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The Challenges Of Running An Employee Discount Program

The following is a guest post from Kathy Lang. Kathy is the HR Employee Recognition Specialist for MD Anderson a leading cancer research and patient care facility in Houston, Texas.

Editor’s Note: Abenity is proud to manage the employee discount program for MD Anderson, one of the top medical facilities in the world leading the fight to beat cancer. This guest post outlines some of the challenges MD Anderson faced running their own employee discount program prior to switching to Abenity.

I work for MD Anderson Cancer Center in Houston and coordinate employee recognition and work-life programs. We have 18,000 employees as well as an active retirees association. Our goal is to be an Employer of Choice so that we can attract the best and brightest people and remain consistently at the top of the list of cancer hospitals. In order to reach that goal we need to provide our employees and their family members with a comprehensive set of programs that addresses their work-life needs.

Setting up a corporate discount program was a priority for us but also a major challenge because, as a member institution of the University of Texas System, we fall under state regulations. One of the regulations is a “no solicitation” policy. After years of consideration, the University of Texas System created a new policy that specifically stated that each member could create an employee discount program as long as it was approved by our President. Even with that permission, we still faced internal hurdles such as questions from our legal and compliance department as well as an ethics review. The UT System policy had other guidelines; one of which was that we could not hire a third party provider to coordinate our discounts program.

Without a vendor to advise us or provide examples based on their expertise, our staff had to do all the research and groundwork to get the program underway. Our legal department, which was already stretched thin with cooperative agreements and contracts, had to budget time for interpretation of the policy, and our IT department had to develop the forms and database for the vendor information from scratch.

On the marketing side, we also needed to create a memorable name for the program, which we called the iDEAL Discount and Services program. We wanted to stress that this was an online program that was available 24 hours a day. We also made sure that it resided on our internet rather than our intranet so that family members and retirees could easily check the website for the latest discounts. However, this prevents the site from seeming “exclusive” to our employees, which can damage the perception of the value of the program.

A third-party provider would have been able to write the disclaimers, research best practices with other institutions, create and maintain the website, create, as well as collect and review forms from potential vendors. More importantly, a third party vendor would be able to contact vendors to ask them for a discount. This is something, as a state institution, that we cannot do. Because we can’t solicit vendors, we rely on them to stumble upon our site which is both inefficient and impractical.

Regardless of who is in charge of the employee discount program, employees should not perceive a vendor’s inclusion in the program as an endorsement, safeguard or guarantee on the quality of the workmanship or any other consumer protection by the employer.

In this climate of tight budgets and shrinking salary merit pools an effective discount program can truly add value for our employees. Third party vendors can do this much more efficiently and quickly than in-house programs as well as minimize exposure or the perception of a conflict of interest between the employer and any contract vendors. Having said all this, we were allowed to include a third party discount vendor, Abenity, on our list of discount providers. This allows our employees to have access to major discounts while we still run the overall program as required.
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