PLANSPONSOR - December/January 2021 - Cover3

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2020 PLANSPONSOR BEST IN CLASS DC PROVIDERS
for them because the " surviving " recordkeeper
is the one most invested in technology
and cybersecurity. Plan sponsors
can partner with their adviser to hold the
new recordkeeper accountable for pricing
consistent with service quality.
Typically, when recordkeepers
2020 PLANSPONSOR BEST IN CLASS DC PROVIDERS
consolidate, they are trying to maintain
the best of both companies, says Credico.
For the clients of an acquired company,
there will be change. " Plan sponsor
clients of the acquired recordkeeper need
to do their due diligence on the new
recordkeeper and need to be OK with the
changes, " she says. " The fiduciary duty
of selecting providers means do your due
diligence, and don't just go along with the
change. "
With an acquisition, the acquiring
2019 PLANSPONSOR DC BEST IN CLASS AWARDS
Best in Class Award
Service Commendation l Received too few ratings in category and was thus ineligible for recognition
Participant
Services
Sponsor
Services
Service Teams /
Support
Plan
Administration
Investment
Fees
company will usually maintain plan sponsors'
contracts until they run out, she
says. " But it's important to benchmark
fees, which may go up or down after that. "
METHODOLOGY
PROVIDER INDUSTRY SNA
THE 2020 DEFINED CONTRIBUTION (DC) SURVEY summarizes plan sponsor satisfaction
with DC recordkeeper offerings in 23 areas of service covering five broad categories:
Participant Services; Sponsor Services; Service Teams and Support; Plan
Administration; and Investments and Fees. Responses were gathered via an online
questionnaire distributed to approximately 20,000 DC plan sponsors sourced from
prior surveys and PLANSPONSOR's subscription database; it was also sent to client
lists supplied by DC recordkeepers. A total of 2,343 usable responses were received by
the close of the survey late this past November.
To qualify for inclusion in the published results, a provider had to meet quotas in
each of six asset-based Markets; see charts starting on page TK for details. A total of 17
providers qualified for listing in at least one market. More information on the markets
serviced by these providers and others can be found on page TK, as well as in our
2020 Recordkeeping Survey, available at plansponsor.com/research; free registration
is required.
Best in Class Awards are based on sponsor satisfaction within a given area of
2019 PLANSPONSOR DC BEST IN CLASS AWARDS
service. Ratings were derived from the percentage of respondents " completely satisfied "
(9 or 10 on a 10-point scale) less those that were " dissatisfied " (6 or less). The three
highest-scoring providers in each service category earned a Best in Class Award, as did
those providers with a net satisfaction rate above the asset group's benchmark score,
also listed in each chart.
Service Commendations were given to recordkeepers that did not receive Best
How to Differentiate
As the pool of recordkeepers gets smaller,
plan sponsors might have a harder time
differentiating between them and not
know which considerations matter most.
" Plan sponsors should also want a
Best in Class Award
in Class honors but exhibited strong client satisfaction within a service attribute-i.e.,
more than 70% of clients were " completely satisfied " with the service offering.
Results are presented by market to reflect differences in the competitive landscape.
Service Commendation l Received to few ratings in category and was thus ineligible fo recognition
Leader boards are used to show the highest scoring providers in certain areas. Expanded
listings are available online. For more information, email surveys@issmediasolutions.
com.
Participant
Services
provider that keeps their plan up with the
times, " Credico says. " It doesn't have to be
the leader but should bring plan sponsors
new ideas and [keep them up on] trends. "
Sponsors also should seek a team
RESEARCH | 2019 PLANSPONSOR BEST IN CLASS DC PROVIDERS
Micro: Plan Assets <$5mm (Minimum of XX responses; Best in Class benchmark of XX%)
Ascensus
Correll Co.
l l
CUNA Mutual
Empower Retirement
John Hancock
Newport
OneAmerica
Principal
Securian
l
l
l
l
SHINING
that will focus on their needs and offer
them solutions. " They'll want to look for
a recordkeeper that does a fair amount of
business with plans like theirs and of the
same size, " Credico says.
Investment in technology is a differentiator
for recordkeepers, Credico says.
" More participants tend to go to the
internet for services, so recordkeepers
should be improving websites and
making them user-friendly, " she says.
In addition, she notes, there is a big
l l
l
The Standard
T. Rowe Price
Voya
Small Market - A: Plan Assets $5mm - $25mm (Minimum of 20 responses; Best in Class benchmark of 60%)
Ascensus
AIG Retirement
Charles Schwab
CUNA Mutual
Empower Retirement
John Hancock
Newport
OneAmerica
EXAMPLES
market for financial wellness solutions,
and products integrated with technology
are important. " Student loan benefits,
managed accounts and advice that incorporates
participants' total financial
l l
18 PLANSPONSOR.COM December 2020 - January 2021
PSDJ21_BIC DC Providers_p1.indd 18-19
l
OneAmerica
The Standard
l l
l
In a year darkened by COVID-19,
our 2020 Defined Contribution (DC) Survey
puts a spotlight on providers with exceptional service.
l
W
20 PLANSPONSOR.COM December 2020 - January 2021
PSDJ21_BIC DC Providers_p1.indd 20-21
hen plan sponsors reflect on their plan's success in 2020, the effects of COVID-19 and how it has
affected their organization is likely top of mind. The 2020 PLANSPONSOR Best in Class is culled from
the results of our 2020 Defined Contribution (DC) Survey, fielded in October, and offers insights into
