What is Target's approach to benefits and how do you leverage your people philosophy?

Leslie Pilliod: For us, it really starts with alignment with Target's company purpose, which is to help all families discover the joy of everyday life. Although that was designed with the guest in mind, and those who shop in our stores, those who shop online, it was very easy for us to hook to that in the benefit space, to help all families discover the joy of everyday life is absolutely what we're trying to do. We're trying to do it through the team members and reaching out to that employee, but knowing that the impact that we can have is actually about their household. 

The second piece for us was to take a look at Target's culture. Target's culture is to care, grow, and win together. It was very easy for us to say, okay, care, that's what we're doing. We are focused on breaking down barriers to access, equity, and affordability, and we use that as a guiding principle, as we make decisions for who we're going to partner with, and what are we going to offer to our team member population.

The [third] piece for us was having flexibility in our wellbeing strategy, and that's really a nod to the changing workforce. For us, it was really about understanding our team member population and identifying the areas where we were going to lean in. There [are] portions of the benefits portfolio that are a ticket to entry. [But] then spending time to say, based on our company culture, based on our team member insights, where are we going to lean in and go above and beyond? And we think that that's our competitive differentiator.

And then the last piece is a newer area of focus for us. And it's what we're calling “modernize our engagement.” Modernizing engagement is how are we going to get it out the door. And spending time to flex into that space to figure out what is the right delivery model for our team members with the goal of helping them understand our portfolio, appreciate and value the portfolio, and then use the portfolio. And that's where we're spending, quite frankly, the most of our energy lately. 

Lorna Borenstein: The shopping experience at Target is a felt experience, right? It elicits an emotive response from your customers, that even though other retailers might have the same products, it doesn't feel the same at another retailer's and I think that's the approach that you take with your team members as well that it needs to feel differently, which is why these are the pillars that you're talking about and in differentiating and that's the one that I wanted to just click in a little bit on choosing where you're going to lead and choosing what matters. When we talk about some of your distribution center employees and how it really mattered to you that you were engaging, for example, some of your Black male employees in some of your distribution centers were not as engaged and you were not seeing the engagement that you wanted to. 

Talk a little [about] how you said to [the Grokker] team that this is something we care deeply about. How can you help us [engage our employees]?

LP: I think for that example, in particular, we were spending time really digging into our data to say, okay, we rolled out Grokker company-wide, and 400,000 team members have access to it. Let's get through the learning curve of rolling out a new offering and see where we sit from an engagement perspective. And then we started digging into the data to say, where are we just not seeing the engagement that we expected, or where are we seeing portions of the population not engage the same way as their counterparts? We have a very strong commitment and a longstanding commitment to DE&I at Target. [We] set very specific goals. Through that work, we started through our DE& I function, an organization called R.E.A.C.H., which stands for Racial Equity Action and Change. And part of R.E.A.C.H. was sitting down with other areas, specifically in HR, to say, what's the work that you're doing that could help bring these R.E.A.C.H. initiatives to life? For my team at Benefits, The first thing they identified was we had to look at our data in a new way to see how our ethnically diverse team members might be engaging in a different way than their white peers. And Grokker was one of the areas that we looked at and it stood out for us, and we had a gap in engagement specific to our supply chain, diverse team members. 

Some other things that came out of that work were we started to take a look at how we might enhance our healthcare plan to better meet the cultural needs of our teams directly out of that work. We added a doula reimbursement. We added acupuncture care to our portfolio. These are things and additions that we made that we would not have done if we hadn't started looking deeper into our data. 

LB: The conversation [that was] really spurred where we have the ability to analyze all of the Target data right through the eligibility files by race, diverse groups, as well as age, job codes and be able to break it down and look at engagement measures in those ways and compare, have we moved the needle?

By aligning the interests and having that conversation, it made a big difference. We segmented the communications very differently for the different subpopulations. And then that saw a massive jump in engagement and actually now, we did the retention analysis for you that showed a huge increase in retention differential in those distribution centers so that the engagement translated into greater employee retention. I think taking this sort of different approach as partners, you're able to get results that make people's lives better for your team members, but actually for the company delivers results that you wouldn't normally expect.

