O2 and Bluefin develop program to engage and educate employees
Article Type: Rewards From: Strategic HR Review, Volume 11, Issue 6
Short case studies and research papers that demonstrate best practice in rewards
Telefonica, known as O2 in the UK, wanted to engage and educate its people about benefits and pensions and last year asked Bluefin Corporate Consulting to help. O2 is one of the largest and most recognized brands in the UK, with over 11,000 employees working mostly in contact centers or retail stores. O2 recognizes that its people are its biggest asset and is keen to ensure that staff enjoy their work and feel supported by their employer.
Early in 2011, O2 partnered with Bluefin Corporate Consulting to develop a program to help engage and educate employees about their benefits and pensions. O2 realized that things are difficult in the current economic climate and so it’s more important than ever that its people are aware of the benefits and pension provision available to them. It’s vital that they are able to understand what’s available in the context of their financial needs.
The challenge of communicating complex messages
O2 also recognized that such complex subjects need a tailored approach and so asked Bluefin to develop a number of targeted campaigns. The first of these was around changes to the firm’s defined benefit (DB) scheme.
O2 had already completed an actuarial review of its DB pension scheme and developed an offer where employees could choose to pay 4 percent extra of pay to stay in the scheme or opt out. If they chose to leave the scheme, they were offered a 21 percent increase in salary for five years that could be taken as pay or paid into a pension, and the employee’s DB pension was fully protected up to the date they opted out.
The company needed to communicate this offer to employees so they could decide whether or not it was the right choice for them. However, Bluefin advised that introducing an independent financial adviser (IFA) to give formal advice too early in the process would be daunting for people. Instead, it worked with O2 to put together a variety of activities that would engage employees and help them understand the choice on offer in the context of their own personal circumstances.
A multi-faceted campaign with a personal touch
Bluefin developed a multi-faceted campaign with a number of steps. The first was a letter from O2 CEO Ronan Dunne and an information pack describing the offer. Employees could book onto a group presentation given by O2 management and Bluefin consultants to explain the rationale behind the changes.
The next step was for employees to use an online modeler tool, available through a secure log-in. This allowed them to input personal details and see what the financial impact would be if they chose to leave the DB scheme, based on their individual circumstances.
Employees who wanted to find out more could then book a place on a clinic session run by Bluefin experts. At these sessions employees’ modeler outputs were analyzed and explained in more detail, and there was an opportunity to ask further questions in confidence. Finally, people who were interested in the offer could see an IFA, provided free of charge by O2, to receive formal financial advice. Staff had to have taken financial advice before they could accept the offer.
Attention to detail reaps rewards
With any kind of pension offer like this, it will only make sense for some staff to accept it. The process developed, including the modeler tool and the clinics, enabled people to understand the consequences of the offer for them personally and ask specific questions relating to their own financial situation. This meant that only those staff who would benefit from financial advice from an IFA made an appointment, saving their time.
It was important that Bluefin understood the culture of O2 before embarking on the campaign and with this in mind it ran “cultural dips” for its consultants. They spent time with O2 so they understood its culture, how it communicates with its people and the history of its business. This was important as it fed into the planning and running of various activities, but also to help Bluefin remain alert to issues as they arose and be flexible if situations changed.
Out of the 2,100 people within the DB scheme to whom the offer was relevant,over 1,100 used the modeler tool. Bluefin would normally expect around three in ten employees to use a modeler tool, so to get a response rate of over 50 percent is fantastic. In addition, 500 people attended a clinic to get further details.
Plans for financial education campaign
O2 and Bluefin are now developing a second campaign of financial education for employees, ahead of the automatic enrolment legislation that is due to come in to force for O2 in March 2013. This campaign is particularly targeted at those who are currently not saving into a pension. However, the campaign is focused on much more than just pensions.
Automatic enrolment is a big issue for O2 and it is considering the best process for implementation. As part of this, it wants to hear from those people who traditionally stay away from pensions as well as those who are part of its DB and DC schemes.
In order to engage those employees who are not currently part of its pension schemes O2 is going to look at its employees’ finances holistically, not just pensions. Many people could benefit from help with their finances; they don’t want to just receive complicated information about changes to pension legislation or tax relief opportunities. Working with Bluefin, O2 will be able to offer support for them on a range of financial decisions, as well as working with employee representative bodies to help shape its future offering.
Financial support a retention tool
For this second campaign, Bluefin has produced a co-branded microsite on behalf of O2 entitled “Your Money, Your Pension” to provide general financial education for employees. This includes information on topics from budgeting, saving and managing debt to using loyalty schemes, discount vouchers and energy efficiency. In addition, Bluefin consultants will again run clinics for people who would like further information and support on specific issues.
The second campaign is designed to help all O2 employees become more engaged in their finances. O2 is delighted by the success of the first campaign and excited about the second campaign. Bluefin has demonstrated what can be achieved with targeted, well-planned activity, and it believes that this will have a huge impact. The aim at O2 is to create an employee experience that appeals to people’s emotional and rational commitment. It hopes that people will not only feel proud to work at O2 – and part of something really special – but they’ll also be confident it makes financial and professional sense to stay with O2.
Adrian Chapman, James Kirkland
About the authors
Adrian Chapman is Consultant at Bluefin Corporate Consulting. He has worked in the pensions industry for over 20 years developing innovative solutions for clients and contributing to industry working groups. Adrian Chapman can be contacted at: adrian.chapman@bluefingroup.co.uk
James Kirkland is Head of Pensions, Benefits and Recognition at O2. He is responsible for benefits, pensions and recognition across the O2 countries,which cover 30,000 of the 250,000 employees worldwide. James Kirkland can be contacted at: james.kirkland@o2.com
