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Vendor vs. Partnering in Benefits Outsourcing
How's your outsourcing going today?
Ok, so you outsourced and now you wonder what to do next.  Or maybe you been outsourced for several years and don't feel good about your relationship with your vendor.  Things just aren't going as well as you wanted.  First, let's examine things that seem to go wrong in an outsourced environment.  Then we will look at what a true partnering relationship could do to help improve the situation and finally, how do we develop a partnering environment.  Since this is one person's opinion, I would appreciate any comments or other ideas on our message board (below).  There are definitely many approaches to this issue.
First, let's find out what's happening today.  Would you please take a few minutes and complete the little survey to the right.  How are you doing?

Evaluate your benefits outsourcing
Better than expected
In line with expectations
Having some problems
In serious trouble.

What can go wrong in benefits outsourcing?  Not in priority order.  You have others?
e-hr message board.  Leave your opinions are asked others how they feel.
1.  Vendor won't renew the contract.
2.  You call and they take longer and longer to respond.
3.  You are told that because of the higher than expected volumes of calls or other transactions, you must pay more.
4.  You are charged to visit them and tell them you are not happy.
5.  New hires don't get information on a timely basis and miss out on medical coverage.
6.  Communications get totally out of date and are not monitored.
7.  The number of errors increases daily.
8.  Follow up takes longer and longer.
9.  Employees begin complaining to HR and anyone that will listen.
10.Vendor cannot meet your changing business needs.  You start missing deadlines for corporate changes.
11.High level of turnover at the vendor and poor crossover training.  They don't really know your benefit plans anymore.
12.You try to audit, but are always delayed for various reasons.
13.Reports are late and generally inaccurate.
14.They turn off your 1-800-benefits number!
15.You get told by your manager that because you couldn't manage the vendor, your outsourced to the unemployment office!

Let's first be honest with each other.  Do you remember any problems when you did your benefits administration in-house?  Maybe the problems were different, but there were normally problems.  One difference is that in a successful benefits outsourced environment, participants actually know more about their benefit plans.  That in itself is a great accomplishment, but it also brings more complaints and a demand for even more services.  It's kind of like waking up a sleeping benefits giant.  So, before you get too concerned, try to think back to the past and really assess yesterday vs. today. 

A true partnering relationship is rather simple.  It means that you have a partner you can trust and works with you to achieve your business goals.  At the same time, you work with the partner to help them achieve their business goals.  You mean, work with the vendor to help them?

Yes, that's right.  It's got to be a win-win situation for both of you.  If they are not successful by getting more customers, improved customer satisifaction and eventual financial success, they really can't afford the systems and investment in people that are needed to really be successful.
1.  Periodic meetings to discuss your company's business plans.  Also, the vendor needs to be open with you on their business plans.  How do the two co-exist?  If there are problems in priorities, systems, etc.., talk them out.  Don't wait until it's too late.
2.  Develop a clear project list that is reviewed MONTHLY.  Make sure everyone knows the priorities, the deadline dates, and the resources needed to make it happen.
3. Develop an in-house complaint system that supplements the vendors'.  I know, why have an in-house system?  It's called insurance to yourself and HR.  Some employees will never tell a vendor they are unhappy.  They'll make sure their management knows it and then outsourcing starts downhill.  Build yourself an in-house complaint system.   It shouldn't conflict with the vendors' and in fact, ties into their normal system.  Over a period of time, it might not be needed.  But, why risk your job to find out.
4.  Celebrate successes together.   Get to know the people that service your account.  Make sure they know your people.
5.  There are a lot of other items which I'll develop later.  If you have other ideas, please leave them on our message board.
Important legal disclosure:  The merchants and manufacturers linked to this site are fully responsible and liable for their products and services. and does not recommend the purchase of any products and services.  Any issues with the merchants and manufacturers should be directed to them.
Improving Your Partnership
This page was last updated on: February 2, 2010

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