LP: I love the last example about using the imagery and the language and the communication. That's the reality that we're in right now, too. That's not a new program for us. That wasn't rolling out a new benefit. That was repackaging something that we already have. And in tough environments, and everyone knows, your benefit budget isn't necessarily getting bigger and bigger every year. If it is, tell me your secrets. And so instead I was saying, okay, we have an option to do something different with the communication here. Let's go use our data to figure out what group are we specifically talking to. Everyone will benefit from it. 

LB: That brings me to something else that not just Target, the number of our other clients asked for, which is they were saying, “Hey, look, we are struggling to have enough access to mental health providers for our employees, because it's gonna bankrupt us if we have to send everybody eventually to one-on-one therapy? What can you do to help us?” It's a real crisis. And it's to your point, how can we make it accessible, equitable, and affordable? And that's where Grokker Guides came from. \

And again, for those who don't know what our Guides are, Guides, essentially, take the best of what Grokker does, which are experts. It's cohorted groups with the community at the core of it who guide you through a 30-day program where every day you have microsteps and once a week you meet with the expert in your cohort group to check in, but you've got evidence-based evidence-based programs that are helping you learn lifelong tools, but you're not alone. And it's not therapy per se, but you're learning CBT skills and you're feeling progress and assessment at the beginning and assessment at the end. And it was all because people like Leslie were saying, “Hey, we need something that's different and that's not just one-to-one therapy that's actually proven to work.” 

In your experience, what are some of the top barriers to being successful with impacting employee wellbeing?

LP: Target has a very strong culture around team member sentiment and team member insights, we have a whole team dedicated to it. And we do it on a weekly basis, we do small poll surveys, but annually, we do our large employee satisfaction survey. We have the privilege this year of being able to add to that. So every team member who's going through that larger survey had an option to say, “Hey, do you want to jump into this benefits, a benefits-specific survey?” And we had an overwhelming response to that. People have feedback. So, what that did is it gave us this new position to say, okay, with the data that we have that we get out of our benefits portfolio, as we look at utilization and other metrics throughout the portfolio, matched with now this employee values study to say what's important to you, what's top of mind to you. And part of that was what's leading in the way of your own wellbeing. And so we went out and asked them this question. And what we found was it's, it's affordability. It's time. That was pretty clear and consistent across our entire team member, or team member population, whether that was headquarters or distribution center, our hourly store team members, or our exempt team members. And so something that we have top of mind of, how can you take some of the cost out of the system for the team member, right? And then time. And time is hard, right? No magic wand. Can't add hours to your day. But how can you fit better into the nooks and crannies of the day that helps you address your own personal wellbeing? And I think Guides is an example of that, right? Like you had said, you're doing it on your own time. You're doing it on a schedule that works for you.

And being able to create solutions that allow employees to be able to do that. You know, the other example for us, especially on the affordability piece, was, we have always had a tuition reimbursement program in place for years and years, and it was a great program for us, but when we saw this data around the importance of cost and affordability, we took a pause and we said, we have a tuition reimbursement program, meaning the team member is fronting the dollars, and maybe that's why we're not seeing engagement in our education assistance program, and so we found a new partnership went to a new vendor and it switched us to a debt-free education. And by reframing that as debt-free, and quite frankly, making it to be an investment on Target's behalf, we are seeing more team members engaged in that portfolio, and that is one of our differentiated benefits where I talk in the beginning about what are we going to lean into we call our debt-free education program Dream2Be.

LB: Picking up on that, the two things, time. I remember even when I was doing market research before I started Grokker and I was interviewing people to understand what are the greatest needs that you have around wellbeing and the number one need was I need more time.There are too many demands on me I don't have time and then that the second point is that I don't have the money. It's too expensive. Like there were just the practical realities, right? It was kitchen table conversations, those were the two big issues time and affordability, and sometimes accessibility and affordability are very close to one another. And so it's like, what can you do in five minutes? What can you squeeze in? But it's also making things work on their time. 

LP: It's the guiding up through the defaults. It's “I don't want another decision added into my day and how you take away the decision for them and feed it to them.” I will also say, that I think even framing it up to employees through that lens, like we have, I talked a little bit about modernizing our engagement strategy and the communication that we use to reach our team members is both in. 

LB: It's so interesting because I know that we're coming up to open enrollment for most companies it's in the next couple of months. And one of the things that we know has worked really well, I know that this worked really well at Disney, and I think at GE, it was letting people know that if you buy Grokker in the App Store or in the Play Store, it's $120 a year. You're getting it for free from your employer. So the fact that the, that the team member knows you're giving this to me for free and it's 120 bucks. There's this like, “Oh my God, thank you.”

