Enhancing remuneration processes at New Zealand’s biggest general insurer
IAG New Zealand Limited is a wholly-owned subsidiary of Insurance Australia Group, and is the largest general insurer in New Zealand. IAG employs over 4,000 staff throughout the country, servicing the needs of their customers through a variety of channels – nationwide branches, call centres, sales sites, and online.
Trading under the State Insurance and New Zealand Insurance (NZI) brands, the company underwrites general insurance business for some of the country’s leading financial institutions.
In 2014, IAG brand NZI won Intermediated Insurance Company of the Year at the New Zealand Insurance Industry Awards.
Following the merger of State and NZI, remuneration and bonus practices needed to be consolidated. Annual salary reviews were completed manually using spreadsheets, which often led to inaccuracies with data, payments and review timeframes.
IAG required an efficient and robust system that could handle the significant volume of annual salary reviews and bonus payments at a set time every year. Staff were previously reviewed throughout the year on their anniversary date, so this change was a move to more common practice.
To ease the transition into this new review practice, IAG wanted a system that would help HR staff to efficiently process this large increase in remuneration reviews.
IAG were looking for a completely automated remuneration process that would allow more than 280 company managers to view their team’s information, process payments and recommend new salary amounts online. They also required the ability to control the data and timeframes of remuneration and bonus reviews, and also to produce and distribute salary review and short-term incentive (STI) payment letters electronically.
IAG opted for the Pivot Remuneration solution to assist with both their annual remuneration review and bonus processes.
IAG’s Manager of Workforce Solutions says the system is easy to use and amalgamated well with other business processes. “Pivot Remuneration is an easy system to administer, is very flexible in its design and managers find it easy to use. Pivot does not require our team to have any technical expertise in order to use the product.”
IAG were also impressed by Pivot Remuneration’s capability to predict cost and/or model potential outcomes utilising a merit matrix model.
Today, IAG requires less people to manage the company’s annual salary reviews and bonus schemes. The company has not missed a deadline for delivering reviews to employees since Pivot Remuneration was implemented. “Pivot Remuneration has a very logical step-by-step process engine which ensures we complete tasks on time and in the correct order,” says the Manager of Workforce Solutions.
She adds that the organisation now has an error rate of less than 1% and managers can access the data and complete the reviews from anywhere in New Zealand. “The production of 2000 letters is now fully automated.
Pivot Remuneration has improved the accuracy of payments to employees for their annual bonus payments and salary reviews. Our timeframes for these processes have been shortened by more than a month.”
Pivot Remuneration also helped carefully manage IAG’s remuneration budget through the use of “traffic lights”. This feature ensures that overspend signals a red light, which means salary recommendations must be sent for approval.