How will the benefits administration landscape evolve in 2019?

An increasing number of employers are taking HR administration online, and with more than $1 billion invested in tech solutions last year, this trend doesn’t seem to be slowing down.

This has implications for brokers, and anyone else who works at the intersection of benefits and HR. If your agency isn’t providing a solution to online benefits enrollment and other HR needs, you are likely continually evaluating options.

To be an educated buyer of a benefits and HR solution, it’s worth becoming familiar with an ongoing shift in this corner of the tech industry, and how it’s shaping the product roadmap of platform vendors.

There are a variety of software options for brokers and employers seeking to bring benefits and HR administration online — BambooHR, Zenefits, Employee Navigator, EaseCentral, BerniePortal, and carrier-provided benefit systems.

Historically, a key differentiator among these systems has been their go-to-market approach. The go-to-market spectrum ranges from being 100 percent broker-focused on one end to 100 percent employer-focused on the other.

While many platforms used to take extreme positions on either side of that spectrum, the various players are now recognizing that when it comes to serving the needs of small and mid-sized employers and their brokers, it is unwise to separate the two parties completely. It is difficult to serve the needs of one side of the spectrum without also addressing the needs of the other. All of the industry’s current players are experiencing this, and everyone is trying to strike the right balance.

As a result, systems that historically had a purely employer-focused go-to-market strategy, like BambooHR and Zenefits, have realized they need to work with brokers and serve the brokers’ needs as well. Conversely, systems that have traditionally had a primarily broker-focused go-to-market strategy are balancing across to the employer side of the spectrum.

Why should brokers or employers care about this development? Each of these software vendors is approaching this shift in a different way and working toward a different point on the employer-broker spectrum.

As software buyers look at their options to bring HR online, finding a partner that lines up with your needs on that spectrum will likely produce the best long-term outcomes. A platform that ignores the employer completely is unlikely to be embraced by your clients, causing implementation and ongoing service problems for you. A platform that ignores the broker completely is going to have high distribution costs, and will struggle to meet employers’ needs when it comes to benefits administration.

Ultimately, being familiar with this dynamic is becoming increasingly important to brokers who are yet to adopt a platform, or who have adopted one but continue to evaluate as the market continues to develop.

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Alex Tolbert is the author of “Online Benefits Technology: The Strategic Broker’s Guide” and leads BerniePortal, an all-in-one HR platform built for brokers by brokers. Before he started the BerniePortal, he worked primarily as a group health insurance broker.