PLANSPONSOR - December 2018/January 2019 - 28

2018 Defined Contribution Survey: Recordkeepers
Satisfaction with basic plan administration
functions was also comparatively
high-not surprising given how administrative
mistakes likely incentivize plans
to change providers, and newly satisfied
sponsors are often those who respond.
The first signs of differentiation
emerged in the areas of technology and
participant education; each was commonly
cited for needing service improvement.
Specifically, respondents saw many opportunities
for providers to improve participant
mobile apps/offerings as well as
plan sponsor technologies and tools used
for plan reporting and plan analytics/
benchmarking. Disappointment was also
found with education programs, which
continued a long history of being among
the lowest-rated services in the survey.
At a macro level, such findings can
partially explain variances in client satisfaction
across providers, but they have
more limited value in explaining variance
among one provider's clients. Yes, sponsors
can encounter issues such as frequent
mistakes or unresponsive account teams,
which can immediately and lastingly affect
satisfaction, but recordkeepers also may
confront challenges-sometimes hidden.
For example, satisfaction scores generally
decline with plan size, suggesting that
sponsor expectations remain high even as
recordkeepers struggle to accommodate
increasingly complex plans and higher
transaction volumes.
Similarly, satisfaction is lowest in
the first year after conversion but steadily
increases with length of relationship. This
trend is notable in that it likely accounts
for the fact that sponsors, when happy, are
less apt to switch providers while unhappy
sponsors are less apt to stick around.
While many of these findings are
consistent with prior editions of the DC
Survey, sponsor expectations continue
to evolve, often faster than recordkeepers
anticipate. One area to monitor is information
security. This was the first time
sponsors cited it among their provider's
strengths or limitations. Plan sponsors can
assess satisfaction with that and with more
traditional service offerings via our " Best
in Class " provider tables. -Brian O'Keefe
Methodology
THE following pages summarize plan sponsor satisfaction with defined contribution
(DC) recordkeeper offerings in 23 areas of participant and sponsor services covering five
broad categories: technology, education, plan administration, fees and investments, and
account/client service teams. Results were compiled from the 2018 PLANSPONSOR
Defined Contribution Survey, which distributed approximately 40,000 questionnaires
to DC plan sponsors listed in the PLANSPONSOR magazine database, as well
as to client lists supplied by DC recordkeepers. A total of 3,126 usable responses were
received by the close of the survey this past November 28.
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 28 for details). A total of 23
providers qualified for listing in at least one market; details on these and other providers
can be found in our 2018 Recordkeeping Survey, available at www.plansponsor.com.
Best in Class Awards are based on sponsor satisfaction within a given area of
service. Ratings were derived from the percentage of respondents " completely satisfied "
less those that were " dissatisfied " -i.e., on a 10-point scale, awarding 9s and 10s vs. 6 or
below, respectively. 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
in Class honors but exhibited strong client satisfaction within a service attribute-i.e.,
more than 67% of clients were " completely satisfied " with the service offering.
Results also include the percentage of completely satisfied ratings received across
all categories in each major area of service and the provider's Net Promoter ScoreSM
(see below). For more information, email brian.okeefe@strategic-i.com.
Why Use Net Promoter Score®
Measure Client Satisfaction?
(NPS)* to
THE measurement and reporting of client satisfaction is somewhat of an art, with
researchers choosing from a pallet of measurement scales and reporting frameworks to
paint a picture of client sentiment, and our annual DC Survey represents a canvas on
which we report plan sponsor satisfaction with recordkeeper products and services.
This year, PLANSPONSOR migrated its measurement of " recommendation likelihood "
and service satisfaction to Satmetrix Systems' Net Promoter System, adopting its
11-point scale-i.e., 0 through 10-to replace our 7-point scale. Because of its correlation
with positive business outcomes-i.e., client retention, long-term growth, etc.-NPS has
become somewhat of an industry standard for benchmarking customer loyalty, and its
measurement framework was viewed as an improvement over our historical measures.
NPS is calculated by subtracting the percentage of customers who are " detractors " -
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. For additional information,
please visit www.netpromotersystem.com.
Overall, the Net Promoter System has its own collection of promoters and detractors,
but such debate overlooks the fact that the exact measure is less important than consistency
of measurement throughout the process.
*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.
26 PLANSPONSOR.com December 2018-January 2019

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PLANSPONSOR - December 2018/January 2019

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