Detail, quick innovation common winning themes

Winners of Pensions & Investments' Eddy Awards featured examples of detailed, methodical planning and execution for complex plan changes as well as quick transformations of education campaigns to adapt to a virtual reality because of the coronavirus pandemic.

Sixty-eight campaigns were recognized as part of the Defined Contribution Spring Virtual Series March 8-11,which replaced the in-person conference traditionally held in Florida.

Several awards went to sponsors that navigated the defined contribution version of herding cats as they combined, consolidated or rearranged plans to reflect mergers, new record keepers and/or updated strategies to improve participation.

Howard University, Washington, placed first in the conversions/403(b) consolidations category in the not-for-profit/other category for institutions with more than 5,000 plan participants. TIAA-CREF was the service provider.

Participants "weren't actively managing their funds," said Larry A. Callahan, the university's associate vice president and chief human resources officer, as he explained why the university cut the number of record keepers to one from five and the number of investment choices to 25 from 150.

"They were confused," he added. "We had to do a lot of simple communication."

Mr. Callahan said there are five generations among Howard University's participants including retirees. "We really needed to help retirees, active employees and everyone in every generation understand the retirement benefits," he said.

In addition to a detailed brochure containing investment information, Howard's education campaign included a resources section that showed participants where to get additional information, including online documents and both online and on-site seminars.

As a result, the share of participants making voluntary contributions rose to 64% as of June 30, 2020, vs. 51% in June 30, 2019. The percentage of participants increasing their contributions jumped to 61% vs. 13.9% during this period.

"What I liked about this entry is that they used data, focus groups and town halls to drive the need to consolidate their plan with one record keeper," one judge wrote.

The Illinois State Universities Retirement System, Champaign, and service provider Voya Financial, won first place in the conversions/403(b) consolidations category for public plans with more than 5,000 participants, thanks to an extensive revamping of its DC plan lineup. The sponsor changed record keepers — reducing the number to one from two — and it created a new default investment option emphasizing lifetime income.

"The previous requirement for our members to annuitize 100% of their account balance at a point in time was one of the primary reasons for embarking on our plan redesign project and why we sought a solution that offered more flexibility than a traditional annuity," Suzanne Mayer, interim executive director and chief benefits officer, wrote in an email.

Before the conversion, approximately 60% of defined contribution plan retirees chose a lump-sum payment instead of an annuity.

"Individuals were opting for the lump sum even though in most instances it was not financially advantageous over the long term," Ms. Mayer wrote.

The SURS Lifetime Income Strategy component is part of a customized target-date fund series that automatically adjusts as participants reach age 50, moving participants' assets into a lifetime income option. The traditional annuity option remains available.

By the end of February, Ms. Mayer reported that 86.5% of participants were fully invested in the new lifetime income strategy, 6.2% have assets in this strategy as well as in the plan's core funds, and 7.3% invest only in core funds.

"We were surprised at how open to change the majority of our membership was in this regard," she said, referring to the plan’s consolidation of record keepers.

ND Paper Inc., Oakbrook Terrace, Ill., placed first in the conversions/403(b) consolidations category for corporate plans with 1,000 to 5,000 participants. Principal Financial was the service provider.

Having become an independent company in June 2018, "we inherited a (retirement) platform that was less than adequate for our current business and where we wanted to go," said Bob Fieck, vice president of human resources.

The company also wanted to have one record keeper to cover the two defined contribution plans and one defined benefit plan. "Moving to this new platform would certainly reduce costs," Mr. Fieck said.

When the company decided to switch record keepers to Principal Financial, it wanted to make sure to "eliminate surprises, reduce anxiety and generate excitement" for the change, the company's Eddy Award application said. That meant contacting local human resources representatives to generate employee support and giving key members of the HR staff a chance to review and provide feedback on communications strategy.

Mr. Fieck said ND Paper used "every avenue available to us" — email, an internal communications board, regular mail sent to employees' homes, opportunities for employees to speak to supervisors — to make sure employees were well-informed and comfortable with the process.

As a result, the conversion was "a seamless transition with virtually zero questions and concerns," he said.

Eddy Award judges praised the multi-faceted effort. It was "very comprehensive and easy to understand," one judge wrote.

Created in 2015 via acquisition and merger, Avangrid Inc., Orange, Conn., was at one time administering 18 retirement plans with multiple record keepers and several investment menus.

The company has since chosen one record keeper, T. Rowe Price Retirement Plan Services, consolidated investment menus, and revised and consolidated plans.

Part of the process was a campaign to educate participants about the consolidation, introduce the record keeper, and build a greater "sense of community" among participants for the new plan. "To ensure that we had maximum engagement and people felt that they were part of this change, and it was a positive change, I rolled out a contest to pick the new slogan of the plan," said Paul Visconti, director of retirement programs and investments.

The campaign earned Avangrid a first place award for plan transitions among corporate plans with more than 5,000 participants.

The company developed a few choices and asked employees to pick one. The winner: "Generating a brighter retirement together." Mr. Visconti, noting the play on words because Avangrid is a utility company, said this let people "feel like they were part of the consolidation and kind of have their voices heard."

Employees who entered the name-the-plan contest were eligible for one of 10 cash gifts of $50.

When asked what people can learn from Avangrid's experience, Mr. Visconti said: "It's crucial to engage your employees in as creative a way as possible. People like to receive stuff for participating and having their voices heard. So I think there's no harm in giving some small little gifts to people to give their feedback and share their thoughts."

If necessity is the mother of invention, then the pandemic may have been the stepmother of innovation.

Making the switch to a virtual online benefits "mall" from traditional live benefits fairs earned the University of Texas at Dallas a first place special projects award for plans with 1,000 to 5,000 participants in the not for profit/other category. Lincoln Financial Group was their service provider.

