Operations Newsflashes: Russell Investment Contracts With IBM, and more
Investment manager Russell Investment Group has entered into a seven-year "business transformation outsourcing" agreement with IBM, valued at $105 million. IBM Australia will assume operation of Russell's Member Administration Service Center.
All of the Service Center's operations and a majority of its 199 employees will transition into a wholly owned subsidiary of IBM. Russell will maintain client relationship functions and IBM will work to improve the service experience members have with their superannuation fund.
Russell's Member Administration Service Center holds $14 billion in assets, including its flagship $1.9 billion Russell SuperSolution Mastertrust fund.
The decision to outsource operations of the Service Center was driven by the demand for cost-effective, faster, more complex member administration services. The deal is also, in part, a result of considerable growth by the Russell SuperSolution Mastertrust.
"We believe a seismic change in superannuation administration is about to occur as choice takes hold and more people begin to ‘own' their growing super balances. Super administration requires scale and constant technological innovation to stay at the leading edge of member services," said Alan Schoenheimer, managing director of Russell in Australia, in a release.
"With the rapid growth in our mastertrust and other funds, we want to ensure the processing part of our business is able to accommodate growth without compromising the quality of member services," he added.
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