Naomi Brown: Should pension scheme trustees think of their members as customers?

How was your pension scheme experience today? We are all used to businesses telling us that we are valued customers, asking us for feedback, how likely we would be to recommend them to a friend, or simply to rate our experience by choosing from 🙂😐☹️.

But is it time for pension scheme trustees to start thinking of their members as customers? In other words, as individuals whose business they have to actively work to earn and compete to retain.

In the golden days of defined benefit (DB) schemes, there was not really any reason to. Members joined the pension scheme as standard and contributed at a relatively low rate, if at all, to receive a valuable benefit. They needed to make minimal choices both while building up their benefits and at the point of retirement, and few would ever have thought about opting out or transferring their benefits out of the scheme.

But, in the modern world of defined contribution (DC) benefits, self-invested personal pensions (Sipps), contract-based schemes and mastertrusts, pensions flexibilities, individual savings accounts (Isas) and pension scams, not to mention a cost-of-living crisis, it is different. Against this backdrop, it is now much more important, but also much more difficult, to ensure that members have confidence in their pension scheme and are happy with the service they get from it.

So, how can trustees make sure their members feel this way, given they are likely to have relatively limited resources to dedicate to optimising the member experience and building member loyalty?

Well, it sounds obvious, but explicitly acknowledging the importance of the member experience and agreeing that it is a strategic priority is a good first step.

Make it a core part of the trustee conversation and a key factor in decision making. When thinking about how to allocate time and budget to new projects, a trustee should ask, “how will this impact our members in practice”? They should actively consider things from the member perspective, as well as the trustee and business viewpoints.

Take a closer look at the front-of-house aspects of the scheme’s operations which are most likely to drive the member experience, such as: key member-facing processes. What does the end-to-end process look and feel like? Are there any easy wins which would make things smoother for members; complaints handling. How easy is it for members to raise a query or concern? If they do, how do trustees make sure they feel like their concerns are being properly considered and, if appropriate, addressed? Also, are communications as user-friendly as possible? Do they highlight the scheme’s features? And member feedback. How and when do trustees ask for feedback? What happens to the feedback?

From the trustee perspective, getting the basics right in these more visible areas should significantly reduce the likelihood of getting a ☹️, and potentially a costly and time consuming complaint to go with it.

For members (or should we say customers?), it could mean much, much, more.

Naomi Brown is senior counsel at Sackers