The ‘right side’ of client retention
As the HR world evolves, integrating new technologies to engage employees across the generations, brokers are expected to be ahead of the curve. Cincinnati-based payroll processing and HR software business Paycor hosted an event recently to help brokers maximize retention and growth strategies by using proper communication and capitalizing on data. Dan Mayton, vice president of Northeast and Mid-Atlantic area sales at Paycor and one of the speakers, spoke to Employee Benefit Adviser afterward to offer tips for helping brokers better interact with their clients. This conversation has been edited for clarity.
EBA: How often should brokers reach out to their clients?
Mayton: The real question we should be asking is, “How much do I know about what my client needs?” The answer to that question will help to determine the level of communication required to maintain a quality relationship. At a minimum, a benefit broker should be communicating HR/benefit compliance updates to ensure their client is informed and ready for what’s ahead. What happened yesterday could change rapidly to what will happen tomorrow. How a benefit broker translates this type of compliance communication can help them to build value and ensure their client regards them as an actual adviser — above and beyond the silo of being a benefits expert only. Competition is fierce. If a benefit broker is not managing a consistent and recurring communication practice with their clientele, the client may start looking for someone who can.
EBA: As the workforce population changes, HR needs to adapt. What do you see happening with broker-client communication? What should brokers be doing?
Mayton: There is an old saying, “If you’re not growing, you’re dying.” The HR world is moving fast and it requires significant agility to keep up with the complexities of the employee population and regulatory compliance change. Unfortunately, business owners typically have limited internal resources to help their HR departments. The problem is not of question of where to find these resources, but recognizing the HR department’s need to be strategic. HR is no longer considered a cost center. If managed wisely, the HR department can be very profitable and help reduce costs, especially when you consider the value of employees, the cost of turnover and the benefit options available to reduce attrition.
HR has been put in the front seat and is now being held accountable to regularly communicate with their benefit brokers. The purpose is to help to identify the gaps in the benefit plan offerings, areas of improvement and overall opportunity to make an impactful change to the employee population.
The best way for brokers to prepare for this topic is to be ahead of the curve on all subject matter relating to their clients’ needs. The four most common topics that they can better understand are what I refer to as TECH: Technology, education, compliance and HR strategy. If benefit brokers can be the subject matter experts on these four areas of expertise as it relates to their client, they can be better equipped to communicate and support the HR departments of their clients.
EBA: What trends should brokers keep their eyes on?
Mayton: One of the biggest mistakes a benefit broker can make is underestimating the competition in their industry and assuming their clients are not at risk for attrition. In fact, we often see benefit brokers taking a retroactive stance as a result of client turnover before they realize a more strategic vision to their business is required.
In the last decade, the benefit broker and HCM industry have changed dramatically. In today’s world, these two industries are completely aligned and why we are seeing so many HCM vendors adding health and benefits to their offerings. Some of these HCM vendors are becoming more strategic as they begin to adapt to the marketplace in an effort to grow their margins. Recognition of this rapidly challenging environment will only help benefit brokers be aware and ready for what is to come.
Collecting and managing data is the path to controlling ownership. SaaS technology has revolutionized the marketplace and provided the ability for data to reign supreme. Access to client data provides the benefit broker, or competitor, the ability to manage the growth, decline and scalability of their book of business.
If you want to take a glimpse into the future and have a more proactive stance for a strategic business vision, consider who the HCM vendors are that own the market share of client data today and tomorrow and what their long-term competitive strategy is. Do not be nearsighted and assume you have no risk with the short-term “broker-friendly” sales pitch. In another 10 years, those benefit brokers who have prepared for this environment will be on the right side of client retention and growth.