Craig Babigian Interview

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Craig Babigian Interview

[00:00:00] Why come to the PEO podcast, where we interview industry leaders to discuss all things PEOS from compliance to technology, to client relations, everything in between I'm your host, Andreas Deptolla.  

We were the newcomers and many of the newcomers had a history of not waxing in the industry. There've been many ventures vendors who have entered this space.

[00:00:28] And after a few years realized that unique needs of PEOS compared to the revenue potential was not a good business decision for them. Um, you know, in my opinion, you need to have a high commitment to the space to be successful as a vendor.  

Hello and welcome to the PEO Podcast. Today, we are talking to Craig Babigian, Executive Vice President of PrismHR.

[00:00:57] As the first employee of the company would dive into [00:01:00] prison. His early days at evolution of PrismHR

[00:01:08] there too. Um, 1996, um, you know, we mainly serve standalone companies with their HR technology. No, we had some direct clients, but most were sold through resellers. So we had clients in distribution, light manufacturing, um, home health care, some airports, and then some lot of one-off types of industries. And then in 1996, we were contacted by a PEO in Florida.

[00:01:44] Um, at that time, we had never even heard about PEO. So they, and they heard about us through some large corporate clients of ours that we had in Florida. So we presented to them while we had, um, and they felt the base of the [00:02:00] system, you know, would be a good fit for the industry. You know, it took us many months to analyze their needs.

[00:02:07] And then to enhance the product to, you know, fit them those needs. Um, and they went live in 97 and, uh, they have a little greater than 10, a thousand work site employees, which at that time for us was big, right. That's mid-range for us now. And then since then the, uh, the PEO industry has been our major focus.

[00:02:33] and, and we've been successful in this space. Uh, partly due to our commitment and passion for this space and probably some luck too, you know, as there always is, you know, many well-known payroll and HR products have entered this space over the years and actually most have failed. And it's not because they're bad products.

[00:02:55] They're actually very good products, but the structure of their system. [00:03:00] Systems didn't play well, uh, with, you know, with the PEO nuances and frankly, the changes needed are quite extensive. You know, luckily our structure worked well, uh, for how a PEO operates, uh, and we were willing to make those changes needed.

[00:03:17] What made PrismHR really successful in the PEOS space over the market? You mentioned the focus on the field or specific needs, um, willingness to change. Are there any other characteristics that you set, like, you know, were really key and fundamental to the success of the company? Again, maybe this is part of the luck, um, when we enter this space, um, it was really all about the back office, right?

[00:03:45] Uh, back-office efficiency. Yeah. How can we do more for less? You know, you know, we, we buy benefits, we build for benefits. How do we make sure we get our money? So that was the focus. There was no keep in mind, this is 96 or [00:04:00] eight. It was no client facing technology at that point. So there was no electronic onboarding or benefits enrollment or employee portals or anything like that.

[00:04:10] It was very focused on the back office efficiency, the small group that we were at that point, not that I'm technical, but the others were technical. We're all. Business-minded. Yeah, I have an accounting background and others had accounting backgrounds, so we could take business needs and interpret them into technology.

[00:04:28] So I think that's one of the advantages that we did have at that point and why we were probably successful and our platform also. Even though we didn't have the clients of the size as we do now. Um, we were starting to get individual clients with, you know, individual sizes in the thousands. So we had done a lot from the efficiency of the process.

[00:04:52] So that did as well. So I'm going to go back now, if I, if I did my, uh, research correctly here, you, you were one of the first [00:05:00] employees at prison mansion. How do you get connected to the founders, to the ecosystem? Tell us a little bit more of like how everything start. So the, the roots of the company go back to 1985, um, started by Fred Davidson and Fred Davidson.

[00:05:17] Um, Back then started up a consulting company, working with small businesses and helping them write custom technology for small businesses. That's when actually I was first introduced to Fred. I needed help writing technology for the space that I was in. And, um, and frankly, I didn't start actually I met him in 85, but it really didn't start working with him until 87 or so.

