Emotional Data
The Trekkies amongst you will be familiar with the character of Data, whose one desire in life was to be human and experience emotion.
It isn’t always easy to associate emotion with data. It’s hardly an exciting, sexy topic that enthrals a Trustee or an administrator to discuss it over a pint on a Friday night or to be the centre point of a conversation at a dinner party. Yet as a Trustee or an administrator we are all too aware of the importance of data in the delivery of scheme benefits to members. Without good, quality data, benefits will be calculated and possibly paid incorrectly, leading to complaints and costly compensation. Without good, quality data scheme valuations could be calculated incorrectly leading to wrong contribution rates being set and funding levels assumed.
All of these scenarios lead to negative emotions being displayed around data. From frustration and annoyance (of the wrong benefits being calculated) to anger and blame (the data we were given was wrong!). Yet wouldn’t it be great if we got excited and enthused knowing that the piece of data that has been fed into a benefit calc has ensured that the member has been paid the right amount of pension. Or that the data cleansing that has taken place on a group of members means that the valuation assumptions are right and that contribution rates haven’t increased as much as they could have.
Bringing the passion to data isn’t easy but it needs to start with the administrator, after all they will be using it on a daily basis. The key here is understanding how and when data is used, and perhaps more importantly, recognising the impact when data is either missing, incorrect or used in the wrong way. The administrator must always have the end objective in mind, that of paying the right benefits to the right person at the right time.
Administrators need to be educated about the data held within their schemes, understanding how the various data components come together to calculate a transfer value or retirement benefit. With increasing reliance on technology to ensure the administration process is efficient and effective, some of the key appreciation of data is lost as checks and validations are performed automatically within the pension system. There is a belief, therefore, that the system has produced the right figure but experience may suggest that this isn’t always the case. Knowing the data will allow the administrator to take a view as to whether the calculation or output ‘looks and feels right’.
Data requires investment both in time and expertise in ensuring that not only is it right, but it continues being right going forward. A lot of effort (and passion!) can be used to cleanse data for a scheme that if it is not maintained, can quickly deteriorate over time. This can then become demoralising to see all the good work wasted knowing that it has to be done all over again. Any cleansing activity needs to identify the reason for the data being wrong or missing in the first place so that the root cause can be fixed. Again the administrator plays a key role here, as they will have an understanding of how the data has been captured and populated onto the pension system.
Data can be, and should be an exciting subject. Much like doing a jigsaw puzzle having all the right pieces together helps to focus on the larger picture. And as the pieces begin to fall into place and the picture becomes clearer, then the excitement and passion to complete the jigsaw increases. And once complete there is the satisfaction and joy of knowing that the effort and care taken has produced the perfect result.
The administrator’s passion to deliver an excellent service should be their passion to ensure that data is complete, consistent and correct.
by Michael Mann
Administration Director - Projects