Maliz Beams learned early in life the value and philosophy of saving for the long term, an education that has served her well as CEO of ING U.S. Retirement Solutions, Windsor, Conn.
“We had a New England work ethic,” said Ms. Beams, who grew up in Milton, Mass., just south of Boston. “My father brought a sort of Scottish practicality and my mother brought a kind of Midwestern steadfastness. They both really focused on education and they both really focused on savings.”
Ms. Beams recalled comparing passbook savings books with her siblings. “As kids, savings wasn't intimidating,” she said. “It was kind of a family sport — who would save the most. ... My parents made it fun. They made it entertaining. They made it a way of life.”
Ms. Beams credits this early experience in helping prepare for a career in financial services, including executive vice president of individual and institutional client services at TIAA-CREF, New York, the job she held before joining ING U.S.
“That really did support where I am right now, focusing on getting peoples' retirement savings in order,” she said. “Decades later, I am parlaying that same philosophy around acting now with the future in mind.”
Among record keepers, ING was the fifth largest when measured by assets, third when measured by number of participants and second in number of plan sponsor clients, according to Pensions & Investments' 2012 survey. It's a far-flung empire that provides retirement services for Fortune 500 companies as well as for firms with as few as 20 people, Ms. Beams noted.
ING U.S. was spun off from ING Group in an initial public offering in May. It will be renamed Voya Financial next year.
How do you provide services to both very large and very small clients? ING U.S. is one of the few that does that. Looking from the outside, I realize that 15 years ago, that was good but not necessarily a competitive advantage. But given the changing of the retirement industry, there's a couple of things that are going on with institutions. ... There is a need to simplify. There is a need to standardize fiduciary standards and governance and transparency. I think the institutions feel that way; I think Washington feels that way. So being in a situation where we are major leaders in all of that is very beneficial. ... We're not going to be in banking, ... investment banking, ... commercial banking. We are going to be singularly in the business of retirement. Our ability to go across sectors, whether that's with an employer that has 100 employees or employer that has 60,000, is a strategic imperative for us.
Given your range of clients, how do you defend and expand your turf? The first thing is having a leadership position. ... You need to have standalone strong competencies in each one of those markets because they do vary a bit. Over the last 20 years, ING bought Aetna Financial Services (in 2000), which was very strong in the small and mid(size) markets. Then ING bought Citi-Street (in 2008) with its strong technology capabilities. ... We are seeing a convergence and real need to understand various business models so institutions can install a model that's more customized to what they are going to need over the next 10 years than it was over the past 20 years.
What changes have you made? We evolved from being very volume-focused to being value-focused. It was a very fundamental shift. In each of our businesses, there was a strong focus on being No. 1 in terms of volume, new volume and No. 1 in terms of (market) share. ... We have moved away from that. (It is) no longer volume but value and sustainable value and differentiated value. We developed metrics and indicators of success that united the whole company — not only retirement solutions. ... It's very important what we deliver is differentiated value. ... We will walk away (from a potential client) if it's going to be a price warfare.
We had strong businesses with strong leadership positions in each of their markets but not necessarily with a common strategy (or) a common focus. ... When I came in two years ago, my first priority was to say, “Given where the retirement system is going over the next 10 to 15 years, what is our core competence? And what is the competitive advantage we can bring to this market on a sustainable basis?” It was looking at the clients — looking at 48,000 institutions of various shapes and sizes — and talking to them about what they envision over the next 10 to 15 years. Based on that, we restructured the organization. We kept this specialty knowledge of the client, but overlaid a common strategy, a common focus on ensuring that our institutional clients have the fiduciary and the technology and the administrative capabilities that they need. Also, all of these clients have one commonality: They want all their employees to be retirement ready.
Where are participants least ready for retirement? Customers and participants are saying, “It's nice to know I have my savings, but that doesn't answer my questions about can I retire. I need the whole picture.” ... What most individuals are saying is that they are not prepared — or they are not feeling prepared. ... Certainly there's the issue of saving enough, but it is compounded by ... the aging demographics (and) the concern of the fraying of the social safety nets — the DB plan, health care and social security. ... What individuals are asking for now that they didn't before is, “I want to have a holistic picture. I need to know am I saving enough, can I retire, when can I retire and how do I make sure I don't outlive my savings.”
How can retirement education be improved? Why I think the industry has not been effective is the silver-bullet syndrome — one size fits all. That isn't the case. There needs to be a kind of financial checkup; the institutions want it. But there needs to be sophistication around doing that, then customizing the outcome to the individual. To get more effective as an industry, we need more customized approach, particularly to the middle market.
How do you create an education campaign that produces tangible results? We have not as been as effective as an industry that we should be. There's lots of activity but very little outcomes. ... With retirement readiness, as we sit down with institutional clients, the focus is to approach this from an outcome standpoint, to be able to come back to institutions and say, for example, “Your employees are 40% more ready for retirement than not only the average U.S. person but also other employees in your (peer group) sector.”
Not all people are created equal. We have segmented every institution based on; what is the participant's age; where are they in their lifecycle; where are they in the complexity of their retirement readiness knowledge. You could say there's a young person who is highly sophisticated, and there is a young person who isn't. (Or), there's a retiree who would want to do all of his or her own things; then there is a retiree (who says) "I don't know anything'. The first thing is to segment the institution. n