In his time at Buck Consultants, it's safe to say Fraser Smart quickly distinguished himself would be a bit of an understatement. Joining in 2006 to manage the firm's Edinburgh and Manchester offices, he was appointed Managing Director of Buck in Europe in 2010 where he oversaw four consecutive years of record results, leveraging Xerox's considerable investment in technology to develop solutions to help clients improve the efficiency of their HR function. This year, he's relocated across the Pond to New York, where he has taken the helm as President of the firm. Smart sat down to discuss his new role, plans for growth, and pain points facing HR clients.
Consulting: What are your top priorities in your "first 100 days"?
Smart: My top priorities have been to get steeped in the U.S. business, and to meet with as many clients and colleagues as I can. I'm working with my leadership team to continue to evolve and precisely define Buck's unique value proposition and our target market. I'm ensuring that our consultants are talking to clients about our differentiated solutions. And I'm working with other leaders in Xerox's services business to fully integrate our consulting and outsourcing businesses—something we've made great progress on since last summer.
Consulting: What are the biggest challenges and opportunities HR clients are facing today? How do they differ in the U.S. and abroad?
Smart: I see some new and not-so-new challenges and opportunities facing our HR clients:
• Doing more with less. Cost pressures never let up. This is where technology can drive game-changing solutions and help deliver better outcomes. This can also have the benefit of bringing our clients more in touch with their employees, especially younger workers whose expectations are very different from those of other generations.
• How HR professionals can bring strategic value to the business (and unburden themselves from transactional tedium) in order to earn their seat at the boardroom table. This is an ongoing challenge, and I don't think this nut has been cracked yet. Outsourcing is part of the solution. Another part is having the right people in the right roles, especially after adopting an outsourcing model. Retaining key performers is also a major challenge we're helping our clients tackle.
• Engaging employees in their health, wealth, and career. Employees must become better savers for retirement and better consumers of benefits. But truly engaging employees is a tough job. Technology has evolved from simple self-service solutions to personalized portals and retirement planners, for example. I see our capabilities in analyzing big data and personalized messaging as the next hot spots for driving desired employee behavior. These solutions will evolve extremely rapidly as the market keeps pace with developments. Retirement readiness (baby boom generation now, and others later) is a major engagement challenge for employers since the gap between life expectancy and healthy life expectancy is rapidly increasing—leading to a crunch for both savings and retiree healthcare. We are developing solutions combining health and wealth to address both of these issues.
Many of these U.S. challenges are common with those in Europe. The United States places more emphasis on individuals (or their employer) taking responsibility for their own retirement and healthcare, so the impetus for developing good solutions is that much more important. The other immediate observation is that U.S.-defined benefit plans are far behind Europe on long-term planning and risk management—something I expect will change rapidly over the next year or two.
Consulting: What are your plans for growing the business? What are some of the biggest opportunities you see for Buck on the horizon?
Smart: Buck's mission today is to create better outcomes for both employers and employees. We're developing innovative solutions that accomplish this—for example RightOpt, Savings InSight, and BenefitWallet. This is all part of Buck's portfolio diversification — including our increased focus on direct-to-consumer solutions that our clients can offer. Earlier I mentioned integrating our consulting and outsourcing businesses. We've now attached a consultant to most of our outsourcing engagements to bring added strategic focus for our clients. We continue to take advantage of Xerox's footprint, R&D, and client base. For example, we're currently leveraging Xerox's Palo Alto Research Center, better known as PARC, for innovation development. One example is the Fittle mobile health app.
Consulting: What's your overall impression of the HR/Benefits consulting market today?
Smart: A few thoughts: The market will move from a B2B to more of a B2C model. That is, more solutions will be aimed at creating better outcomes for employees. Innovation and technology will become ever more important as employees expect information and guidance at their fingertips 24/7. Consulting and outsourcing businesses will need to link seamlessly for clients. Client buying cycles are longer than in the past—some clients are trying to take work in-house. Profit margins will depend on type of work. More fees may become contingent on performance/results.
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