• Practice Groups
• Benefits Group
• International practice
• Human Capital Group
• Insurance and Financial Services
• Investment Consulting
• Technology/Benefits Administration Solutions
• Entry Requirements
• Training
• Profiles
• Case Studies
• Locations

Case Studies

Akzo Nobel

Key Issues

Akzo Nobel is an international company active in the areas of pharmaceuticals, coatings and chemicals. They have operations in 80 countries and employ about 63,000 people.

In 2004, Akzo Nobel appointed Watson Wyatt as the pensions administrator to the Courtaulds Pension Scheme with the objective of achieving a successful handover from their in-house administration team by 1 August 2004 with a transition period of some six to seven months.

The Courtaulds Pension Scheme is a defined benefit arrangement with a relatively complex history. In terms of membership the Scheme has approximately 1,700 actives, 27,000 deferreds and 19,500 pensioners. Watson Wyatt is the actuary to the Scheme.

Because of the history, historical records and knowledge available to the in-house team, it was agreed that Watson Wyatt and the in-house team would work together during an initial period of due diligence before the installation began. This was incredibly helpful to all parties as the information gleaned during the process helped set priorities and identify challenges and risks. The due diligence process made a significant difference to the robustness and transparency of the installation.

Approach

In terms of scope of services, Watson Wyatt provide core administration, accounting and (limited) treasury and pensions payroll services. Core administration is provided from our Leeds office, with accounting and treasury and pensions payroll being provided by the centralised teams based in Redhill.

When we began the transition, as in all these processes, it was clear that a successful outcome could only be accomplished through a great deal of co-operation and goodwill on both sides.

The early challenges we identified together revolved around the transfer and collation of paper files, the capture and automation of benefit calculations and the need to populate specific components of the database. Any mature scheme with significant numbers of deferreds and pensioners are bound to have ‘pockets’ of incomplete data, and the Courtaulds Pension Scheme was no different in this respect.

We agreed from the outset that although none of the in-house team would be transferring to Watson Wyatt, there was a desire to retain their skill and expertise beyond 1 August to ‘de-risk’ the process. The in-house team helped with a number of ‘projects’ especially involving file co-ordination and data ‘cleaning’.

The solution we offer the Trustees of the Courtaulds Pension Scheme is delivered from our own integrated administration and pensions payroll systems with accounts, on a separate application, also fully integrated.

The main data sources have been collated into a single database linked to automated calculations and letters.

Results

Today the Watson Wyatt team is delivering core administration services from Leeds, alongside the team administering the UK Scheme, dealing with member enquiries consistent with the excellent relationships built up by the former in-house team. Pensioners receive their payments, help and advice from our pensions payroll team in Redhill.

For the Trustees, the Company and Watson Wyatt the transition process was successful, not least because a pragmatic approach was adopted from the outset and the in-house team were ‘included’ from day one through recognising their critical influence on the project outcome.