Charles Schwab
Empower Retirement
John Hancock
the relationships between plan sponsors and their recordkeepers, during this difficult year.
As we have found in other recent surveys, recordkeeping fees continue to be compressed. But the companies
must remain competitive in the areas of technology and other specialized services, therefore costs are up and
revenues down, says Robyn Credico, defined contribution consulting leader, North America, at Willis Towers
Watson in Arlington, Virginia. Another reason revenue is falling for recordkeepers is that fewer sponsors
now opt for bundled recordkeeping solutions. This means opportunities for leveraging new business from
current clients have decreased, she says. Even up against these challenges, she says, " recordkeepers work
hard to differentiate themselves in different markets. "
Pamela A. Popp, president of Lockton Retirement Services, in Kansas City, Missouri, says the fundamental
recordkeeping function-what she calls " the basic block and tackle " -is now often referred
to as a " commodity. " Whereas pricing has been driven down for those basic functions, the value-add
services-what recordkeepers need to differentiate themselves these days-require significant investment,
she says. " Recordkeepers consolidate for scale and growth. "
Is Consolidation a Good Thing?
As shown in the annual PLANSPONSOR Recordkeeping Survey, consolidation of the industry
continues. While it may be a little unsettling for plan sponsors and participants whose recordkeepers
are merged with or acquired by others, Popp says she believes consolidation is better
l
Hernández
PLANSPONSOR.COM December 2020 - January 2021 17
12/16/20 1:55 PM
Net Promoter Score® (NPS)*
FOR THE PAST THREE YEARS, PLANSPONSOR has used a modified version of Satmetrix
Systems' Net Promoter System (NPS®) to measure sponsor satisfaction. Based on a
single question-on a scale of 0 to 10, how likely are you to recommend a company to
a friend or colleague?-NPS provides a single-metric snapshot of customer loyalty and
has been shown to have strong correlation with positive business outcomes such as
client retention and long-term growth. Because of these factors, NPS has become something
of an industry standard for measure and reporting client satisfaction.
NPS is calculated by subtracting the percentage of customers who are " detracSmall
Market - A: Plan Assets $5mm - $25mm (continued)
Principal
Securian
The Standard
T. Rowe Price
Transamerica
Voya
Small Market - B: Plan Assets >$25mm - $50mm (Minimum of 20 responses; Best in Class benchmark of 60%)
AIG Retirement
Ascensus
Charles Schwab
Empower Retirement
Newport
tors, " giving a score of 6 or less, from the percentage who are " promoters, " giving a 9
or 10. The thinking is that this measure gives equal importance to clients who love a
company's product or services as it does to those who are less happy-and possibly at
risk of leaving for a competitor that offers something better. " Passives " -7s and 8s-are
thought to be only somewhat satisfied and do not influence the final score. Forrester
Research Inc. published its 2020 Net Promoter Benchmark report this past November
and found that the top Net Promoter Score across 250 brands, representing 14 industries,
was 59%, which roughly corresponds to the Best in Class benchmark used in the
DC Survey. For additional information, please visit netpromotersystem.com.
*Net Promoter, Net Promoter System, Net Promoter Score, NPS and the NPS-related emoticons
are registered trademarks of Bain & Company, Inc., Fred Reichheld and Satmetrix Systems, Inc.
l
l
Transamerica
Voya
Midsize Market: Plan Assets >$50mm - $200mm (Minimum of 20 responses; Best in Class benchmark of 60%)
Ascensus
l
Sponsor
Services
Service Teams /
Support
Plan
Administration
Investment
Fees
Nearly all (96%) of sponsors
are at least somewhat likely
to recommend their provider
Likelihood of Recommending
Recordkeeper to a Friend or Colleague
Somewhat
likely
18%
Less
likely
4%
Averag
Participa
Enrollm
Print/d
Pre-r
In-p
O
O
Extremely
likely
78%
Longer provider relationships,
and smaller plans (see
bottom chart), have
greater satisfaction
Average Net Satisfaction by Tenure
With DC Plan Recordkeeper
74% 76%
62%
66%
S
Net Recommendation Rate
By Total DC Plan Assets
84%
75% 79%
66%
l
Enrollment materials / support
Print / digital campaigns
Pre-retiree support
In-person participant support
Online retirement planning tools
Online financial wellness offerings
Plan management
Plan analytics / benchmarking
Plan reporting
Plan / industry knowledge
Responsiveness / consistency
Regulatory updates
Compliance support
Transaction processing
Beneficiary administration
Loan and withdrawal processing
Plan design flexibility
Payroll integration
Cyber-security policies
Traditional Investment Options
Custom Investment Options
Retirement Income Solutions
" Cost to value " of plan fees
Enrollment materials / support
Print / digital campaigns
Pre-retiree support
In-person participant support
Online retirement planning tools
Online financial wellness offerings
Plan management
Plan analytics / benchmarking
Plan reporting
Plan / industry knowledge
Responsiveness / consistency
Regulatory updates
Compliance support
Transaction processing
Beneficiary administration
Loan and withdrawal processing
Plan design flexibility
Payroll integration
Cyber-security policies
Traditional Investment Options
Custom Investment Options
Retirement Income Solutions
" Cost to value " of plan fees
<$5mm
$5mm - $25mm
1 year - 3 years
>$25mm - $50mm
$200mm
>3 years - 5 years
<1 year

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PLANSPONSOR - December/January 2021

Table of Contents for the Digital Edition of PLANSPONSOR - December/January 2021