[00:05:41] Uh, because I felt I had to work with a bigger group, which failed. So I ended up going back to Fred route 88. And so we were actually, so we were working together from that 87 88 timeframe in the early nineties. You know, I was, uh, at a, uh, Service oriented [00:06:00] business. We had 90 employees using a third-party payroll product, and I realized that I want to bring payroll in house because you know, 45% of my cost was labor.

[00:06:11] So I want to get a better handle of the reporting and such all that. So I can haunting Fred about, Hey, do you know any good payroll products out there? And one day he said, you, he said, so looking to get into something versus being this, helping businesses do everything, you know, I want to get into it. He had a payroll background.

[00:06:29] He says, what if I write it? I said, go ahead. And, and so, so he did, and I was the beta site for it. And we always well, well together, I mean, I was always intrigued by. Uh, Fred's integrity and it was something unsaid. We never even talked about it, but it was something unsaid that as he got to a point that it was something that, um, we would join together on.

[00:06:53] And that's what happened. Having started to company on my own here, I can imagine that like specifically in the [00:07:00] early years that there were quite some challenges. Right. Well, what do you recall? What were the big, big obstacles for you guys? When I joined, Fred was late 93, early 94 timeframe. And there was two of us, right?

[00:07:15] By 2000, we were at a whopping 15. Wow. Look out so many years, uh, when you're that size, you're wearing many hats and that teeth suit you well later because you have a good feeling about all that's happening, but this is typical for any small business. So really it was more of the small business type of issues that.

[00:07:40] Every small Bishop business has, you know, the challenge for us when we enter the PEO industry was something we didn't anticipate. Uh, by the time our first client was going live, uh, we'd already signed up. Two more albeit small CEOs. [00:08:00] And we thought we were the hottest news in the industry, like, yeah, wait until they see us.

[00:08:06] Uh, and that was until, that was until we attended our first Napier annual conference in 1997. And that was held in San Francisco, by the way. Naviaux is the leading trade organization in the PEO industry. So. Here we are in our booth and had limited interaction with the attendees. I mean, they'd Bailey glanced at us, you know, and we're wearing, what did we do wrong?

[00:08:34] Right. And the truth is that we were the newcomers and many of the newcomers had a history of not lasting in the industry. There've been many ventures vendors who have entered this space and after a few years realized that the unique needs. Of PEOS compared to the revenue potential was not a good business decision for them.

[00:08:57] Um, you know, in my opinion, [00:09:00] you need to have a high commitment to the space to be successful as a vendor. Now it took us some years to get some traffic in our booth, whereas today, um, where we attend that conference, it's like homecoming for us. So, you know, it's, it's, it's two worlds, you know, another challenge.

[00:09:19] Is how different PEOS handle their operations. There's a popular phrase in the industry that once you see one PEO you've seen one PEO in the early days, we found ourselves doing significant development for every new PEO we brought on board today. Not as much. You know, after you have, you know, 300 ish, you know, under your belt, you've encountered most of the variability, not to say that we still still don't have to do some customization for some, some of the larger ones, but it's nowhere close to what it was back then.

[00:09:56] And I guess going ahead then, you know, the last [00:10:00] challenge for us was about nine years ago, we were a company of about 35 employees. Last week when I checked, we were at 444 employees and 40 contractors. Now, I know that's a lot of fours in there and that, you know, hockey stick type of growth, take some time to getting used to, you know, you have to fit into those clothes somehow.

[00:10:22] So it took us a few years to get comfortable with that type of growth, which we have for now for a number of years. And you mentioned a point you set, like at the beginning, you know, a lot of the new clients required customization right. In special development. And that, that obviously is hard to scale, right.

[00:10:40] Uh, you mentioned, Hey, then we shifted more into standardization and then. Yeah, one product, so to speak, was that a national natural development over time, or was an infection point where the PrismHR leadership team said, okay, we gotta, we gotta change, um, our strategy here, [00:11:00] uh, in order for this to scale.

[00:11:02] It's not so much that the custom was that custom. It's just that every new one brought something new. If frankly, at the end of the day, there was another user or 10 users who were going to use the same thing. So yes, they're all different. But after some time, You know, you'll get it too. Like it might be industry, they serve.