How can you help your different benefits amplify one another? And how do you think about that systemically across your portfolio of benefits to reinforce that messaging? 

LP: A couple different things in this space and I would say it's a lot of trial and error. We're trying to figure this out as well. I think you hit on something earlier with annual enrollment coming up and using that as a moment where because they have to make a choice, they're paying attention. And so how do you reinforce benefits that they're offered that are part of that total rewards package that they're not making an election decision on, but how do you continue to remind because you have that captive audience if you have an active enrollment? I'll say like for us, it's some of the things that we're working on here or some hypothesis that we're working on is, right now today, all of our employee communication looks the same from an HR perspective, the branding, the tone, the visuals that we use.

And so, we're working right now and actually doing a rebranding. And part of our business case for that change is, everything else you're getting from an HR perspective is about you at work. Our argument is, your benefits and wellbeing information is actually about you at work but really outside of work. And can we have a different look, feel, and tone to our communication that still feels Target, still feels like it's part of our culture of “care, grow, win together,” but will catch your attention in a different way? The other piece for us, and you touched on a little bit of, the success metrics, and I'll say this is like the biggest question that I get from our C suite about, okay, you've invested a lot in the benefits portfolio, how do you know if it's working? Is it utilization? Is that the metric that you're looking at? And I will say, it's a “yes, and” conversation. Yes, utilization is important, but we're not going to have 100 percent utilization in all of our programs, nor do I want 100 percent utilization in all of our programs. And so we're spending a lot of time actually going through some specific benefit programs that we're going to say, well we're going to go deeper on these and we're going to spend more time figuring out what are the key metrics that we're going to want to look at.

The other piece of it is a little bit of an acknowledgment that awareness is important to your total employee population, not just because it'll translate to the utilization of those programs, but because of awareness across the portfolio and the value and the pride that employees will get in just because you offer it. I'll say personally for Dream2Be, our education program, I’m not going back to school. But I have an immense amount of pride in the fact that my employer offers this to our employee population. I feel so much pride and so much connection to our culture when I see those team member testimonials come about someone who went back to school and is now advancing their career at Target because of that debt-free education and that barrier was removed for them. I feel an immense amount of pride when someone utilizes a program and talks about it to their peers and now their peers using it so it's not all going to be about individual utilization. There is this lift that you get across your employee portfolio because of acknowledgement awareness that it's something that your employer has spent time and resources on.

LB: So two things I want us to talk about a little bit more. One is, that you're talking about the team member, you want to talk in the voice and the branding that won't just be “this is coming to you as the employee at work.” And I think that is a modern, realistic, and innovative approach. That is completely against the grain of what most benefits leaders are doing. I'm not sure if it's against what they're thinking, but it's definitely not what they're doing. Partially because most of them don't have the resources to effectuate that communication. I know for a fact from the surveying work that we do, we've got millions of covered lives when you think about all the employees and all of our clients, and they tell us that if it's another email —and by the way, they will tell us, [because] we do a lot of MMS and text messaging for our clients because the employees, they are a little sick of email—but what they'll say is, “I don't want another message from corporate HR.” And one of the things I'm wondering is if you're giving advice to people in the audience right now, and you're prepared to experiment, Leslie. And that's the key to success. Right? Being prepared to try and fail quickly and refine. How do you get your team to be okay with the idea of “I'm going to try it might not work and fail quickly and try again.” How do you get that to work within your team? Because it's not the general DNA of an HR function.

LP: First of all, I'll say we're in the middle of it. We don't have it all figured out. And so, fail and fail fast is absolutely the name of the game. Also, we're not going to do it over the whole portfolio. We're not going to try new and fun things at the annual enrollment. You have to nail annual enrollment, right? So, it's picking the areas where you can lean in a little bit and try new things. For us, what we spent some time doing was, we have our ongoing strategy for communication and engagement, and this is ticket to entry. We're going to keep going with all of that. We actually hand-selected a list of six benefits.