"It was a fun way and a different, creative way," said Marita Yancey, senior director of benefits and wellness.

Keeping with the mall concept, the university promoted the theme: "Smart Benefits Shopping: Find it. Use it. Love it."

Not only did the university save money but it also attracted a large audience, she said. In a normal year, the university's benefits fair costs $6,000 to $9,000, she said. Last year's event cost $624. Print costs were cut by more than 75%.

Also in a normal year, 500 to 600 people attend a live event. Last year, 4,829 entered the virtual fair platform, Ms. Yancey said.

The university will offer the virtual mall this year, but Ms. Yancey hopes for a hybrid benefits event — part virtual and part live.

"I thought the messaging was clear and catchy," one judge wrote. "The idea of a virtual mall was creative and the design was very well thought out."

The stock market turmoil during the first quarter of 2020 prompted Sony Corporation of America, New York, to enhance its participant education efforts targeting communications to those who were invested solely in a stable value fund.

One email went to those under age 60 with a link to an article about staying invested during volatile markets. Another email went to people 60 and over with a link to an article about facing retirement in a down market. Each group received an invitation to attend a webinar on investing fundamentals.

"We were hearing from participants a lot of questions, a lot of anxiety," said Judy Leung, Sony's benefits manager. They were asking "what's going on with the market and what was happening to their retirement savings."

Sony reported that of those who took action based on the stable value fund emails, 72% eliminated the fund from future allocations and 89% "shifted away from the fund by at least 50%.'' More than $5 million in plan assets moved to other allocations from stable value.

Sony captured first place in the ongoing investment education category for companies with more than 5,000 plan participants. T. Rowe Price Retirement Plan Services was their service provider.

"I know sometimes it feels like it's really hard to reach out to participants," Ms. Leung said. "But sending out targeted communications to them can help bridge that gap with participants and really make them pay attention."

Financial wellness programs were growing well before the pandemic struck, and sponsors said the value of wellness services intensified as the pandemic took an economic and health-care toll.

"It became evident to us that if our employees are going to remain retirement ready, we really need to reach out to educate," said Russell DuBose, director of human resources for Phifer Inc., Tuscaloosa, Ala., first place winner for financial wellness among corporate plans with 1,000 to 5,000 participants.

Phifer tied for first-place honors with Seagate Technology LLC, Cupertino, Calif. John Hancock Retirement Plan Services was Phifer's service provider, and Segal Benz was Seagate's service provider.

"We have resources available for employees to meet their responsibilities and obligations without potentially damaging their retirement readiness," said Mr. DuBose, whose company makes window and door screens.

Phifer's wellness education effort combined in-person interviews and online technology. This included an app that contained information on retirement readiness. "The campaign was about how do we reach those different generations and meet their expectations," Mr. DuBose said.

Judges noted that Phifer's wellness approach covers more than retirement with seminars on long-term care, Medicare, Social Security, credit, budgeting and estate planning, plus a class on financial literacy at a local community college. "It's clear that Phifer is trying to do best by its employees," one judge wrote.

Asked what financial wellness strategy he would recommend to sponsors, Mr. DuBose responded: "Be creative. Be spontaneous. Have fun with it."

RELX Group won first place among corporate plans with more than 5,000 participants for the financial wellness category for encouraging plan participants to use the health savings account as an investment tool as well as a health benefit. Segal Benz was the service provider.

"We had a lot of utilization and not a lot of savings," said Christina Heintz, the New York-based manager of benefits communication and employee engagement. "We felt that it was an important time to grow savings (and) to really highlight the benefits of it as a retirement tool."

The RELX campaign included an infographic mailer, an interactive quiz about the use of an HSA, targeted emails and web-based content to reinforce the message, said the RELX application.

"The quiz is really wonderful and so effective," one Eddy award judge wrote. "It was visually appealing and well done."

Ms. Heintz added that her goal, in addition to encouraging greater savings, was to make the HSA as a retirement vehicle "seem a little fun and not like stodgy."

United Airlines won first place in the pre-retirement preparation category for union plans with more than 5,000 participants. Schwab Retirement Plan Services was the service provider.

Pilots know they must retire at 65, according to Federal Aviation Administration requirements, but because the pandemic played havoc with the airline, nearly 500 pilots accepted a buyout at age 62.

Still, it was important for the airline to prepare pilots for retirement, leading to a campaign that offered a detailed checklist.

The common theme: "Your pre-retirement checklist —a step-by-step countdown to retirement."

The information was organized in four age groups, from the almost-ready-to-retire (ages 63.5 to 65) to the still-with-many-years-left (ages 50 to 57).

The segmentation approach started last year, said Joan Smith, the Houston-based manager of benefits for retirement plans. United offers a checklist for all employees "but the pilots have special information" because they have different benefits, she explained.

Illinois Tool Works Inc., Glenview, Ill., took first place in the pre-retirement preparation category for corporate plans with more than 5,000 participants, thanks to a detailed everything-you-wanted-to-know-about-retirement booklet that also is available on the company's internet portal. ROC Group was the service provider.

The company starts sending the booklets to people when they reach age 55 – the average retirement age at the company is 60 to 62 – "to get them to start thinking,'' said Kelly Dunmore, director of U.S. retirement plans.

"This is one-stop shopping for all things retirement," she said. "We wanted to make sure the document was written in a simple way so that anyone can read it and understand it."

The booklet provides a visual timeline for what employees should do before and after retirement, and it contains information about issues such as health care, estate planning, life insurance, Medicare and Social Security.

"This was a comprehensive guide for those nearing retirement," wrote one Eddy judge, echoing other judges' comments.