4 Strategies for Managing Your Company’s Caregiving Costs

4 Strategies for Managing Your Company’s Caregiving Costs

Previously, we shared key insights from Harvard Business School’s (HBS) report, “The Caring Company,” which highlights the shocking turnover and productivity losses caregiving inflicts on U.S. companies.

To gain control over these losses, HBS recommends that employers shift their perspective on caregiving—viewing it as a talent management challenge rather than merely a potential benefit expense—and consider these four strategies:

1. Promulgate a culture of caregiving. Such a culture requires “management to demonstrate commitment through sustained, consistent action, reassuring employees that the organization welcomes openness about caregivers’ obligations and wishes to support employees confronting caregiving issues,” the report states. “That, in turn, will oblige the organization to develop a visible, systematic plan to help employees balance their personal and professional lives, a plan that covers both on-boarding and reentry into the workplace.”

2. Adopt a framework for balancing career and life paths. “Companies will need to design career paths that are more compatible with their employees’ life paths,” the report says. These career paths must take into account the predictable patterns of a caregiver’s life and responsibilities. Doing so will enable employers to provide specific communication, support and care benefits these people need at the exact times they need it.

3. Identify the hidden costs of caregiving. “Companies cannot assess the merits of investing in more substantial care solutions without understanding the hidden cost of caregiving,” the report observes. Uncovering these hidden costs requires a number of actions including conducting a care census (a profile of the company’s care demographics and needs); developing metrics for understanding the actual magnitude of caregiving costs incurred; and pinpointing the turnover, absenteeism and presenteeism caused by caregiving. All of these actions serve as the foundation for developing an explicit care strategy and making “prudent investments” that offset turnover and productivity losses.

4. Boost the productivity of caregiving employees. This involves adopting a test-and-learn approach to implementing caregiving benefits (i.e., experimenting with benefits before deploying them widely); giving special consideration to benefits focused on critical roles and/or hard-to-fill positions; providing on-boarding benefits to returning employees; and even collaborating with other employers and local governments to develop shared solutions.

7 Steps Toward a New Competitive Advantage

7 Steps Toward a New Competitive Advantage

Recognizing how daunting all of this might seem, the HBS authors also outline seven steps toward implementing these strategies:

Step 1: Conduct a care census to ascertain your organization’s care demographics. This critical first step, as outlined by the report, is essential if you aim to develop metrics for understanding the actual magnitude of your company’s caregiving-related costs. A care census entails: a) identifying the nature and scale of your workforce’s care needs; b) evaluating the relevance of your existing caregiving benefits; c) exploring the possibility of expanding these benefits; and d) capturing the returns associated with greater employee retention and productivity. Crucially, a care census also enables you to update your standard career paths to better reflect the life paths of today’s caregiving employees.

Step 2: Ensure that current employees are more aware of the benefits your company already offers. “Many employees appear to be unaware of the availability of care-related benefits,” according to HBS. You must communicate consistently about the caregiving benefits you already offer—and to reassure employees that your company “accepts the legitimacy of (their) care concerns.”

Step 3: Survey employees on their views of current benefits and identify the benefits they value most. HBS claims that many companies don’t know which benefits their employees desire or value most. This can create “a gross misalignment” between the benefits your employees actually need and those you offer. It also likely means the benefits you do provide are doing little to reduce turnover, burnout and lost productivity. Regular, ongoing employee surveys are vital to aligning benefit offerings to caregivers’ needs.

Step 4: Add additional benefits that address unmet needs. Your employee surveys also can help you identify any caregiver needs that are going unmet. When you decide to add a new benefit, consider rolling it out to a small test group before deploying it widely. This will help you determine which programs are likely to be well utilized and generate the highest returns on your investment.

Step 5: Monitor utilization rates. Caregiving benefits must be monitored and measured with the same diligence as other more costly benefits, such as health care and retirement benefits, states the HBS report. This is the only way to accurately assess these programs’ impact on retention, productivity and engagement.

Step 6: Assess the impact of benefits relative to expectations and in the eyes of employees. Only you and your employees can determine whether a program is worth your investment. This is why a regular care census, ongoing employee survey, and diligent monitoring are so important. They are the best methods for determining the impact of your programs.

Step 7: Customize care benefits by adding those that are meaningful to employees. The HBS report polled hundreds of employees on which caregiving benefits they currently use and which they anticipate using in the future. Caregiving provider referral services, on-site or near-site child care and elder care, and counseling services were all near the top of the lists. Again, surveying employees is paramount ensuring that your benefits remain relevant and deliver a steady ROI.

Follow these seven steps and you’ll not only create a more care-friendly culture but, as HBS notes, you will also “build a new source of competitive advantage” by attracting and retaining key talent.

If you’d like to learn more about caregiving-related benefits or other programs designed to help you employees better integrate their work and personal responsibilities, contact us here or call us at (833) 282-3366.