The retirement and pension fund sector holds a large part of active workers’ savings, which is why it plays such an important role in the economy.

Nevertheless, guaranteeing the integrity and excellence of processes as these institutions is no simple task.

The new demographic reality and constantly evolving technologies have demanded significant changes to find a new model of excellence in retirement and pension fund management.

Key challenges faced by retirement and pension fund organizations

A study published by Harvard Business Review found that internal dysfunction and growing complexity are the biggest barriers to good performance at institutions.

Over time, there ends up being an accumulation of heterogeneous, unconscious and isolated processes. Some of them come from different processes and technologies introduced by heterogeneous management models. And some are the result of organizational resistance to change.

The same is true for the retirement and pension fund sector. Common problems at these institutions include:

• Use of inadequate management tools;
• Paper-based processes, with manual data entry;
• Missing, incorrect or inconsistent data;
• Frequent shifts in the financial market;
• Macroeconomic instability;
• Instances of fraud, bribery and corruption;
• A lack of investment instruments;
• High cost of raising funds in the capital market;
• Legal, actuarial, credit, liquidity, operational, market, governance, compliance and other risks.

Faced with this, what would be the solution to these and other problems?

How to overcome challenges

It’s tough to implement organizational changes and it is particularly challenging in the retirement and pension fund sector.

However, changes to beneficiary profiles and preferences, market volatility and the growing exposure to the new regulations that are emerging mean that change is a must at most institutions.

Adherence to good practices and solutions for excellence are essential to stay competitive. Professional management demands resources such as:

• Tools that meet business specialized business demands;
• Trained employees who are prepared to adopt and follow new and more efficient practices;
• Well-defined processes, with control mechanisms to prevent deviations and losses.

Consequently, pension funds and other organizations connected to this sector are increasingly turning to technology to overcome these and other challenges, making processes more efficient, lowering costs and providing sustainable results to benefit participants.

If you’re interested in learning more about this topic, I invite you to download this eBook: How to promote digital transformation in the retirement and pension fund sector.

It discusses 10 pillars to help retirement and pension fund sector organizations overcome today’s challenges and stay efficient day-to-day.