A great or unique company culture appears to be emerging as more of a lever to attract and retain millennial talent than traditional employee benefits. The question is will producers take this trend seriously in consultations with their clients?
Employers that don’t heed the call about the growing importance of a caring workplace culture will lose the talent war, says Andrew McNeil, a principal at Arrow Benefits Group (ABG) who is a millennial.
“Millennials want to be emotionally and physically connected to their employer and believe in their mission, values and purpose,” he says.
An informal ABG survey found 78% of millennials prefer to work for a company that offers less from a monetary and benefits standpoint but has a reputation for having a great company culture. Deloitte’s latest millennial survey, which found loyalty is in short supply among younger workers who feel their employer puts profit ahead of their own people, also supports this hypothesis.
A sense of purpose and vision
Despite more attention being paid to workplace culture, McNeil believes older brokers and advisers are reluctant to embrace this thinking — recalling the glazed look he receives from some of them when the topic arises.
While many business owners equate a good company culture to providing Google-style freebies, McNeil says there’s much more to it. For example, millennials also want to feel good about where they work and have a sense of purpose and vision about what they do. Trust and respect are a huge part of that equation, as well as the desire to feel appreciated, valued and empowered.
He has noticed that while many managers and business owners might be nice at home, “something happens to them once they walk through that office door. They become difficult to work for or with and that certainly does not help drive culture in a positive way.”
Also see: “9 rising trends in voluntary benefits.”
What’s significant about this generational preference is that millennials recently surpassed baby boomers, according to the U.S. Census Bureau, which estimates the number of millennial Americans age 18 to 34 in 2015 at 75.4 million vs. 74.9 million boomers age 51 to 69.
McNeil is impressed with the culture at Zappos, noting how one employee of the online seller of shoes and clothing whose headquarters he toured wished more companies realized the importance of workplace culture. “I’ve had other jobs, all of them with benefits programs, but have never had a culture like this,” the employee noted.
There are many other factors not tied to age — apart from benefits and compensation — that influence people when they choose one place to work over another, according to Karen Alary, managing partner of ABG’s HR division The Personnel Perspective who is a Gen-Xer. They range from basic needs (a paycheck) to convenience (a specific location to ease someone’s commute).
“I think there are always going to be people out there, no matter what generation they are, that aren’t necessarily going to be attracted to a particular culture,” she says.
Good for business
The fact is that helping employers develop the right culture can be good for business from a producer’s standpoint. “Being able to consult on culture is a huge value-add to companies that are interested in trying to find ways to retain and motivate their employees,” Alary notes.
This new thinking is so pervasive that it has even spilled across the pond. One such example is the U.K.-based Swagger & Swoon, which built a purpose-driven culture that fits and trains young new recruits around a set of core values that promote being different, curious or bold.
But it has been a long and arduous journey. Nearly seven years earlier, there was no real passion, desire or feeling of contributing to something greater at the online retailer of upscale fashion, grooming and gifts for discerning men, reports Gary Baker, the company’s founder and managing director. The realization was enough for him to promote inspiring values and Churchillian mission statements, “but all I got was blank faces,” he admits.
His starting point en route to a more enjoyable work environment was finding the right group of employees who were eager to immerse themselves in the culture he envisioned, which was irreverent, quirky and just plain different. Aside from having clear goals, visions, mission statements and core values, he sought the right work attitude. “The key I found is to tie your values into your overall mission; otherwise it just doesn't make sense,” Baker explains.
Also see: “Top 10 large-group vision carriers.”
The customer-service mission at Swagger & Swoon was a tall order: making shopping for men a truly pleasurable experience. In order to achieve that objective, he says an inspiring culture with the right core values and a sense of employee unity had to be in place along with an enjoyable work environment.
“Most mission statements and core values that you see thrown around are just sentences put up by someone because they should have them,” according to Baker. “There’s no internal, emotional connection to them, so no one really lives by them.”
After 11 years as an adviser, McNeil believes employee benefits program will become less of a recruitment and retention tool in the future. And while he’s not arguing against offering insurance coverage at work, he advocates spending more time with employer clients on developing the right culture as talent management becomes more vital to business success.
Baker, of Swagger & Swoon, believes benefit brokers and advisers are perfectly positioned to help HR departments develop their culture. “I do think employee benefit schemes add considerable value to employees’ feelings toward the company, but add in a culture they can believe in and you’ve got something really special,” he says.
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