Judges for The Principal® Financial Group's 2014 10 Best Companies for Employee Financial Security competition faced no easy task. On one hand, they had to evaluate how effectively applicants are building an organizational culture that helps employees take control of their financial health and wellness over the long term.
Judge Kevin Lynch, leadership executive-in-residence at Benedictine University's Center for Values-Driven Leadership, "struggled" evaluating candidates whose applications did not reflect a strong culture of helping to prepare employees for the future with benefits such as company-paid health wellness and financial wellness programs, one-on-one financial guidance, and significant training and personal growth opportunities.
On the other hand, the judges had to determine what current benefits really make an organization a Principal 10 Best company right now. As Judge Dallas Salisbury, president and CEO of EBRI (Employee Benefits Research Institute), put it, "Those companies that 'walk the walk' -- and the expense -- of financial security with employee benefits, even though their 'talk' may be lacking, deserve special consideration."
Clearly, the organizations selected as a 2014 Principal 10 Best Company by the judging panel (which also included Lisa G. Kottler, senior vice president, retirement services for NFP Insurance Services, Inc.; Christine Comaford, a leadership and culture coach; and Jason Martinez, director of operations at The Starr Conspiracy, a 2013 Principal 10 Best Company honoree) are attuned to the same issues. How they deal with them offers some important lessons.
Access, diversity, flexibility, and commitment
Removing barriers, promoting employee financial security, offering a diverse set of benefits, developing a culture of giving and purposeful living, maximizing flexibility, and vesting employees in the company's success are strategies that stand out among Principal 10 Best Companies.
"Removing barriers for our employees is key, so we provide education and resources to encourage them to take control and better plan for retirement. We also try to eliminate barriers to participation, ensuring that signing up, changing deferral options, etc., are easy and convenient," says Steve Bangert, chair and CEO of Denver, Colorado-based financial services provider CoBiz Financial. Employee financial security is very important to CoBiz, and dollar-for-dollar 401(k) plan matching contributions up to 6 percent drive a high level of participation in the plan.
Diversity of benefits is a distinguishing characteristic of Quick Left, Inc.'s strategy. The Boulder, Colorado-based software developer mixes benefits that help employees plan for their long-term futures with "some fun things they can take advantage of right now," says Ingrid Alongi, co-founder and CEO-Consulting. The firm offers employees tech and health and wellness stipends that "give them an excuse to buy themselves something fun they might otherwise not purchase," she reports. "That said, it's also important to look at the overall makeup of the company: Are people in the phase of their lives where they are in their first job, buying their first home, having children? Offering benefits that serve the diversity of employees is important."
Concern for employees provides a return
Companies that make the Principal 10 Best Company list all boast a demonstrable level of concern for their employees' well-being, but they also view that approach as something that returns significant benefits to their organizations. Keller Williams Realty, Inc., a real estate franchise company headquartered in Austin, Texas, sees its mission as "building careers worth having, businesses worth owning, and lives worth living," says co-founder and chair of the board Gary Keller. With participation in its 401(k) plan approaching 100 percent, a generous matching contribution program, and a defined benefit pension plan, Keller Williams provides the kind of employee financial security that rated kudos from Salisbury. "Employee engagement generates powerful returns for our company, keeping projects on track so we can deliver industry-leading innovation that gives our agents a competitive edge," notes Mary Tennant, president.
Flexibility that allows employees to custom-design individual benefits packages is another quality characterizing many of the 2014 Principal 10 Best Company honorees. Stellar Solutions, Inc. (Palo Alto, Calif.) has created a unique IBA (individual benefits account) approach that allows employees to use their benefit dollars in ways that best balance their current needs and their financial future. Founder and CEO Celeste V. Ford stresses that while the program is designed to give employees the widest range of options, it also provides extensive education and guidance tools to help them make the best choices.
ESOPs are strong motivators
When it comes to vesting employees in a company's success, perhaps no strategy is more effective than making them owners, which is what three of this year's honorees -- Boulder, Colorado, software firm Quick Left; Gibson, an insurance broker and risk management services firm based in South Bend, Indiana; and Haviland Enterprises, Inc., a Grand Rapids, Michigan-based manufacturer and distributor of chemicals and plastics -- do through their employee stock ownership plans (ESOPs).
At Haviland Enterprises, the ESOP is not only an important employee benefit, it's another manifestation of a company culture that CEO Bernie Haviland says is capsulized by the phrase "do the right thing." That culture has saved Haviland a tremendous amount in employee recruitment costs because virtually all new workers come through referrals from existing employees.
Profit-sharing bonus plans provide some of the same advantages ESOPs generate, and it's noteworthy that all this year's honorees offer them. San Francisco-based Ophthalmic Mutual Insurance Company (OMIC) uses profit sharing as part of its strategy for exceeding employee expectations "because they really are our most important asset," says CEO Timothy Padovese. OMIC is rewarded with one of the lowest employee turnover rates in its industry and a resulting 97 percent customer retention.
Helping to level the playing field
Paige Reh, human resources director at Strategic Communications, an information technology firm in Louisville, Kentucky, points out that smaller firms can use a creative approach to benefits to help level the playing field against larger competitors, and it doesn't have to cost a lot. Her company introduced new benefits focused on financial wellness and education during the past year, at little or no cost, by partnering with local banking organizations.
When all is said and done, the objectives of helping employees take control of their financial and health and wellness futures and providing them with the benefits they need now do not have to be in conflict. "I believe that one feeds into the other," says Pam Sartell, president of The Sartell Group, Inc., an information technology firm in Minneapolis, Minnesota. Chris Novak, CEO of the National Pork Board (Clive, Iowa) agrees and says that kind of comprehensive approach to benefits pays off tenfold in exceptional employee service. "We try to balance our compensation and benefits package in such a way that our employees don't have to always be wondering if we value them; we want them to know it," he says.
2014 Principal 10 Best Companies for Employee Financial Security
South Bend, IN
|Haviland Enterprises, Inc.|
Grand Rapids, MI
|Keller Williams Realty, Inc.|
|National Pork Board|
|Ophthalmic Mutual Insurance Company|
San Francisco, CA
|Quick Left, Inc.|
|Stellar Solutions, Inc.|
Palo Alto, CA
|The Sartell Group, Inc.|
4 Best Practices from the Principal 10 Best Companie"‹s
To learn more about how you can prepare your employees -- and yourself -- for retirement, visit the Principal Financial Group at www.principal.com/inc.