[00:11:23] So, you know, I remember one of our earlier ones focused on transportation. So those are the industry they focused on. They have to be versus a PEO who handles one transportation client. Right. So there are some unique type of calculations and processes that fit. The transportation space. At that point, we didn't have the need.

[00:11:47] We did it for this company later on. We brought on clients who had individual transportation clients that, wow, this is great. And we've actually brought on our other clients that they just focus on transportation, which is great. [00:12:00] So even though it was custom at the time for that client, we really became part of the product.

[00:12:05] So he really grew the product over time. So it wasn't a switch basically makes sense. It was more of a natural development, so to speak, right. And the platform grew with the needs of its clients. You know, we talked a lot about the beginning, right in the mid nineties. If you now fast forward to today, what is your current focus and role was in the organization?

[00:12:27] So my title is executive vice-president area and the reality is I still get involved in many aspects of the business. For years. I've been kind of the liaison to the industry, served on boards and committees, and still do the press with a lot of committees in this space. You know, again, it's not a specific role that I still love to dabble on, on the product side, even though I'm not necessarily.

[00:12:53] In the product team and, um, client interactions, industry compliance. So again, I [00:13:00] still dabble in many areas, so it's not a one specific area that I personally get involved in. And it seems like, you know, this, this, um, seem you mentioned in the early days, right. Where you have to wear many hats. Um, so now if we, if we take a little different lens here, right away from Perlmutter specifically, and like moving more into the industry as a whole, how, um, you know, over the years, what are the main changes that you've seen?

[00:13:30] What, what the, what were kind of like the biggest, uh, inflection points of the industry? PEOS have historically served the blue, gray color space, largely due to the arbitrage in workers' comp and unemployment, especially workers' comp. Right? So in the earlier days, it works on employees. We're not the most tech savvy.

[00:13:54] Therefore the technology serving the industry really focused more. As I mentioned before on the [00:14:00] back office, see of the PEO. So this may the technology. Less appealing to the more tech savvy white color. You know today, uh, the focus for PEOS is no longer arbitrage, mainly because you can't do it in certain areas anymore.

[00:14:18] So, um, so again, it's still there a bit, but it's not the main focus and PEOS are actually going after the tech savvy white color, you know, and above and beyond that the blue gray color is also today. Tech savvy, the audience has changed. Therefore, it took a little time for the tech, uh, the technology focus to be more about the client and employee experience today.

[00:14:47] That's there. I mean, it took a few years for that to transition to that. In my view, the, the challenge is, um, is for many of the PEOS to get comfortable selling that, right. I think there is somewhat [00:15:00] still selling on that. The technology doesn't compare in, in it does today. So that's been one of the challenges for the industry, um, or I should say of a change for the industry.

[00:15:13] The biggest change has been awareness. You know, for many years, if you mentioned PEO people would crush, what's a PEO right. Today, the knowledge of PEOS is far greater, especially in the business community. And there are surveys that show that, and sometimes I read the believer surveys, the numbers I see, and some of them.

[00:15:34] Yeah. Uh, but it's, it's definitely far greater and this can be attributed to, um, to the good work PEOS have done. And also Napier has done a nice job raising awareness for their marketing campaigns. Also due to the fine work of PEOs and NAPEO is now referenced in federal and state legislation. Now, prior to that, you know, where they weren't [00:16:00] referenced, you know, one question per comment you would hear is, is this legal.

[00:16:04] Right because you see no reference to it. And it's no coincidence that, uh, when the SPEA law was passed and the term PEO showed up in the IRS code investment in the industry increased significantly. That seemed to be the point when that happened. What that did is when the term PTO started showing up in legislation that added a level of certainty and legitimacy of lack of a better terms to the industry.

[00:16:37] And, and, uh, you mentioned a side note, one sponsor certainty. Uh, from a legal side, was that was there in the industry investment came. And are you specifically referring to private equity, acquiring, uh, PEOS merger and acquisitions or what's presumably due you demand there? Right. Well, mainly that [00:17:00] mainly that the private equity dollars that are in this space now, it's amazing.

