News & Research: Client Successes

Case Study: Outsourcing Benefits Administration During Merger

ScottMadden supported the merger of two large paper companies through outsourcing benefits administration and developing and implementing a new delivery model.

• Two paper companies of approximately equal size were merging and needed to have one benefits delivery model that reduced overall benefits costs and improved quality of service
• One company's benefits were outsourced, while the other operated under a traditional distributed-delivery model
• The demographics of the client population were complex due to the large numbers of participants, the dozens of unions, and geographic locations.  In addition, the company was upgrading its HRIS and modifying its benefit plans

• Developed the business case, highlighting cost differences between outsourcing benefits  administration, insourcing and co-sourcing
• Determined the future scope of services and customer service standards to be required of an outsourcer
• Wrote the outsourcing RFP and helped the client select a preliminary list of vendors
• Coordinated communications among vendors and client throughout the selection process to promote consistency and fairness
• Determined the selection criteria, provided tools to compare vendor responses, and facilitated the selection process
• Supported corporate legal counsel in identifying contract issues and drafted edits to the service level agreement
• Assessed and documented implementation and future risks associated with outsourcing benefits administration process to allow the company to more effectively manage risk

• Met scheduled go-live date
• Retained key employees during implementation process
• Final price was 10 percent less than the original quote
• Outsourcing agreement resulted in $22 million of net present value savings over the first five years