse and loss of customers. However, there is an undiagnosed and growing crisis brewing in delayed retirement. 

​On April 4th, Lockton sponsored an evening of stimulating conversation amongst Global Benefits colleagues featuring fabulous food and drinks with stunning views of Boston Harbor. 
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Our event started with an hour of engaging peer to peer conversations and then we settled in for dinner.  Nick Dobelbower, Lockton’s guru of Global Benefits, led a structured discussion on the latest Brexit issues as well as developing Gender & Diversity issues for US Multinationals.

Regarding Brexit, Nick and his colleague, Selima Crum, authored a prescient article in last March’s issue of benefits magazine assessing the impact of Brexit for US firms focusing on European business, their regional talent strategy and employee benefit plans.  A link to that article can be found here 
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​Nick addressed current known implications with respect to Brexit for employers in the following categories

• Immigration & Residency
  • Immigration status EU/EEA/Swiss in U.K
  • Immigration status of U.K. persons in EU/EEA/Swiss
  • Recruiting talent
• Employee Benefit Plans
  • Mobility
  • Health Insurance vs. Business Travel vs. Leisure Travel and other employee benefits (including retirement)
  • European works councils
  • Employee share schemes
• Other Implications
  • Data privacy, GDPR and U.S.-E.U. Privacy Shield
  • Increased costs to business

 
During dessert we shifted the discussion more broadly on another topic of US and global interest. Nick discussed the growing concerns around Workplace Diversity with a emphasis on Gender Parity.

ground (sorry for the pun) with these discussions as well as others like the concerns of rising nationalism, changing nature of work through technology and demographic changes.

If you'd like a copy of the presentation that Nick delivered, would like to discuss these issues in greater detail or join for our next Global Benefits Confab, please reach out.  We hope that you can join us on this growing list of leading Boston area employers participating in these sessions.

The challenges of global business growth are being driven by factors such as

• Tightening labor market
• Ageing population
• Low natality
• Social system funding
• Retirement adequacy

As a result and in conjunction with changing social and political views, thankfully we are seeing businesses increase women’s participation in the workforce leading to rethinking issues around

• Pay parity
• Adequate maternity leave
• Increased paternity leave and take up
• Flexible work
• Work-life balance

Through these initiatives, global business hopes to see

• Greater financial stability
• Broader business growth
• Career continuity parity
• Increased productivity
• Enhanced recruiting and retention

On the last day of the recent WorkHuman conference, 3,000 attendees were buzzing with excitement waiting for Brené Brown (https://brenebrown.com) to take the stage as the closing speaker. The WorkHuman conference attendance has swelled in recent years, and with speakers like Brown, it’s no surprise. The content for those charged with leading people functions at employers is superb. It’s a bucket list event if you’re in Human Resources.
 
Brené spoke of leadership and how future leaders need courage. To be courageous, she believes you need to be vulnerable. Whether she’s talking to Special Forces units, top global athletes or rooms full of school teachers, when she asks the question, “have you ever witnessed an act of courage without vulnerability?” the reply is always – No.  The world is changing fast and we need to be vulnerable enough to say we haven’t got it all worked out.

Technology has its own compounding theory in Moore’s Law which is bearing down on us with exponential speed.  Many of the advancements, issues, and opportunities created by technology will effect organizations before employers are ready to plan for them much less address them.  While some organizations are already looking to these next generation solutions, many are just at the starting line. But the return on investment has never been clearer.
 
For instance, at CNBC’s @Work conference in April, IBM’s CEO Ginni Rometty, stated that AI will change 100% of jobs.  Not eliminate 100% of jobs but change or augment these jobs.  IBM took a nontraditional path by starting their implementation of AI, with HR. They saved $300M from an end to end AI implementation targeted on making HR completely employee centric. Rometty said, “You (IBM) don’t do things to people but for them, it’s consumer centric because of how we apply the AI and there’s productivity on the other side.” 
 
This is a stunning example of the changes, benefits and hard conversations that AI will bring to business. IBM replaced routine HR work with more strategic work, and the new AI technology enabled them to reduce HR headcount by 30%, which obviously had a negative effect on the existing staff.  However, the remaining HR staff saw increases in both their skills and compensation. The HR team at IBM had the courage to have honest conversations about challenges and opportunities facing their business and then took take decisive action.

Seems odd that a blog directed at HR folks would highlight these steps as success but IBM HR stood up and decided that while it affected staff in the short term, the augmented work through AI added incredible value with respect to their core mission of attracting and retaining vital talent in the long term.  While the full details of their plans were not divulged, it appears that they, through AI, "flipped the script" on the Recruiting / Onboardong processes.  Rather than having candidates search for jobs that match their skill set, resume and experience, AI takes that same skill set, resume and experience (along with available social media and online history) and matches it to jobs where they have found success with similar employees.  Recruiting, retention and overall job success rates all go up!  Sounds like a win to me.
 
You can check out the full CNBC interview with Ginni Rometty here and learn more details about how IBM CHRO, Diane Gherson implemented AI here 
 
At WorkHuman, HR leaders were talking about strategic initiatives that will require Brene’ Brown’s type of courage.  These leaders are focused on evolving culture and strategy, diversity & inclusion, pay equity, gender Issues, elevating the employee experience, and eliminating bureaucracy, plus all the usual suspects of recruiting, retention, development, compensation, rewards, succession and compliance.  To many of us, these leading edge topics are uncomfortable - driving a natural instinct to shut them out, bury our heads in the sand and hope it all passes.  But the train has left the station, and as Dr. Brown suggests we need to “embrace the suck”. 

​It’s an exciting time to be in HR as well as to help support HR and businesses through the rough seas.  At times, it might suck but we’ll need to muster the courage to be vulnerable and brave and help create work of the future.  There’s a lot riding on our efforts