How artificial intelligence is being used to engage employees in their workplace savings

Every year we take billions of selfies; holiday photos; pictures of food and new purchases that we share on social media alongside updates and emojis that showcase what we’re doing and how we’re feeling.

All of this data can be positioned under key demographic profiles to allow companies and brands to analyse consumer preferences and identify how to talk to their audience/users about the things they want to talk about and using content that will resonate with them.

It is only by using AI and more specifically by leveraging ‘convolutional neural networks’, a type of advanced AI, that we are able to take these huge stores of data and pull meaningful insights from them. Neural networks can be used to analyse the visual content that we see in the imagery posted on social media and categorise them and identify user preferences and activities.

It is advances in AI, such as this, that are giving us greater insights into our workforce and allowing us to communicate with them in ways that drive action. So what other benefits are we seeing from the emergence of AI in the workplace and how is it being used to help the workforce?

1) Personalisation

The words ‘default’ or ‘core’ seem to be synonymous with many employee benefits. Default investment fund, default contribution rates, core benefit offering, all these words point towards an unengaged workforce who haven’t really made much of a decision.

So why are we happy to allow everyone to sit at the average or default level? In our experience, it is mainly due to the difficulty around personalisation for everyone. Step in AI. Using the aforementioned consumer preference knowledge, AI powered benefits systems can provide valuable insights to individuals recommending what other people who are in their circumstances, most commonly do and why. This leads to more personalised plans and a feeling of increased ownership by employees.

2) Performance

Following on from ‘personalisation’ is the trend of ‘performance’. When many of us are enrolled into a workplace pension scheme we are often given a choice of between three and five default funds. Usually these funds correspond with increased levels of risk.

The unengaged employee will tend to select the middle default option and then potentially spend the next 40 years in a fund which is not tailored to their circumstances and can mean a huge underperformance in their own fund. Investment strategy in workplace pensions is something which is ideally suited to AI and the new breed of robo-advisers we see entering the market.

Robo-advisers will analyse the multiple funds available to an employee and then build them a custom portfolio that not only suits their risk appetite but their retirement flexibility and any social or ethical preferences they may have. The number of employees sitting in a default strategy is often 90%+ at some of the employers we visit, and we believe this needs to be challenged now there are simple alternatives to personalise your funds further.

3) Engagement

Yes, I know, the most overused word in HR! Well this time is different… I promise! Let’s take two examples of engagement strategies. Let’s look at a typical email you receive from your HR team:

‘Hi Phil,

ABC Corp care about our employees and want to make sure you are managing your finances correctly. As such we have partnered with XYZ supplier to provide you with helpful information and tips on how to better manage your money. Click HERE to read more.

Kind regards‘

Sound familiar? Now if I’m an employee, by the time I’ve finished reading this email, another two unrelated emails have already popped into my inbox. I’m just too busy right now and I don’t fancy learning about finance as it’s complicated and I have so many other things to do!

Let’s look at the kind of message a company can send who are powered by AI and have the sort of big data insights that come with it:

‘Hi Phil

An important step in your journey to a comfortable retirement, is saving enough in to your pension each month. Did you know the more you pay in each month, ABC Corp will too? * (up to a certain amount)

We had a quick look over your pension and can see you are missing out on a £300 per month contribution from your employer. It’s essentially free money that could add up to an extra £15,000* when you retire!

Click here to save more today and our digital adviser will make all necessary changes then and there.

Thanks’

Quick, simple, and immediate gratification. This is the power of AI, to take data from multiple sources and turn it into meaningful messages which save us time and effort and can be immediately acted upon. Employees only engage in things which they perceive as valuable and the more effort required to engage in something, the more value it must be perceived to create.

AI has the capacity to revolutionise the way we engage with our workplace savings and the AI discussed in this article is all currently available and functioning in the market with impressive adoption rates. The modular approach many providers are taking means that employers can pick and choose the services which are provided to employees and associated costs are affordable. The challenge and necessity of getting employees to engage with their finances has never been more pressing but at the same time it has never been easier to turbocharge the efforts you are making with your current workplace savings programs with the addition of AI.

Phil Blows is director of Wealth Wizards.

This article was provided by Wealth Wizards.