[00:17:04] The calls, you know, we all get about, Hey, do you know, who's selling rights? It's like selling tickets. Right. You know, it's it, there's a lot of buyers out there. A lot of folks willing to invest in this space. Because they see it's growing. And again, I think the, definitely the certainty as it has influenced that.

[00:17:26] So, and I assume that was a private equity investments. A lot of these dollars are then deployed into growth strategies, go to market sales and whatnot. That might then also to your point helps the industry as a whole, right? With this awareness and other things. So, so now if I'm in P on a, uh, and I still on, you know, the vast majority of my company, I'm not PE backed.

[00:17:53] Right? What have you seen that? Like some smaller P or, uh, I doing successfully that are [00:18:00] not PE backed you're right. Quite honestly, there's a lot of besides investment by private equity. There's a lot of mergers going on. Usually by our clients, um, requiring other, um, clients or other folks. But, um, so there's definitely that, so that you're seeing some of the larger ones getting larger, however, there's still opportunity for the smaller PEOS and believe it or not startups.

[00:18:24] No, it's not what, like what it used to be. I mean, to start up a PEO today, it's no longer, you can start up a PEO in your basement with no capital. Right. You know, you definitely need capital for, you know, legal health licensing in certain States bonds. And, um, you should also have the know-how how to run a PPEO.

[00:18:45] Right. So if you're a startup, however, what is easier and accessible to startups in the smaller PEOS is access to technology. And really the cloud changed that, right? With cloud computing and [00:19:00] paying for what you used, uh, or use, um, that is definitely leveled the playing field. You know, sometimes becomes the other question.

[00:19:09] Okay. The playing field has been leveled there. So, um, how the bigger player is differentiating their technology from the others. And they do it by really focusing on the client and employee facing stuff. Right. They're customizing that and not, I'm not just talking about colors and I'm talking about.

[00:19:29] Rewriting it. So if the platform allows for that, a lot of them doing it because really that's what the client and employees see. So that's how they're differentiating with do that level of customization and are integrating other technology. But back to your question, as far as the smaller PEO, now they compete.

[00:19:49] There are SMBs out there that just prefer partnering with that smaller local company. They feel they get more personal service and many times the [00:20:00] leadership of these smaller PEOS or the regional PEOs have relationships with the local business community. Yeah, which is tough to do for the more than national organizations.

[00:20:12] So seems to be about Gavin specific focus, right. And segmentation clearly know who are your clients? What's your ideal client profile. You have, you've seen the industry for years. Right? Let me maybe ask the question from a little bit more for a generic perspective. What have you seen that PEOS. Uh, did wheelie weld become successful?

[00:20:38] Were there certain like criteria or common practices where I said, okay. And then also the flip side, right. And I'm sure you've seen PEOS that didn't make it over the us. Right. And that, that, that has afford, you know, any sort of pitfalls and whatnot that you would say like, Hey, these are things too early on.

[00:20:58] You saw some [00:21:00] taking certain risks. That they shouldn't have as much more governance on that today. Um, so thankfully you don't see that because really that also gave the industry a bad name, you know, overextending themselves in certain ways. So I think they've gotten better at that. I think they instill is there somewhat today?

[00:21:20] Is that overall? I don't think the. P L do a great job, really articulate their full value. They've delivered a lot over the years and then delivering even more to them, you know, in my opinion, SMBs don't appreciate the total value they receive from a PEO. Uh, they knows valuable, right? They'll probably always stick with that, but they do.

[00:21:43] They truly know what the total value is. And as I mentioned before, No just now that most peels don't do a great job articulating the full value. Um, you know, especially for an SMB, you know, the expertise, the service, the [00:22:00] technology and products that you receive from a PEO for what they pay that can't be matched.

[00:22:05] And there's the cost of what I just mentioned, but there's also avoiding the high fines and fees for not doing something correctly. That's always been there and getting greater. And then also when it comes, when it becomes a challenge to hire and retain employees, as it was say a year ago, and I think it will become that again.

[00:22:23] The difference a PEO makes to that small interested at SMB. I'm not sure how you assign a number to that. Consequently, historically the PEO retention rate has hovered around 90% and it's still there. Right. And frankly, the 10% that churns, um, some of those are going to other PEO, so they're staying in the same model.

