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Products August 3, 2017
Wells Fargo Tool Offers Cross-Industry Plan Benchmarking
The motivation for creating the Outcome Optimizer was born
out of the understanding that plan sponsors and business owners are competitive
by nature and, for the most part, they want to offer top quality benefits that
reward hardworking employees.
Reported by John Manganaro
Wells Fargo Institutional Retirement and Trust has released a new Outcome Optimizer that grants sponsors a greater ability to benchmark key plan health indicators against peers, based on industry, size or geography.
Mel Hooker, director of relationship management for Wells Fargo Institutional Retirement and Trust, says she is particularly proud of the latest solution rolled out by the firm, the Outcome Optimizer.
The solution provides benchmarking to help plan sponsors and company leaders as they consider plan design changes that “aim to bring out desired outcomes for their employees enrolled in the plan.”
Accessed via a direct link on the Wells Fargo Institutional Retirement and Trust plan sponsor landing page, the tool helps sponsors stack up their participation rates, contribution rates, account diversification, average participant balance, and the percentage of participants on track for an 80% income replacement in retirement.
“The interactive aspect of the tool lets sponsors compare different scenarios to help visualize a plan’s progress toward their own goals and toward the benchmarked plan, taking advantage of historical plan information available in different demographic segments,” Hooker tells PLANSPONSOR. “Using data to drive decisionmaking is an effective way for plan sponsors to make a positive impact on their plans.”
Hooker further explains the motivation for creating the optimizer was born out of the understanding that plan sponsors and business owners are competitive by nature and, for the most part, they want to offer top quality benefits that reward hardworking employees. It is not only an ethically commendable thing to do—it is increasingly necessary to offer generous benefits to attract top talent in a more competitive labor market. Simply put, the labor market stands near what has historically been considered full employment, implying that job seekers can be more demanding.
Indeed, the data underlying the tool, according to Hooker, shows a pretty wide dispersion among the quality of plan offerings across the U.S., to some extent by region but more predominantly by the employer size and industry. Crucial for a plan sponsor to realize is that, even if the plan is generous compared to other industries—for example banks tend to have more generous plans than retail business or chain restaurants—it is far more informative for recruiting purposes to compare a given plan with those run by similar companies in the same region.