Available Funds Information By Phone example essay topic

NY LIFE Concept Development Assignment Team 15 Summary 1. Does NYL want to enter into the DC market? Definitely yes! DCs are the fastest growing type of pension fund; NYL can't afford to miss this opportunity!

2. What type of service (s) should NYL provide? When entering an existing market, one has to be able to compete with the existing competition; in this case the major competitors are offering total service packages. Also, according to several surveys, an important concern, for both sponsors and participants, in selecting pension plan providers is good record keeping / administrative services. These factors necessitate NYL offer a full service DC plan. Here are some specific suggestions for services NYL should offer: .

In-house record keeping with possible strategic alliances with major payroll processing service provider (s) to obtain payroll / contribution information automatically with no extra effort by the employer... Monthly, quarterly, semi-annually or annually statements (participants option)... Basic information on the first page, detailed information on subsequent pages... Toll free phone access for daily balance and other updates (and access to they same information over the internet in the future). Automatic reallocation for those without the inclination to personally manage fund allocation. More details are found in Attachment Two of this report.

3. Major advantages from this recommended concept... Continued relationship building with existing customers. Reputation building to attract future customers. Complete control over the program allowing increased flexibility to meet both existing and future customer needs (both companies and individuals).

These advantages will allow NYL to be a complete financial need provider for customers: insurance, assortment of retirement funds, and financial planning advice. 4. Other possibilities Contracting the record keeping services to another company requires NYL to rely on someone else being responsive to customer needs (problems will reflect poorly on NYL). Although many reputable record keeping companies exist that would probably be responsive enough, they would also charge more for that flexibility, reducing NYL's profit margin. But the key concern is that this option does not build a lasting close relationship with customers. Having its own in-house record keeping requires a relatively large initial investment and ability to keep up with the technology, however it will pay off in the long run since DC plans are expected to expand and dominate the pension market in the future.

5. What to do next NYL should move forward with the recommendations, first offering this service to existing customers only. After establishing a good reputation, and applying lessons learned, expand the customer base by offering this service to the public. Throughout, NYL should monitor customer satisfaction by way of surveys and comments, and adjust the plan accordingly.

Attachment One: First attempt to crate a concept statement Form. Quarterly issued statements - showing breakdown of monthly contribution amount + gain / loss statement by fund... History of their contribution and investment shown by a bar graph (It would be also nice if the employee can also see the recent trends on all the funds available, in addition to the ones they had chosen originally, so that they can change how they allocate the money easily and on a timely manner. ). The same information should be available on the internet reflecting the most recent information available / possible (if not updated daily) Technology. Quarterly printed statements.

(Internet). Current total amount should be accessed by phone. Market / available funds information by phone and fax. As for the employer, easy interface to the payroll information, either by disk, tape or even directly transfer between the payroll processing company and 401 K record keeping company so that all the employer has to do is to receive the summery of monthly contribution, without having to actually work on the numbers. Function / benefits. Anytime access to the most up-to-date contribution information.

Easy process to change the allocation of the contribution. Easy handling by employers Attachment Two: Revised concept statement Form (refer to report example on the next page). Statements issued as often as the customer would like to receive them. Options include Monthly, Quarterly, Semi-annually, Annually... Basic information summarized on the first page, detailed information on subsequent pages. Total to date figures...

Breakdown of investment allocation given in numeric and graph form... Performance and indexing of all available funds not just one currently used by employee. Technology. Printed reports as often as monthly. Toll free phone access. Eventually (as the 1990's approach) online access and reports sent via email.

Strategic alliances with major payroll service providers to obtain payroll information automatically with almost no extra effort by the employer. If no payroll service is used, our IT people will work with the client to develop data gathering programs to facilitate payroll data collection... For those just starting out, riskier investments with higher returns. As retirement approaches, more funds are automatically transferred to safer vehicles. Function / Benefits. Ease of use.

After the plan is set up, most operations take place automatically... Employees choose the level of information they want. They can choose how often to receive a report. The report format allows people who only want to know how much they have to get that information without sorting through a complicated form but gives details for those that want them... Immediate access to information or services through toll free phone call or eventually online services. Company Name NYL 401 K Employee Name Plan ID # Basic Information: Plan Contributions This Quarter Year to Date Total to Date Employee Contribution Employer Contribution Gain / Loss Total as of (mm / dd /yy) Current Options Chosen by Employee: Percentage of income withheld xx% Automatic reallocation Yes / No Frequency of reports Monthly / Quarterly / Semi-annually / Annually Automated information: 1- (800) - Online information: web Company Name NYL 401 K Employee Name Plan ID # Detailed Information: Investment Breakdown % of portfolio Q 1 performance Last year 3-year NYL Index NYL Index NYL Index GIC 15% Money Market Bond fund Small Cap fund 30% Large Cap fund Tech fund Agg r Growth fund 30% Index fund Company stock 25% - See page 3 for list of indexes Automated information: 1- (800) - Online information: web Attachment Three: Summary of Depth Interviews As a summary of the 20 total interviews conducted by Team 15, the three depth interviews and 2 pre-test interviews described here are representative of General Motors employees.

Of the 20 interviews conducted by Team 14, these seemed to be most representative of those who were interviewed. The GM plan is provided through Fidelity Investments. Fidelity provides an extremely useful website where employees can access their accounts 24 hours a day. (NYL would not have had access to this technology in the mid to late eighties.) Fidelity also supports a 1-800 number where similar information can be retrieved.

Funds can be swapped and contributions can be adjusted by both the web site and the telephone. GM offers a lesser pension plan, but it is not popular among salaried employees. Rather, the 401 k program receives great praise among GM employees. 3 In-Depth Interviews Interview #1 Interview #2 Interview #3 Depth Interviews What problems do you face with your present pension plan? Doesn't really understand it. A lot of terms subject is unfamiliar with.

Happy with plan. Good plan. Are you happy with the reporting of your plan? Yes... seems well organized, but needs more simple explanations. Very happy.

A bit lengthy, but good. Useful information provided? Some parts are useful Good info. Yes. Is a quarterly report satisfactory to your timing needs?

Quarterly is good for the paper report. The account can be accessed 24 hours a day by either the internet of the 1-800 number. Yes. Doesn't really look at the paper report much... uses the online reporting and the 1-800 reporting more than anything else. How can the report you receive be improved? One particular item is that each investment should be reported in shares and not in units... this is confusing.

Projections would be nice. Assuming current contribution rate and return rates on investments, what does my plan look like in 30 years? I would like to see a total ROI since the day of inception into the plan. This value is calculated quarter by quarter, but not as a whole. 2 Pre-Test Interviews Interview #1 Interview #2 Pre-Test Interviews What does this report do?

Reports on and projects my earnings. Summarizes my retirement account. Why should you use it? To see how my retirement fund is doing. To tell me how much I might have when I retire. When is it helpful to you?

I like 24/7 access to my reports. All the time. How does it work? Quarterly paper reports, 1-800 access. Paper reports.

Access numbers. What must I do to make it work for you? Have it explain to me how I should adjust my investment selections to become more profitable. Personalize the statement to have it show me only the things I want to see. Are you willing to change what you now do to use this report? Maybe.

Probably not. What do you like? It seems simpler than my present report. Format is good. What could be improved to make it even better? Provide more projections.

Personalize it. Rank your likelihood of using this report. 4 3.