Good intentions, unclear strategies
If emotions sit at the heart of benefits, strategy is where those feelings translate into action. But while many SMEs recognise that their benefits aren’t hitting the mark, they struggle to deliver meaningful change. This is not because they don’t care. Rather, it reflects the absence of clear ideas about how to move forward.
The challenge of financial wellbeing
When it comes to shaping leaders’ benefits strategies, few areas carry as much weight as financial security. Against a backdrop of economic uncertainty, money-related issues are rising rapidly up the agenda. Over four in ten SME leaders (41%) say the cost-of-living crisis is one of their strongest external influences, while three in ten (30%) point to financial wellbeing as a key source of pressure. Almost the same proportion (31%) place it among the most important benefits to employees.
Financial wellbeing support can encompass a range of measures, from pensions schemes, retirement planning, and savings support to life insurance and income protection plans. But here, personal influence looms large: according to our findings, between 75–84% of leaders say their own or a colleague’s experiences shaped these choices. The result is that some of the most critical benefits – those designed to safeguard employees’ long-term financial security – may be shaped less by strategic planning than by personal stories and lived experience.
Money matters
External challenges influencing benefits decision-making (top 3)
Poor financial wellbeing can lead to anxiety, depression, and burnout. But the ripple effects can also impact morale, productivity and attendance at work. Thankfully, there are several ways in which SMEs can support their employees – including wellbeing workshops, one-to-one consultations, and dedicated financial coaching. Personalising this support can help to boost engagement, foster talent attraction and retention, and drive business growth.
Mark Hathaway, Pensions & Workplace Savings Team Leader
Benefits strategies lack consistency
Leaders are not entirely in the dark about their biases: an overwhelming 86% of respondents admit that their benefits strategy needs at least some improvement. This highlights a clear recognition that current offerings may not fully meet the expectations of today’s workforce and future talent. Yet, when it comes to updating their benefits strategies, SMEs are coming up against a series of barriers – in the shape of conflicting advice, lack of time, and fear of getting it wrong.
The most significant barriers facing leaders are rooted in uncertainty rather than apathy. But as our research shows, this doesn’t prevent decisions from being taken – nearly 7 in 10 respondents to our survey have reviewed their benefits in the past year. This indicates that the problem isn’t one of activity, but of the quality of leaders’ decision making. Reviews risk being reactive check-ins shaped by immediate pressures, rather than long-term, strategic reassessments of what employees truly need.
Feeling uncertain
Barriers leaders face when updating their benefits strategies (top 3)
Conflicting advice
Lack of time
Fear of getting it wrong
Lack of expertise
Not knowing what employees want
Not a current business priority
Feeling like it won’t make a difference
Much of the issue lies in where guidance comes from – or doesn’t. Although 45% of SME leaders build their strategies based on employee feedback, two-thirds of those still feel unequipped to deliver the best possible benefits package. Meanwhile, only 12% of leaders say they’re guided by a broker or external adviser. With most decisions being made internally, it’s no surprise that strategies can lack consistency.
Ultimately, good intentions are not in short supply. But without the right support, leaders will continue to lack clarity, confidence, and their strategies are likely to stall. Reviews may be happening, but they lack impact. For SMEs to move forward, leaders need more than willpower – they need tools, advice, and communication channels that give their strategies real shape and staying power.
Going it alone
How leaders develop their benefits strategies
Based on employee feedback
Based on leadership preferences
Guided by a broker/external adviser
Built historically and rarely reviewed
Copied from competitor
None of the above