Change Starts Early

We were recently interviewed by an organization looking for an investment consultant to help make big changes to their retirement benefit program.  These changes weren’t reductions in benefits to employees but instead changes to retirement plan providers and investments that hadn’t been touched in over a decade.

It is commonly accepted that any change (even positive) can be disruptive and while changes to the plan may lead to long-term improvements in the performance of the plan and its participants, worry about communication with participants has made change, even positive change, a difficult to attain objective.

In our 16 years as a firm, we have had the opportunity to work alongside dozens of clients making similar changes.  And so, the question came, “how do you support committees and participants in helping them understand and accept change?”

The good news for committees concerned with change and change management is that the approaches you use to communicate a change in providers is the same as communicating changes to your organizational strategy.  And while one is clearly more important than the other, the fundamentals are the same and are manageable.

  1. Build Credibility – Committees looking to make changes need to be visible and credible to the population. The first time a participant hears about your retirement committee should not be when you move their cheese.

  2. Solicit Input – You may know what changes are required to your plan but invest time in ensuring others understand the direction. This will be critical in helping make change palatable.

  3. Make Sure Your Process is Bulletproof – As is true in all things fiduciary, process is critical, but never more so than when you make change. People can disagree with the decision but they should have comfort in the process and its participants.

  4. Plan Broad Communication in Advance – Agreeing on a communication strategy can take weeks. The time between deciding on a change and making an announcement of any change is a risky time.  Keep that time short.

  5. Execute – You’re asking participants to change. Make sure the change goes smoothly.  Details and outliers are important.  Smooth transitions will be accepted more readily and will reinforce the credibility of the committee and its processes.

  6. Follow-Up – So now that life is smooth again, the desire is to never mention the change at all. Why pick at the scab?  Assuming the benefits of the change are materializing, following up with communication to the users is important.  Follow-up will build credibility for your next big change.

Multnomah Group is a registered investment adviser, registered with the Securities and Exchange Commission. Any information contained herein or on Multnomah Group’s website is provided for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies.   Investments involve risk and, unless otherwise stated, are not guaranteed.  Multnomah Group does not provide legal or tax advice. Any views expressed herein are those of the author(s) and not necessarily those of Multnomah Group or Multnomah Group’s clients.


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