[00:22:47] So not quite sure how much. Is actually getting away from the industry because of that type of retention. And again, some of the others are going just to another PEO. So it's staying with the same model. I emphasize SMBs, which [00:23:00] again, in my opinion is a no brainer levels. The playing field where they're competing for talent against larger companies.

[00:23:07] Now having said that lately, We're seeing an increase in companies with hundreds and sometimes thousands of employees signing up. So they're also seeing value. The other ones are obvious. So I'm not a hundred percent on why recently we're seeing this. Maybe it's because that, Hey, yes, maybe this is going to cost us more than if we did on our own equip thousands of employees, but this isn't our core.

[00:23:34] This isn't what we do. Right. Let's give this. Just someone who does this and, you know, as a business. So it's maybe because of that now. In that same thing. I think if you're a PEO client and all is running smoothly, you take it for granted. You no one wakes up in the morning and say, ah, I wasn't fine today.

[00:23:55] Great. And again, they really don't appreciate [00:24:00] all that takes to make that happen. COVID was a big deal COVID had, could have been devastating to PEOs because COVID impacted small businesses. The most. And who do peels serve small businesses and they weren't impacted, I mean, you know, if you look at their work site, employee counts, they went down, not as much as the rest of the population.

[00:24:28] Um, but they were definitely went down. Yeah. W we, we definitely saw dips to that. Uh, but those kinds of actually come back and have. Gone past where they were last year at this time. Um, so they've rebounded. I mean, I know, um, Naviaux does their, one of the numbers they have is based upon the third quarter, nine 41 compared to the prior year, nine 41.

[00:24:53] Um, so there are nine 41 numbers in the third quarter of. [00:25:00] 2000 to 2020, which is probably the lowest point of any time, right. That had grown, I think, 8% compared to 2019, which is probably one of the highest points in the economy. Right. So even during COVID they increased, they rebounded to that level. You can't find that anywhere else.

[00:25:22] So, um, now. Getting back to COVID. So again, it could have been devastating the PEO industry at the end of the day, the value of PEOS really shine through during COVID. Um, you know, PEOS really stepped up, um, in helping their clients navigate all the COVID legislation, help them with their PPP loans. You know, as far as getting the loans and then laying out the paperwork after that, just saying those, those costs.

[00:25:55] And I believe that businesses that experienced that [00:26:00] we'll never forget it. And I think the word has gotten down to the business community because PEOs are assigning up clients new to the space, excuse me, at a rate that has never been seen before new clients, you know, new blood to the industry. Going back to an earlier question you have about smaller peels also during COVID.

[00:26:20] Yeah. And you're a smaller regional, I there's so many stories of the. The leadership of those small PEOS calling every single client of theirs and asking them, how are you doing? How are you doing? Right. They'll never forget that. So what could have been devastating to this industry? And it hurt for a little bit, a lot of work.

[00:26:45] You know, some revenue loss, uh long-term it's um, it really allowed the, that to shine through as far as what their value is. Seems like, uh, you know, that's a lot of economists right [00:27:00] now predicting a fairly positive outcome here for the U S economy in the short term, based on what you saying, are you expecting the same growth or higher for the PEO industry as a whole.

[00:27:14] Oh, without a doubt, because keep in mind, they're bringing new clients, but the existing clients, they have, they still haven't hired back all the people. Right. So you're going to get that on top of. New growth and new growth that they've never seen before as far as the client count. So yeah, no, just on that.

[00:27:34] And again, the word is getting out on the value. I think COVID also gave business's time to sit back and rethink how they do business, because a lot of things have gone to this. I mean, I re referred to, I mean, again, Napier has done a phenomenal job and marketing and, and awareness. There's new campaigns out there.

[00:27:54] So all this comes together. Right. Um, you know, seeing the marketing, seeing the [00:28:00] messaging, hearing from other small businesses, how PEOS help them. And, um, so yeah, I, there's a very bright future there. So, so you mentioned, Oh, I conversation Dave multiple times, like the technology and like, you can, uh, I can sense you're you're, you're passionate about this, right?

