The future of the pensions industry

Power to the members

Until recently, the three pillars of retirement funding – government pensions, corporate pensions and private savings – were separate, non-interchangeable areas and sources of business for its players. But now, a seminal change is underway:

If the decision with whom and how to do business in pensions is shifting from companies and government agencies to individuals, the comfortable “one-to-few” relationship that retirement providers had is changing to a much more demanding “one-to-many.” Instead of serving one large customer, they will have to serve many empowered consumers.

In searching for better ways to manage complexity, successful companies realize they can no longer try to be everything to everybody. . In the future, agile pension companies will focus on a few specialized units, or kernel functions, around a provider’s actual core competencies. This change can be accomplished by implementing the five imperatives of pensions:

These imperatives are not options to pick and choose from. Depending on the role a company wants to play in the future, the level of implementation can vary. But, ultimately, all five imperatives will have to be accommodated to position for success.

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