Staying ahead of the competition requires a savvy approach to maximizing employee performance. One way of gaining insight into a business’s overall health is by benchmarking benefits and employee performance. What does this process entail, and why is employee benefits benchmark reporting important for business success?
Employee performance metrics help organizations measure and understand how their employees contribute to their overall success, identifying high performers and areas for improvement.
Similarly, benefits benchmarking provides a standard against which the competitiveness of the business’s benefits offerings can be measured. The information gleaned by these processes can be combined for a deeper analysis of attracting and retaining top talent and getting the most out of your team.
About Employee Benefits Benchmarking
Employee benefits benchmarking is a specific type of benchmarking in which an organization’s benefits are carefully compared to those of peers and competitors. It shows organizations where they stand within their market.
The process involves collecting, analyzing, and comparing data on the employer’s different benefits. It helps the employer establish that their offering is competitive and in line with the prevailing industry standards.
This type of benchmarking analyzes retirement plans, paid time off, and health insurance. Other perks are typically included as well, and they can vary depending on the industry and the employer.
Data points might include employee contributions, various options available, and specific coverage levels. This information is highly relevant to human resources professionals and CEOs. It can help them make smarter decisions and negotiate with benefits providers. It can also inform policy development and budgeting.
Common Metrics for Employee Performance
Employee performance benchmarking uses different metrics than benefits benchmarking, as it focuses on quantifiable measures of how effectively employees are carrying out their roles.
Here are some of the most common metrics for employee performance:
Productivity Rates
A business’s productivity rate highlights the amount of work its team can complete within a specific period of time, which can provide insight into employees’ efficiency. This also connects to benefits benchmarking in the sense that the quality of the benefits provided can influence productivity. For example, good mental health benefits can prevent burnout and keep employees mentally sharp.
Employee Engagement Levels
Another metric is employee engagement, which reflects the degree of emotional investment employees have in their work and the company that employs them. Those with higher engagement levels tend to have lower absenteeism and better profitability and performance.
Turnover and Retention Rates
Employers should also closely examine their turnover and retention rates as these are strongly associated with employee satisfaction. High turnover rates might indicate that benefits are falling short and employees seek employers with better offerings.
Metrics for Measuring Effectiveness of Benefits Programs
Here are some of the top metrics for measuring the effectiveness of an organization’s benefits programs:
Employee Satisfaction Surveys
Employee satisfaction surveys can give organizations a better picture of how employees feel about their benefits package, providing insight into how well they meet their workforce’s needs.
Benefits Utilization Rates
Another good indicator of how well benefits serve employees is how often they are used. A low benefits utilization rate may mean a benefits overhaul is needed; it could also indicate that organizations must better communicate their offering to their employee base.
Cost-Benefit Analysis
A cost-benefit analysis compares the costs of the benefits package to the advantages they yield in terms of turnover reductions or productivity increases. It is a way of assessing the return on investment provided by the benefits.
Analyzing Your Current Benefits
Benefits benchmarking begins with a thorough inventory of the current benefits package, identifying details ranging from the health insurance offering to flexible working arrangements.
These will then be benchmarked against similar organizations so the company can see where it stands and spot any gaps or areas where improvements can be made. This comprehension of what is working and what is falling short can be used to refine the benefits program.
Communicating Changes to Employees
Any changes made to benefits should be communicated clearly to employees, using multiple methods of communication and soliciting feedback on the changes.
Partner With Business Benefits Group Brokerage
Employee benefits benchmark reporting is a powerful tool for helping companies gain a competitive edge and reduce turnover. At Business Benefits Group, our expertise in employee benefits benchmarking enables us to provide customized solutions that help your organization meet its goals. Contact us today for a consultation.