Previously, I analyzed fraud detection and content management methods, with the assistance of artificial intelligence (AI). In my final post of this blog series, I explain the opportunities artificial intelligence provides to retirement services transformations.
For many 401(k) plans, passing ADP/ACP testing can be a very difficult and challenging endeavor, and there can be severe repercussions for failing the tests. ML and AI can be used to help prevent a failed test and to increase participation throughout the year.
At a minimum, ML can be used to automatically run projected tests periodically, identifying how close a plan may be to failure. It can also be used to identify where in an organization the biggest risks are to participation. If one payroll location is not contributing as much as the others, then schedule an enrollment meeting with it. Are NHCE (non-highly compensated employees) not contributing up to a threshold that would allow a pass? Consider beginning discussions about a match component or cutting back on HCE contributions.
Identifying Where Your Challenges Are
Read our perspective to learn the importance of digital account opening in the touch-free Covid-19 era and the top 10 questions you should ask yourself when evaluating your capabilities.
Identifying where your challenges are will significantly help your efforts when annual testing is run.
The opportunities to use AI and ML are almost limitless. The five examples presented in this blog series are just some of the areas in which these technologies can be used in financial services – and more specifically retirement services – to increase client satisfaction, reduce costs, and minimize processing risks.
To maximize the potential of AI/ML technology, it’s best to deploy it as part of a suite of solutions including a robust business process management (BPM) discipline, where an organization has a clear definition of all of its underlying business process with tools in place to measure and analyze those processes, as well as robotic process automation (RPA), which is a way of describing several different software solutions that use UIs to partially or fully automate human activities that are manual, rule-based and repetitive.
With so many AI vendors and products, both cross-industry and industry-specific, it is difficult for many firms to know where to start. Some of these vendors and their products will rise to market leadership, while others will likely be absorbed into other providers or cease to exist. Selecting the right AI solution is, therefore, of paramount importance. With dedicated practices in artificial intelligence and financial services, Perficient is well positioned to guide you through the process from concept through implementation.
To learn more about the opportunities to transform retirement services with artificial intelligence, you can click here, or download the guide below.