The benefit administration tool category is anticipated to grow at a CAGR of 8% from 2023 to 2030. North America region dominates this category. Rising manpower in the organization has changed the way organizations handle the benefits of their employees. A hybrid work environment has improved mental and emotional workforce health. However, the major concern among the employees that have emerged following COVID-19 is an integrated employee leave strategy. This has further led to the adoption of technology to enhance efficiency and adapt to the requirements of a remote and hybrid workforce. According to Guardian 2023 report, the pandemic resulted in the investment of around USD 12 billion into software and platforms related to HR technology in 2021.
Artificial intelligence has the potential to optimize benefits administration, lower expenses, boost accuracy, and improve adherence. By automating tasks, offering customized suggestions, enhancing communication, and generating valuable insights, AI can significantly enhance the efficiency and effectiveness of employee benefits management. However, it is crucial to maintain a balance between AI-driven automation and preserving a human element to ensure that employees can still receive personalized support and assistance as required.
Companies are shifting their focus towards a secure, reliable, and flexible environment using cloud-based platforms. By utilizing these platforms, organizations can effortlessly centralize their data and enhance operations and workflow across multiple branches and offices. Such a transition will have a beneficial effect on workforce management, product development, and business integration. Nevertheless, it is crucial to assess the company's readiness to adopt this technology and its potential to bring added value to the business before making the switch to a cloud based HCM system.
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The introduction of mobile apps has revolutionized the method by which employees obtain and oversee their benefits. These apps allow employees to access their benefits information from their smartphones at any time and from any location. Such information encompasses details regarding health insurance, retirement plans, and various other benefits. Additionally, mobile apps facilitate benefits enrollment, claims submission, and access to wellness programs. From an employer's perspective, mobile apps effectively communicate benefit updates, changes, and vital information to employees. Furthermore, they can serve as a tool for sending reminders and alerts regarding upcoming enrollment deadlines or wellness events.
The suppliers of the category refer to the software developers or providers of the technology and infrastructure required for the tool. The bargaining power of suppliers can be moderate to high, depending on the number of suppliers available and their differentiation. If there are only a few dominant suppliers, they may have more bargaining power to dictate pricing and terms. However, if there are numerous suppliers offering similar solutions, their power may be diminished.
Administrating employee benefits can be a complex and time-consuming task. Outsourcing the administrative service can reduce the burden of paperwork and going through the legal steps of administering the benefit plans. Companies usually outsource such services as it provides them with various benefits such as lower cost, more options for employee benefits, professional expertise, and protection to the organization against unnecessary risk. Whenever outsourcing administrative benefit services, the organization must be ready with the benefits design and administrative needs otherwise it may cost extra. Maintaining long-term relationships with the service provider is also considered to be beneficial as it helps their customers such as companies in various sectors including IT, healthcare, and others to know the service provider better and save on searching and evaluating new service providers. The use of such practices in sourcing the services can ensure customer satisfaction, and quality services over the long run.
Administrative service providers are continuously looking to launch new benefits or enter partnerships with companies to offer their services and sustain themselves in the market. For instance, in May 2021, Businessolver a SaaS-based benefits administration technology provider announced a partnership with Amino a healthcare guidance platform, to launch “MyChoice Find a Provider” a navigation tool to find and book cost-effective, high-quality medical care.
Benefit Administration Tool Procurement Intelligence Report Scope
• Benefit Administration Tool Category Growth Rate: CAGR of 8% from 2023 to 2030
• Pricing growth Outlook: 5 - 7% (annual)
• Pricing Models: Full Service Outsource Pricing, Price for services offered, Competition based pricing
• Supplier Selection Scope: End-to-end service, cost and pricing, compliance, security and data protection, service reliability and scalability
• Supplier selection criteria: Software interface, traffic handling capacity, software agility, services offered, end-to-end services, track record and reputation, technical support, upgrade timeline, and options
• Report Coverage: Revenue forecast, supplier ranking, supplier matrix, emerging technology, pricing models, cost structure, competitive landscape, growth factors, trends, engagement, and operating model
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Key companies profiled
• ADP Inc.
• Bamboo HR LLC
• bswift LLC
• Centurion Management Systems Limited d.b.a Breathe
• GoCo.io, Inc.
• Namely, Inc.
• Paycom Payroll LLC
• Paycor, Inc.
• Rippling People Center Inc.
• WEX Inc.
• Workday, Inc.