[00:28:17] Uh, if you now look out here for, for the next. The years to come. What kind of trends IOC seeing, um, what kind of trends should O leaders, um, watch out for and focus on? Yeah, sure. So maybe right now, not so much years out, but what's really kind of trending and popular now. Right? It's really about delivering more and improving the experience of the work site, employee work site managers, and, you know, it's making the portal something more than looking up a paycheck or reviewing their benefits or getting a W2.

[00:28:55] I mean, those are table stakes. It's about providing more information. [00:29:00] Access to processes, access to products. You know, making that self service, that portal something that employee and manager depends on on a daily basis for a variety of reasons. And, um, you know, whether it's, I need to know where my, for how my 401k is doing or what benefits do I have, or should I change this?

[00:29:22] Or a host of reasons why? And in making that a destination on a daily basis is getting them in now. Take that further. Okay. So you have this employee experience that people can look up and change things, right. But how can we make that better? Where triggered workflows are key to this too? Right? So let's look at an example.

[00:29:44] Let's say an employee has a life event. Let's say it's a newborn. So the employee indicates that they had a life event with a date. I know we had a baby on this date and they indicate that that on the portal, you know, that trigger is a life event. Benefit enrollment. Which alerts the employee. Now [00:30:00] you're eligible to change benefits or add dependence and so forth.

[00:30:04] And then the benefit and the employee walkthrough, they could be doing this on a Sunday morning and not waiting for the HR department. You know, they came home last night, the baby was delivered and this morning it's covered. That's an example, right? It's not just updating my tax filing. It's. Something happened to me and I need to do something about this and it's a Sunday or a Sioux clock in the morning.

[00:30:28] You know, workflows are, um, are key. Making the messaging smarter. So again, focusing on the work site manager and employee facing technology, now let's look at an example for an employee who let's say they're not enrolled in the company's 401k. You can use this space to message them that, Hey, by the way, let's also assume that.

[00:30:52] The client has a safe Harbor match, right? So when the space, you can message them that, Hey, you're losing out on free money here. [00:31:00] So you give them a free money. You're losing out on a free money messaging, click here to enroll. Right, because by the way, getting people to participate in these areas and to benefits and retirements at stickiness to that company.

[00:31:16] So they clicked to enrolled. Now that's for someone who's not a role. Well, what do you do with that same space for someone who is enrolled? Right? Well, because they're enrolled, the messaging is different. You know, perhaps the messaging is your, a 401k balance has increased X percent in the past month.

[00:31:35] Right. Click here for more details, you get different messaging, keeps them engaged. Uh, so those are just a couple of examples that it's not just having a place where employees and managers and go to do something is basically being smarter with this space. And that's today. I'm not, you know, this is not five years from now where we're fighting to be the, probably the most important area.

[00:31:58] Th, let me maybe ask a [00:32:00] question about today then, right? You mentioned really interesting themes here, right? The employee experience information, self service, um, engagement strategy is right among other things we talked about. How do you explain the value to your clients, but on an ongoing basis? Now, if I look at these themes, right?

[00:32:23] That, that available for four P or today, Do you have any recommendation, how to measure that, how to measure engagement and success, and then also provide the clients with these metrics as an audit to, you know, an ongoing basis proof, so to speak the value to, uh, to the clients. Yeah. And historically in peels have actually tried to do that over the years and usually through their CRM product is capturing all they do.

[00:32:51] Now, the, the challenge to that is. For those companies to use [00:33:00] the CRM CRM product, right. Because sure you can. Capture statistics that we produced X amount of checks for you, or we did this and you have things that are generated by the system, which can be part of that report card. You know, do you know, we processed you'll 4,000 payroll check for you.

[00:33:18] Last year, we did this, you know, things that the system does. We can count those and be part of the report card. Uh, but above and beyond that, Yeah, we spent 15 hours onsite training you to do this well, it's that system triggered. So we've and people have been doing this for years. I don't think widely enough are to the extent, but basically leveraging their CRMs and capturing that.

