Outsourcing 401(k) administration yields benefits

Article Abstract:

American Express Co has outsourced its defined-contribution plan management through its association with service provider subsidiary IDS Trust. The initiative was taken by the company in response to the incompetence and inadequacy of its own 401(k) plan administration system. The decision to outsource was reached after an evaluation of its database, its cost, information accuracy and consistency, response time and employee access. Management believed that outsourcing would improve these variables and thus the quality of their plan service. Under such practice, participating employees can easily avail of enrollment information and services, change their asset allocation and contribution level, make loans or withdrawals, and gather information on accounts and the plan. Direct communication with the service provider is possible through a charge-free number. Steps in the implementation process and benefits gained by American Express are discussed.

DEPOSITORY INSTITUTIONS, Security brokers and dealers, Short-term business credit, Management, Evaluation, Financial services industry, Financial services, American Express Co., Salary reduction savings plans, 401K plans, Outsourcing

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Ongoing orientation at Metropolitan Life

Article Abstract:

Metropolitan Life Insurance Co has developed an innovative employee orientation/training program which utilizes video, a poster campaign, and input from the entire company. When developing the program, Metropolitan conducted surveys, interviewed managers about their training and orientation needs for new employees, and also surveyed more than 1,000 new employees for input. The end result was a video-based versatile program that can be adapted to a variety of needs. Recommendations for firms which would like to create similar programs include: gaining broad-based support from within corporations; planning for program updates; and considering business needs when designing programs.

Case studies, Human resource management, Employee training, Metropolitan Life Insurance Co., Employee orientation

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