Though HR and benefits people generally care about people and improving retirement outcomes, their task can be easier or more difficult depending on the culture of the company, especially starting at the top with the CEO or CFO. At a TPSU program held at Memphis University, a TPA consultant with 45 years experience working with ERISA plans has found success by delineating these two types of CEOs into either what he calls shepherds or ranchers.
Terry Dunger, based in Memphis, from Acuff and Associates, with offices throughout the south, describes shepherd CEOs as more paternalistic interested in helping people to create a successful retirement willing to devote time and resources. A rancher CEO is more concerned about the bottom line and will offer a retirement plan sometimes just to say the company offers it and let’s employees fend for themselves. Neither is good or bad but it’s important for HR professionals and their consultants to understand the differences making varied approaches to each.
While the shepherd CEO might be easier to convince of incorporating the Ideal Plan with various auto features as well as financial wellness, the rancher may not want to be that involved or devote valuable employee time to go to education or enrolment meetings never mind a full-fledged financial wellness program.
Instincts will move the shepherd CEO to a more inclusive and generous 401k plan but finances and company health will motivate the rancher. Not only are happy, less stressed employees more productive, older workers ready but unable to retire cost more and can frustrate younger workers ready to move up.
Companies grow and change so a culture that started out less interested in providing generous retirement plans can morph into one that sees the benefits while the economy or financial setbacks can mean a temporary setback for more paternalistic companies. Knowing the company culture, especially at the top, and adjusting to change will make an HR professionals job and life easier.
