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EBC 25TH ANNUAL 1997: COMMUNICATING BENEFITS REMAINS A CHALLENGE

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Communicating increasingly complex benefits messages to employees in today's downsized corporate world is an ever-more-demanding creative challenge to benefit managers.

Not only do employees need to select from a myriad of health plans, but they also must make retirement investment decisions and understand how much the cost of their benefits affects their companies' bottom lines.

The trend toward "total compensation," in which employee remuneration incorporates salaries and what employers pay for benefits, also is posing a significant communication challenge for benefit managers, many of whom must do more with less.

Fortunately, new interactive media, such as internal corporate intranets, the Internet and the World Wide Web, have given benefit managers some exciting new tools to meet these communication challenges.

But even with the proliferation of technology, print and face-to-face meetings still are important, most benefit communication experts believe.

The increasing complexity of benefit plans -- from flex to 401(k) -- at a time when companies are paring their non-profit-center staffs is making benefit communications a lot more challenging, according to Rita Grazda, former director of human resource communication for Bell Atlantic Corp. in Arlington, Va. She recently assumed a similar post at American Express in New York.

"You are constantly having to juggle between getting (employees) information in an appropriate way and not overburdening them with information that is going to bog them down and prevent them from focusing on customer service, which is where virtually every industry is going right now," said Ms. Grazda.

For example, the proliferation of health care carve-outs is making benefit plan selection more complicated and confusing for employees of The Walt Disney Co., according to Alison McQuay, manager of employee benefit communications for the Burbank, Calif.-based entertainment company.

Disney has different provider networks for health care, dental and prescription benefits, she explained.

While the additional choice is good for employees, "it's very confusing for people," she said.

Today there is a "pressing need to communicate complex issues in a comprehensive, succinct manner," observed Elizabeth Borzomati, benefits manager for Pfizer Inc. in New York.

"Employees need to be educated buyers of managed care" and other benefits, she said.

In some cases, benefit managers need to learn more, too, especially in investment education, suggests Trey Wood, principal and communications consultant for Buck Consultants Inc. in Atlanta.

"Employees are better informed on investment issues, and benefit managers are asked more questions about the financial benefits," he said.

Also posing a communication challenge to many benefit managers is the growing use of the term "total compensation," many benefit experts point out.

Transforming employees' perception of benefits from an entitlement to an integral part of their total compensation package is difficult, according to Tony Amato, director of compensation and benefits for The Hard Rock Cafe International Inc. in Orlando, Fla.

Employees need to understand not only what their benefits are but how much they are worth, agreed Arlene Westbrook, benefits manager for the Chicago Mercantile Exchange.

Lenny Sanicola, benefits manager for the Phoenix-based Doubletree Hotels Corp., said: "We need to get employees to look at the total compensation and understand the total picture of benefits as an entire picture. They truly don't understand how much the company is committing."

In many cases, the total compensation message is closely aligned with the company's business strategy, explained Leslie Dutton, communications consultant for Hewitt Associates L.L.C. in Toronto.

For example, if the business strategy is to encourage employees to be creative and to think on their feet, their benefit programs may reflect that by empowering employees to make benefit choices, she said.

Indeed, it's a challenge for employers to "get people on the same page, trying to connect employees to the business strategy," said Kevin McDermott, a principal at Towers Perrin in Dallas.

The biggest benefit communication challenge for Margaret Fuller, manager of the profit-sharing plan and trust at the Southland Corp. in Dallas, is "finding a way to make it something people want to listen to" and ways to get people to break into their busy schedules to watch, listen to or read the information you're trying to communicate.

"Everybody's so incredibly busy as people slim back," Ms. Fuller said.

To meet these and other communication challenges, employers "must present information in a way that is efficient and easy to use," suggests Ms. Grazda.

For example, some large multinationals already are looking to electronic media to help them get the word out.

"Trying to communicate is tough because we are much more global," said Triny Jauco Lee, manager of employee benefits for Lockheed Martin Missiles & Space in Sunnyvale, Calif. "We have more employees nationwide as well as overseas."

To ensure that benefits information gets out in a timely manner to hundreds of Lockheed Martin operating units around the world, "our company has added employee television shown in lobbies and hallways," she said.

Lockheed Martin also has an intranet Web site.

"But we have a long way to go. For instance, many of our employees travel, so trying to get info to them quickly and timely can be impossible. They can be gone during the whole time of open enrollment. We are looking for an electronic solution," she said.

"As employees become more familiar and comfortable (with interactive media), I think it's going to become a way of life," predicts Judy Hoffman, manager of benefits planning and communications for Ralston Purina Co. in St. Louis.

Marty DuRall, director of human resources for service lines and clinical support at St. Vincent Hospital and Health Services in Indianapolis, said: "The Internet is the telephone of the future. If you don't use that, you'll be behind the 8-ball."

In the future, the Internet and corporate intranet systems will affect employee benefits communications significantly, noted Fred Burns, vp of human resources for Capital One Services Inc. in Glen Allen, Va.

He said these media offer three distinct advantages: First, they make it easier for employees to access information. They also are more interactive but without adding bureaucracy. Finally, they allow for more information to be conveyed in a user-friendly way.

But as efficient as technology may be, Mr. Burns said he thinks "print will never be supplanted. Technology doesn't solve everything."

Indeed, while the electronic media will save paperwork, "people are comfortable with print," pointed out Chris Finn, senior vp and account director for Citigate Albert Frank, a New York-based advertising and public relations agency specializing in business-to-business communications and financial services.

While the Internet can make it much easier for employees to get up-to-date information, it's not for everyone, according to Mark Schumann, principal at Towers Perrin in Dallas.

For example, at the Doubletree hotel chain -- one of his clients -- "the maids and the cooks really don't have access to it," he said.

"You need to use a variety of media to get your point across. To select one is very narrow-sighted," said Cheryl Flynn, corporate vp of compensation and benefits for LSG/Lufthansa Service-SKY Chefs Inc. of Arlington, Texas.

Bill Zabit, president of Zabit & Associates Inc., a benefit communications company based in Sausalito, Calif., agrees.

To ensure that everyone gets the message, "the communication cannot be isolated to one program," he said.

New technology "is just one tool," for benefit communications, he said.

"It will play a more prominent role in the future but can never replace a face-to-face meeting as the best means of communication," he said.

The Chicago Mercantile Exchange started an annual benefits fair last year to make its benefit message more enticing to employees, according to Laura Freston, director of compensation and benefits.

During the fair, conducted during annual open enrollment, employees are invited to talk with benefit department staff members and benefit plan vendors.

To attract employees to the fair, the exchange holds a raffle.

"It's really kind of a festive atmosphere" that "creates a lot of excitement," described Ms. Freston. "We decorate the room a bit and try to have some fun."

Also contributing to this report were Associate Editors Robert Kazel, Rodd Zolkos and Deborah Shalowitz Cowans in Chicago, Roberto Ceniceros in Los Angeles, Michael Prince in New York and Editorial Assistant Amanda Milligan in Chicago.