And so we're going to hold these up. These are marquee programs. These are the six we're going to try some new things on. And then we went to different partners across the organization. We have a whole group located in the southern part of the U.S. and said, do you want to be partners with us? Now I will say that that is because we had an awesome group vice president who attended a session on his own executive benefits and said, how do I bring this to my team members? And we said we're looking for a partner to try some new things with and he let us in and we have amazing HR Partners in the field who are helping us but it's no regrets things. It's okay “Let's take 10 minutes of a regular meeting that they have and we'll go deep on one of these six marquee benefits and then let's measure what happens.” And in that case, we saw a 24 percent increase in participation and the rest of the organization was flat because of a 10-minute presentation with the frontline HR leaders in that group of the country. I feel like the keyword we've said 27 times on this discussion is partnership. That was partnership with the group vice president who's in charge of running a group of stores who said, “I care about this, I care about it for my team, and can you, can you try something new?”

LB: There are three things: one is, what problem are we solving? Not, what are we giving you? But, what problem are we solving for you? The second thing you said is, you then fit into something that we're already doing. And the third thing is, you gave them a business case. Right? So you got a group vice president who was like, “okay, I'll give it a whirl.” And then you showed that it worked. And so those three things are like, who wouldn't want that? Right? So it's strategic, the experiment isn't everything. It's one thing. And yes, it worked and we'll keep going, but it's so great that you approached it, frankly, like a sales and marketing exercise.

LP: Which is exactly what we're doing with an end cap in the store.That language translates. 

LB: Totally. And so that is what's so innovative about what you're doing, and it's also part of what, what like we, we're doing to also help you to show and to sell up. And so if we show, for example, the retention model, the economic model to show why they want to not just continue to provide the budget to the benefits team for this, but why they want to give them more money. And it's to show that. And, you know, this benefit will lower churn by 32 to 68 percent and the CFO goes, “what?” And then we show the economic model and it's completely vettable. We have actuaries that back this up and we then show the numbers. This isn't the Target one, but right, 20,000 employees and you know what the participation rate is, how many employees are, would be using it, the difference in the retention rate. And then if you take a 4500, which is the low end of a replacement rehire, then you would be saving 5.8 million in the year just for the job saved. And we actually do, we provide the model, we give you the actual number of jobs saved that year and how much money you saved.

Talk a little bit about your vendor summit.

LP: Yeah. So it's an annual event for us and it's called the Strategic Supplier Summit and it is across all of HR. So not just the pay benefit space, but the total HR portfolio where we bring our strategic partners onsite. And they hear from our CHRO, they heard this year from our Chief Growth Officer, Christina Heddington. And we spend an entire day together really sharing out Target strategy, targets, HR strategy, where we're struggling, right? And bringing those, bringing those partners right to the table with us and then creating forums for these different partners to meet and connect with each other. And it's such a special event. It is highly produced. I'll be very transparent on that. We have great partners, but it's because it's worth the investment. It is worth the investment to make it a highly-produced event.

Because what it has done for us is build connections really quickly that my team can't do on their own. They are heads down with their own vendors. They are working through, you know, all the various aspects of a vendor relationship. And this allows us to take a step back and actually have those partners talk to each other and build those connections. And it pays dividends by taking an entire day, flying people in because the outcomes that we get from that are so important for the strength of our portfolio, our benefits portfolio, and bringing our strategy to life. And I will say we spent quite a big percent of that time actually going through those strategic priorities that I've shared with you guys today. And since that summit that we did in July, the emails that I get have a different tone. It is the vendors who are saying, “I know you're focused on affordability. Here's some things that we're doing within our own program or our own company on affordability.” And so taking the time to do that, it sounds daunting, but it pays dividends. And the energy coming out of that. I don't know how you replicate. 

Are you using, as a part of your benefits strategy, any generative AI to either capture or formulate your solutions? 

LP: I love that question and I will say it's probably the biggest thing that we have in the monitoring bucket of watching the industry, watching what tools come to fruition to try to figure out how can it, I think we see it coming. We're not there yet. It is top of mind for us in any vendor conversations because I think that's going to be the game changer from a utilization perspective. How do you reach audiences? And, at the end of the day, we know the number one thing that's going to happen in the wellbeing space is flexibility and personalization. And I think that's going to be the biggest key to get to that truly personalized piece. But we're not there quite yet. I know top of mind for you as you're thinking about your solutions going forward. 

LB: We've actually been using AI for many years. AI is not new. It's just sort of become known publicly. And the generative piece, you know, with BARD or Chats GPT being publicly available is, but it's really not new in the, in the tech world. And so our recommendation engine has been powered by ML machine learning and AI for some time. And it continues to get better, but it's an important piece of our tech stack. That's been a part of it for quite some time.