Wednesday, October 1, 2025
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Impact of Technology on Employee Benefits Management

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The social contract through which organizations motivate and engage individuals to expend discretionary effort is through what we have now come to christen as Total Rewards. Organizations look to reciprocate the value that employees bring to the table through the elements of compensation, benefits and a host of other elements that have evolved into reality in the last few years. In exchange, employees (especially Millennials and Gen Z) have come to expect a higher degree of agency and valence. This has led to shifts in the sphere of Total Rewards and specifically benefits in terms of the approach and the design principles that have been prevalent.

To begin with, from the perspective of employees, I believe the following are the emergent trends where technology is playing a key role in transformation:

Personalization @ Scale: My Rewards, My Choice

The design of benefit programs in our part of the world has traditionally been governed by complicated tax laws and a strong linkage to grades and other surrogates of the organizational hierarchy. There is a shift in the mindset from “I will drive a bigger car and live in a bigger house as I grow in my career.” to “Let me choose what kind of car and house is appropriate for me.” This has led to trends of Flexible Pay and Flexible Benefits plans being deployed by organizations. Technology allows for employees to make prudent choices based on their personal situation within their Total Rewards baskets. Employees today can choose to forego leaves and in exchange for a higher car allowance or enroll in medical copay schemes. Robust data management enabled through technological solutions ensure compliance as well as employee visibility on the choices exercised by them.

Human-Centered Design: Making Rewards Accessible

The other key benefit from an employee’s perspective that technological solutions bring to the table is to simplify and standardize the process through which an employee can access and take advantage of a benefit. This is achieved by ensuring that every process is designed and deployed through appropriate technology with the end-user in mind. An employee today does not need to spend hours collating receipts and fill cumbersome claims forms and instead can access all this information and make claims, changes, and queries on the go. This is a significant advantage that emergent technologies like machine learning-enabled chatbots can provide.

The new technological landscape has some very distinctive advantages for organizations as well in the area of Benefits. The following I believe are some of the key trends:

Advanced Analytics: Proactive Benefits Management

One of the biggest benefits that organizations are able to garner from the ocean of metadata that is now available is to have a sharper understanding of the choice patterns and needs of employees. There is a substantial degree of insight that organizations can derive in the areas of preventive health management, work-life balance, recognition programs etcetera. This allows organizations to focus their resources and investments on things that matter and address the pertinent needs of their employees. There is a slew of initiatives like mobile-enabled counselling solutions, dietary and nutritional knowledge, etc. that companies are able to launch today with an enhanced understanding of employee needs. Organizations are also able to take feedback from employees on the go on new or prevalent initiatives and have a real-time understanding of what is working well and what is not. This presents an opportunity thereby for organizations to cull out benefit offerings that do not have encouraging feedback and channelize their resources elsewhere. In short, organizations can now truly start putting employees at the heart of everything they do in the space of benefits.

Enhanced Communication: From Compensation To Total Rewards

The emergence of Total Rewards Statements has provided organizations with an opportunity to reposition their communication to employees from monthly salaries, incentives, entitlements etcetera to truly total rewards offerings. An employee today is able to have on the go access to everything that the organization has on offer for her and is thereby able to make conscious choices basis her needs. It allows organizations to demonstrate external competitiveness not just on elements of Total Rewards which can be costed but also on fiscally intangible elements like flexible work hours, learning programs and development opportunities. This is a huge fillip to organizations in their journey of becoming employers of choice.

To conclude, the disruption that technology has brought in the sphere of Total Rewards has been quite transformational and is likely to be more disruptive in the future as the workforce gets younger and the definitions of valence and agency evolve.

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Souvik Mazumdar
Souvik Mazumdar
Souvik Mazumdar, Head of Total Rewards for Nestlé South Asia. He is a post-graduate from the Tata Institute of Social Sciences. Souvik has experience across different verticals of HR including roles in business partnering and organization design apart from total rewards. He likes to read in his free time and is keenly interested in learning about emergent trends in technology and analytics.