[00:33:41] Um, I know. We output that type of data for the purpose of that far as what people have done, but, and then within our CRM product, we can capture all the other activity. It's kind of blending those together and doing a report card. So that's keeping your current clients [00:34:00] realizing, Oh yeah, you do a lot for me.

[00:34:02] Right. You know, it's just a matter of how do you do that for someone who's not a client, you know, and get them to that point. I mean, I guess the only measurement. To that as far as how successful you are with that is if you change your ways and trying to articulate your value differently, what has been your change in sales?

[00:34:21] I think that's probably the, probably the biggest metric. Well, actually, you know, can I go back to one thing we were talking about about it maybe takes us a little bit more in the future of actually kind of now into the future where I really think the future is, is. Instead of a workflow is if they're not a role do this, you know, something pretty straightforward, right.

[00:34:44] But it takes someone to actually put that logic in the system that if this is and do this right. But reality is where a lot of this is really going is kind of more the AI for many years. We've [00:35:00] been talking about. Big data and AI, but it was always difficult to give real-world examples on how that was being utilized in the PEO community.

[00:35:11] But there actually are examples and it, and it's coming fast and furious, which is. Great. For example, when a SMB comes on board with a PEO there's some, some underwriting process, right? For worker's comp for health insurance, and that's historically been a very long process for the underwriting. Now did the ability to take underwriting technology and integrate that AI technology that's there and in use in the industry.

[00:35:41] So therefore, as data is sent, they're comparing it to millions and millions of records and a response is back pretty much real time. So cutting that lag down, whereas. Prior to that, it was a multi-day process for the underwriting time-consuming and [00:36:00] frankly kind of kills the deal for the prospect. It's such a fascinating topics.

[00:36:05] And thanks. Thanks for making this a little more tangible, right? Like as, as one example of what can be done today and it will be, um, really interesting to see what, what will develop you over the next. Five 10 years, right? Yeah. Well actually, so the couple of other areas, so you have it in the underwriting process.

[00:36:23] Another area is in workers' comp, where. If you're doing claims management, um, in, I know you have history with this, but it's important to really be on top of that claim at all times. Right? Well, with AI technology, again, this is something that's there today. People are using this today. So I have a worker's comp claim and I'm a claims managers, and I have all this information about this claim.

[00:36:50] I can filter it through this AI technology. And again, they're comparing it to millions and millions of records as far as comparing that [00:37:00] claim to similar claims and being predictive about it. So this is what's going to happen to this claim. You're going to settle for X. It's going to take this much time.

[00:37:08] It's going to cost you this, that type of information known at the beginning. I was that claim manager to make better decisions, better decisions that claim manager makes. Makes it better for that SMB because you know, there's a phrase in the worker's comp claims area that your rates do go up by accident, right?

[00:37:29] So better managed claims saves the SMB big time. Another area that's employee facing is, um, benefit selection tools. I know you might say, well, there's been benefits, selection tools out there for years. And that's true. There have been, but when you compare it to an AI backed benefits, selection tool, where it's not just filtering through some simple rules, it's comparing against a million millions of records of people, of your demographic and what [00:38:00] they've done and what they do and coming back with it.

[00:38:03] Oh, okay. I see this. So I just see this, I, those are just four examples that are being used today. Um, so, and that's where I see it all going, uh, making and helping people make better decisions and what we are value at this point, right? If the benefits of section two are getting more sophisticated and we can now help the end users, employees to make better decisions now, and I'll be changing the.

[00:38:27] Selecting benefits is petrifying to a lot of employees. I don't know which one to take. And then, and especially the, you know, the, the nice thing when you're there with the repeal, many times they'll have access to multiple health plans. Right. Which one's better for me, something to instantaneously come back and say, okay, based on I know from you and some of the questions you answered, they're not just.

[00:38:48] Simple rules. They're passing it through. Those are game changes in my estimation podcast is sponsored by strive. Pass a trusted PEO partner for employee benefits from [00:39:00] pre-tax accounts to call by administration drive past empowers employees to thrive through exceptional service in innovative technology, more at

[00:39:11] Thanks for listening to today's episode, don't forget to subscribe and visit us at To learn more. I'm Andrea step Tala and this Scipio podcast. We'll see you next time.