As a plan sponsor, you know what entity provides administration services and recordkeeping for your defined contribution (DC) retirement plan—whether it’s a recordkeeping provider or third-party administrator (TPA).

But do you know what is behind all of the processing your recordkeeping provider or TPA does?

There are a number of technology providers in the retirement plan market that offer certain processes for recordkeepers with their own proprietary or legacy systems, as well as end-to-end recordkeeping for TPAs. According to Balaraman Jayaraman, co-founder and CEO of Congruent Solutions in the San Francisco Bay area, a lot of legacy platforms do not really lend themselves to leveraging modern technology to provide a better customer experience, so Congruent launched a suite of technology solutions for the industry.

Its CORE solutions include plan set up for recordkeeping or compliance testing, data management, contribution calculation, compliance testing, reconciling investment information with contribution details, preparation of forms and schedules for both audited and non-audited plans, daily processing and year-end packages. Jayaraman says that together, each module creates an end-to-end solution, but providers and TPAs can use modules separately.

Lucas Soucy, head of North American operations, says one reason for a modular approach is that legacy providers have large integrated systems they have used for years, and they don’t look at breaking it all down in one fell swoop. They can utilize Congruent’s cloud-based modules to offer plan sponsor clients a better experience and functionality with a smaller footprint. “At some point, legacy systems will have to be reprogrammed to take advantage of services and tools of cloud providers to be able to handle processes more smoothly,” he says.

Sue Deyo, vice president of marketing at Actuarial Systems Corporation (ASC) in Los Angeles, California, with support offices throughout the U.S., says ASC also offers automation for retirement plan documents, retirement plan administration and recordkeeping software, and Form 5500.

Congruent says in its corporate brochure that a major challenge in retirement plan management is that for certain processes, the volume of execution spikes at times, but also runs into periods of low intensity at other times. As a plan sponsor, you understand this. But, do you realize that this could create a workforce issue for recordkeepers and TPAs? Do they have a workforce dedicated to the process that will either be overwhelmed in high volume times or—if the dedicated workforce is larger—will be underutilized in low volume times? This is why your recordkeeper or TPA may outsource certain processes.

For example, when it’s time for nondiscrimination testing of your DC plan, a service provider such as Congruent or ASC may handle gathering census data, processing the tests and providing reports of the results. To make it even easier, Deyo says, ASC provides integration between systems so plan sponsors and providers don’t have to duplicate efforts. Census data put into the recordkeeping system can be fed into the testing solution.

Plan sponsors are also concerned about keeping in compliance with regulations and legislation, and technology providers can help with that. For example, the Department of Labor (DOL) is focused on the timely remittal of participant contributions. Soucy notes that getting contributions in from payroll and crediting them to participant accounts sounds like a simple thing for recordkeepers to do, but it can be complicated because of a lack of clean data and different payroll systems feeding data from different types of sponsors. Congrent’s solution includes about 120 validations that the data is clean. Soucy says it typically takes two or three payroll cycles before plan sponsors get feedback on possible errors, and fixing errors can delay the remittal of contributions for investing.

For Congruent, the processing is in real time, and as soon as the data shows up on a client’s dashboard, so do the possible errors, and corrections can be made right away.

Deyo says one constant in the retirement plan industry is that there are always regulatory or legislative changes. ASC consistently updates its systems for such changes. According to Soucy, Congruent has a separate rules engine. “In legacy platforms, it can take six months to a year to incorporate new rules because they are hardcoded or embedded in programs,” he says. “We can change rules in a matter of a couple of days. This lowers costs for clients, which, in turn, lowers costs for plan sponsors.” Soucy cites the recent hardship withdrawal rule changes for which Congruent did not have to do a lot of reprogramming.

Retirement plan technology providers are also why some recordkeepers and TPAs can offer many of the same services to smaller plan sponsors that larger plan sponsors enjoy.

Deyo says with ASC, whose customers include start up TPAs all the way up to the largest financial firms, banks and insurance companies, even a start-up recordkeeper or TPA would be able to offer, at avery affordable price, a top-quality custom website, web portals, compliance testing and plan documents of the same quality to smaller plans as others provide to larger plans.

While Congruent’s clients are large banks, insurance companies and TPAs, Soucy says the constraint used to be on what a recordkeeper or TPA’s system was able to handle—either regarding plan complexity or pure volume. They had to have the infrastructure to deal with either, and technology was expensive. “When we architected our solutions, we had in mind to serve large entities, but we tried to create a low-cost solution, so even smaller recordkeepers and TPAs would be able to use our modules and get enhancements they were not able to afford before,” he says.

As a plan sponsor, you may consider your recordkeeper or TPA a part of your support system. Technology providers are also part of your recordkeeper or TPA’s support system.

“Our philosophy is that we not only provide technology, but also provide retirement plan industry expertise in a support team filled with retirement plan industry professionals,” Deyo says. “Everyone has worked in the industry 10 years or more prior to working with ASC. They help with how to use the system practically as well as technically. When a [recordkeeper or TPA] calls ASC and speaks with a support person, they are  speaking with a peer—someone who has done their job before, speaks their language and also understands what enhancements would be appreciated.”

As Jayaraman says, “The end game is not really tech per se; tech is the enabler. The end game is to provide a platform where TPAs and recordkeepers can provide a better customer experience.”

So, when you are praising your recordkeeper or TPA, remember the technology providers who are helping make that great experience possible.