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Evaluating client relationship management in pensions administration: going beyond the surface

Join Daniel Taylor as he outlines the key service indicators trustees should consider when evaluating client relationship management in pensions administration.

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Author: Daniel Taylor, Client Director
05 February 2024

Evaluating client relationship management in pensions administration: going beyond the surface

A critical yet often misunderstood aspect of pensions administration service evaluation is Client Relationship Management (CRM). Having taken part in numerous provider reviews throughout my career, this facet of service provision is frequently perceived as amorphous and subjective. Very often, I see a decision being made on the basis of how much the selection team like or connect on a very personal level with the proposed client manager. However, this approach and perception undermines the potential for a more structured and objective analysis of CRM quality. Whilst personal relationships are important and shouldn’t be ignored, I find there are many key service indicators that should also be considered when evaluating a CRM, moving beyond mere personal rapport.

Client density: a measure of attention

A fundamental metric to consider is client density, which refers to the number of clients a manager is responsible for. While there’s no universal optimum number due to varying client sizes and demands, a threshold exists. Typically, managing more than 10-12 clients could be indicative of an inability to provide an effective and focused service. This number serves as a guideline to gauge the potential for personalised attention and bespoke service delivery.

Experience: breadth and depth matter

Experience in CRM is twofold: personal experience and the diversity of the client portfolio. A client manager with a varied portfolio can bring a wealth of insights and lessons learnt from different pension schemes. Conversely, a manager handling too few clients may lack this broad perspective, potentially impacting service quality.

Reporting lines and business influence

The organisational structure and the client manager’s position within it are crucial. This includes their capacity to influence business priorities and development targets. The reporting lines to senior business leaders and their authority in directing services are indicative of their ability to effectively advocate for and address client needs.

Tools: the undervalued asset

Tools and systems utilised by client managers are often overlooked but are essential for efficient service delivery. These tools should encompass a range of functions, from monitoring and reporting on service delivery and satisfaction levels to managing scheme events and client activities. An evaluation of these tools offers insight into the sophistication and maturity of the account management approach. In my experience, this is an area that, at worst, is totally ignored or, at best, rarely explored as part of an evaluation process. It’s commonplace to never even be asked the most basic of questions such as ‘do you have a client relationship management system and what is the system you use?’

Client satisfaction: an essential metric

While member satisfaction indices are common in provider reviews, an equally critical but often overlooked aspect is client satisfaction. A high-quality pensions administration operation should have robust programmes and structures in place for collecting and analysing feedback from clients, such as Trustees and Pension Managers. This feedback is invaluable for assessing the performance and efficacy of the client manager.

An effective client satisfaction programme should not be an ad hoc or rudimentary system. Instead, it needs to be grounded in a firm, independent framework of analysis. For instance, our  partnership with Investors in Customers (IIC) serves as an exemplary model. Such partnerships ensure that the feedback mechanisms are credible, unbiased, and aligned with best practices in client relationship management.

The focus on client satisfaction metrics specific to client managers can reveal insightful nuances in their service delivery. It allows for a detailed understanding of their strengths and areas for improvement from the perspective of those they serve. This level of analysis ensures that the service provided is not only meeting but exceeding the expectations of the clients.

In summary, while a personal connection with a client manager is important, it should not be the sole criterion for assessing their effectiveness in CRM.

Including metrics such as client density, experience, reporting structures, and the tools at their disposal provides a more comprehensive and objective framework for evaluating CRM in pensions administration. By focusing on these aspects, decision-makers can make more informed choices, ensuring that their pension scheme is in capable and attentive hands.

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