What Gets Measured, Gets Done
Empowerment, empathy and effectiveness—three “E” words that were immediately apparent when speaking with Kathleen Kelly.
Kelly, Managing Partner of North Carolina-based Compass Financial Partners, takes a strategic approach to developing education and communication programs with clients, the goal of which is to empower employees to make the right decision.
“When you compare the spend that most organizations make on a 401k plan, whether it’s through the match and/or recordkeeping and administration fees, compared to their health insurance benefits, it’s generally just a drop in the bucket,” she explains. “We believe the 401k plan should be the ‘front porch’ of a benefits program because it helps employees achieve a sense of security, not only currently, but for their retirement.”
Unfortunately, an employer doesn’t always see it that way, yet offering a 401k generates a tremendous amount of goodwill for the organization—employees feel like the company is doing something for their best interest moving forward.
“The retirement plan really helps to lead participants to a sense of empowerment,” she reiterates.
The Compass process begins with an employee survey to gain information about the areas that employees would like to learn about.
“It’s often significantly beyond just the scope of the retirement plan itself; around budgeting, debt management, student loans, estate planning and investment information,” Kelly adds. “It takes the form of feedback and then allows our client to craft a plan that is meaningful and relevant to the employees, so they feel like their voices are heard.”
They also evaluate the plan by gauging whether it’s achieving what the plan sponsor has set out to do.
“We have a client that is a consumer products manufacturer,” she says by way of example. “They have very generous benefits and had a participation rate that was 78.6%—right at the industry average.”
The firm worked with the client, benchmarked the data and looked at the amount of money that employees were leaving on the table with the match.
“We were able to build a story and support it around changing plan design, and why it might be advantageous. Why should the plan sponsor perhaps consider increasing their spend on the retirement plan? What would the result really look like? How do we build a case to support that and provide the right information to participants to make an informed decision?”
The result?
By making plan design changes coupled with a communication campaign, the participation rate increased to 95% and has remained at that level since.
Financial wellness is, of course, a big part of what they do, something that means different things to different people. For that reason, the firm offers its own solution but has also partnered with several financial wellness vendors.
One more thing Kelly emphasizes in describing employee education and the participant experience is that “what gets measured, gets done.”
“We are very tight on our analytics,” she concludes. “I asked Cindy Patterson, our Director of Financial Wellness, for statistics about what we’ve done so far this year. She said our teams have held 135 group meetings with 47 days of individual meetings and interacted with 3,632 individuals in eight states, and that’s just through May.”
Kathleen Kelly is Managing Partner with Greensboro, North Carolina-based Compass Financial Partners.