Case Study

Pension Administration Process Review

A large, international airline had outsourced administration of pension plans for its 30,000 employees to a third-party administrator. The plan sponsor wanted to review how retirement benefits were being processed, particularly for special groups of employees and higher-risk calculations that could not be fully automated. The plan sponsor’s goal was to document and test the processes, minimize any risks or gaps and identify opportunities for improvement.

SBA first met with the plan sponsor to identify which processes related to the retirement event should be reviewed. SBA conducted on-site and phone interviews with key members of the client’s pension administration team and collected documents, spreadsheets and individual test-case information related to each process. SBA then reviewed and documented the processes and identified potential opportunities to reduce risk or improve efficiency. SBA presented its draft findings to the plan sponsor, then finalized the review based on the client’s initial feedback and questions.

SBA presented an executive summary of its findings to the plan sponsor and its administrator. Each process was documented, and observations and potential opportunities were identified. SBA made recommendations for which actions should be prioritized based on the client’s objectives. The plan administrator was very receptive to the review process and agreed to partner with the plan sponsor to implement recommended changes. Having processes documented and reviewed by an independent party gave the plan sponsor confidence that the project would reduce the risk of errors, enhance the retirement experience for employees and improve the services provided by its administrator.