Sorhaitz adds that employers today are looking for a consultant that has both depth of expertise in specific areas and broader knowledge of business issues and industry trends. “The need is moving toward an actuary that also functions like an MBA—deep analytical and technical skills but [also] broader management and HR focus.”
The most vital quality, however, is the consultant’s ability to partner with the client—and how well that partnership serves the client’s needs. And when employers are in cash- and credit-constrained positions, consultants may need to focus on the long-term relationship rather than any short-term gains. “In some cases, we’ve had clients come to us and say, ‘Look, we need a fee reduction in 2009 just to help us to get through this,’” says Lee. “And we’re happy to work with them on that.”
While this may be painful in the near term, consultants agree that maintaining strong partnerships with clients is of paramount importance. “Consultants who are spending more time with their customers—trying to understand where they need to be, and being a partner with them—are the ones who I think are going to survive and do really well,” Worb adds.
After all, when it comes down to it, consulting is a relationship business. “In a shaky environment, clients want to know they can count on the people they work with,” says Beech. “Staying close to your clients is really important. The trust is extraordinarily important on both sides.”
Partners or Competitors?
Finding the best solution for a client may mean partnering with others in the industry—even if they’re competitors. It’s common for employers to have different pieces of business with different consulting firms, and consultants often need to work with insurers to serve the client’s interests.
“Turbulent times are when consulting firms tend to do well, because that’s when clients need their creativity and their intellectual capital,” explains Stuart Monteith, senior vice-president, group benefits, with Sun Life Financial. “We don’t compete with them on that front. But we have to be close and working hand in hand with the consultant to make sure that we are capable of delivering the kinds of creative services that they want to offer—and also, to be able to work in tandem with them to come up with creative solutions.”
Maintaining such a relationship can be tricky, though, when there is overlap in the services offered. From a third-party administrator’s perspective, Marla Schwartz, co-president of Benecaid Health Benefit Solutions Inc., says she doesn’t see her firm in direct competition with consulting firms. “We’re very much a complementary product to what exists out there.” However, insurance companies and consulting firms do compete on recordkeeping services and plan administration.
“If you go back to the ’80s, early ’90s, the consulting industry was predominantly focused on consulting services,” says Henry Chudak, vice-president, group distribution, with Manulife Financial. “Today, their services have evolved to be much more focused on outsourcing and providing HR-type support to their clientele. And that has created some competition between the insurers and the consultants in the areas of administration—whether it be flex or standard administration, disability management and, to some extent, absence management.”
Insurers are also expanding their presence in member communications, particularly for DC plans. “The insurance companies have changed their model over the last couple of years,” notes Salman.
“They have many services now that do compete with what the consultants provide, particularly in the area of communication and member education.” Barry Noble, vice-president, distribution, group savings and retirement solutions, with Manulife Financial, says that from the insurer’s perspective, adding these services was a logical fit. “A big part of the DC business is about member engagement.
It was just a natural progression that evolved into a more comprehensive communications strategy.”
