August 20, 2020

Global Broker Guide

This guide breaks down the process, from business case development to account management, and provides employer tools and lessons learned from utilizing this strategic relationship with global brokers.

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Most companies only do an RFP "as needed" rather than on a regular cycle. "As needed" is usually when issues arise, and service levels decline. Otherwise, if the relationship is working, the contract often renews without a competitive bid. Given that reality, putting the time and effort into a robust RFP initially is a worthwhile investment.

Consider the following questions as you develop your RFP:

Who Do You Invite To Bid on the RFP?

What Do You Include in the RFP?

The RFP should include:

• 1 | Information on your company’s strategy, vision, organizational structure and governance framework;
• 2 | A clear outline of your needs (geographical footprint, volume of policies), as well as expectations (both general and service-level agreements) that the company has for services provided by the local, regional and global contacts;
• 3 | Detailed questions the company wants to see in the response regarding capabilities and technology (including data inventory and analytics systems);
• 4 | Top competitive advantages; and
• 5 | How a particular broker’s approach differs from competitors.^1,4,5

To ensure that your company receives adequately tailored responses, it is highly recommended that you share your company’s guiding principles, benefits strategy, key global initiatives, business priorities and organizational structure in the document.^1,6 If you send out a generic RFP, you will receive a generic response. You should also decide how much detail you wish to include in your RFP questions.¹

What is the Biggest Differentiator?

Members find that when looking at the handful of main providers to serve as the global broker, the geographical footprint and capabilities are much the same between them.² Also, pricing can be similar or negotiable to be similar. If that’s the case, what sets bidders apart?

Below are some key considerations that members shared and should be discussed during the RFP and selection process. Questions in the RFP is one way to find out bidders’ approach to these issues. The interview also gives you an opportunity to dig deeper on the following:

Strategy

Structure

Learnings From the RFP Process

Sometimes challenges experienced post- implementation can lead to best practices that could be implemented during another RFP process. By doing so, challenges you’re experiencing now could be avoided a second time.¹

Some examples of challenges that could be considered during the RFP process include:

• Lack of consistency in service across different countries. It can be harder to find proactive quality services in smaller countries and easier to have higher quality services in locations with high employee populations. In countries with a small employee footprint, members commented that they found it harder to have services reflective of their expectation of a consultant; rather it was truly only broker quality service.¹
• Collecting good data from each country can be challenging. One area of difficulty is determining the health drivers of cost increases, which would help employers address employees’ needs in a cost-effective manner.¹

Which Stakeholders are Involved in the RFP Review and Selection Process?

Determine who will be included on the team to review RFP responses. Ideally, responses will be evaluated by a selection panel representing key stakeholders, including Compensation & Benefits (globally and regionally), HR Delivery/Administration Services and Procurement.^1,5 Legal will also be involved at some point.¹

Interview Process

As part of your RFP, you will need to decide which stakeholders are involved in the bidder interview process.¹ During the interview, you will want the bidders to elaborate on their written responses and give real world examples for the interview team to react to. These interviews should act as an opportunity to ensure that the bidder and company’s vision and expectations are aligned.

Who Makes the Final Decision on What Broker is Hired?

Who has a vote? Who makes the final decision? These answers can vary by company. Most global members described the process as a joint effort between corporate and local, looking at capability and cost. At some companies, the capability analysis is done locally, and the decision is made collaboratively. In other companies, local and regional colleagues provide input, but the decision is made by global headquarters. For some companies, regional colleagues are an equal stakeholder in the selection process.Incorporating the regional team in the RFP selection process makes the regional colleagues feel more positive toward the global broker partnership.^1,5

Which Criteria are Most Important in Your Broker Selection Decision?

As the employer’s stakeholders review RFP bids, they will want to know how the company is evaluating responses so that they can weigh criteria based on the company’s priorities. This will allow for all parties to arrive at a consensus on which global broker to choose. When drafting the RFP, consider what the key criteria are for your company and ensure that you are asking for enough information in each area to be able to effectively compare and evaluate responses (Figure 2).¹

 

Figure 2: Most Prevalent Factors Global Employers Used in the Selection Process

See the Employer Tool: RFP Comparison / Selection Process Template for a sample.

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