PLANADVISER - September/October 2020 - 37

simply a fact-gathering exercise that sponsors can conduct
to have some documentation of a prudent process, " he says.
Itzoe agrees. " Sometimes plan sponsors are very happy
with their incumbent and have no intention of moving to a
new adviser. It's more about just taking the temperature of
the market. That's fine, but if that's the case, I don't want to
go through the heavy lift. "
MHK Retirement Partners, in Madison, Wisconsin,
tries to meet with at least one member of a sponsor's plan
committee before deciding how to handle the RFP, says
Daniel Helf, a retirement plan consultant and a partner in
the firm. " When we get an RFP, we'll say to the sponsor,
'Can we get together for a meeting?' If the sponsor says,
yes, then we'll spend more time on the RFP. If the sponsor
doesn't want to meet with us, it's probably just doing the
RFP for documentation. We'll respond but only with our
preformatted responses. "
When sponsors are willing to meet, Helf has an interactive
conversation with them about big-picture issues such as
their plan's current status on retirement outcomes and how
MHK can help. " It's about taking the plan to the next level, " he
says, adding, " If we spend an hour talking with a sponsor, it's
usually pretty apparent if it's going to be a fit or not. "
Due Diligence
That does not mean Everhart Advisors shuns all RFPs. Hanna
says it makes sense to respond to them when someone at his
practice knows someone at the sponsor's company or at the
sponsor's other vendors. He says it is particularly helpful if
they know a decisionmaker at the prospect.
Robert Massa, managing director of retirement at
Qualified Plan Advisors in Houston, says it is important to
gather as much information about the plan as possible in
order to do an effective and successful job of responding
to requests for proposals. " I'll ask the plan sponsor for
the summary plan description [SPD] and plan document, "
Massa says. " Sometimes they'll even provide you with
existing vendor service contracts. If I get these, I look to
see if they are in an agreement they can't get out of or if
there's a lock on the investments. "
After obtaining these documents and looking up the
plan's Form 5500 and any plan audits by the Department
of Labor (DOL), Massa compiles a list of questions to send
to the prospective client. " The questions could be about its
plan, its demographics and its expectations of its adviser, "
he says. " The questions are different for every single RFP. "
Likewise, Itzoe does his research to find out what a sponsor's
" hot button issues are. Some plan sponsors are forthright.
If they aren't, I explain that it's in their best interest to
provide as much information as possible. "
Itzoe invests a great deal of time at the prospective
client's office. " I will visit their office for a day-and-a-half
to meet with all the key stakeholders and decisionmakers
to make sure we're educating them about the best practices
we can bring to the table and see if they're interested
in that, " he says.
In Itzoe's experience, the most valuable piece of information
a prospective adviser can find out about a sponsor is
who its current adviser is, which he finds on the Form 5500.
" That gives you a sense of who you're competing with and
tells you what their compensation is, " he says.
" We do a tremendous amount of work prior to filling out
the RFP to find out what a company's particular needs are, "
Itzoe says.
John Ludwig, founder and financial adviser at LHD
Retirement in Indianapolis, suggests advisers also gather
information from social media sites, such as LinkedIn, and
the company's own website.
For his part, Massa arranges
... the volume
of RFPs they
receive
outweighs
their value,
particularly
if they fail to
result in new
business. "
for a one-to-two-hour interview
with the retirement plan
committee, human resources
(HR) leader and payroll department.
" We'll talk about all of
the challenges they're facing
and what
they are trying to
achieve, " he says.
Actually filling out the RFP
takes 10 to 60 hours, he says,
" depending
on
cated it is and how deep the
sponsor wants to go. "
Itzoe advises following the
sponsor's cue in how it has set
up the RFP. " Treat its questions
like
a
lastic Achievement Test], " he
says. " Answer them exactly as they were asked. Be honest
and forthright, and don't use the questions in the RFP as an
opportunity to insert your marketing spin, but as a chance
to demonstrate your due diligence. "
Blaine Aikin, founder and principal of Fiduciary Insights
LLC in Pittsburgh, recently held a roundtable with affiliate
Fi360 on sponsors' interest in fiduciary services from
advisers. Aikin says many of the advisers who spoke on the
panel noted that sponsors include questions about 3(21) and
3(38) fiduciary services in RFPs and that advisers should be
prepared to offer these services.
As far as the length of RFPs, in Itzoe's experience, if an
RFP is constructed appropriately, it will be between 50 and
100 pages.
Besides responding to plan sponsor RFPs, Everhart
continues to seek new business through its strong relationships
with ERISA attorneys, accounting firms and health
benefit consultancies, Hanna says. " They understand the
value we bring to our clients. "
On top of this, Everhart solicits referrals from existing
clients and conducts webinars to educate sponsors.
The bottom line, Hanna says, is advisers should be
prudent about which RFPs they respond to. If the sponsor
is forthcoming, it is probably a real business opportunity.
For those advisers just starting their practice and building
their book of business, they should not be too discriminating,
he says. -Lee Barney
standard SAT [Schohow
compliplanadviser.com
September-October 2020 | 37
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