HFS Highlight: Atos builds a Nest in Life and Pensions BPO

Atos has a global opportunity in the Life and Pensions (L&P) market. Its recent contract award with UK pension provider Nest is a big deal, especially in the realms of business process outsourcing (BPO). This UK deal could be seen as a springboard to further opportunities—within the UK and globally.

Nest is a UK workplace pension provider, set up to support the UK’s auto-enrolment scheme more than a decade ago. Its growth has been impressive—acquiring almost 10 million members in that time, with more than 800,000 employers using its scheme, and £16bn in assets under its management—almost a third of the UK’s working population have a pension pot with Nest.

Now Nest is moving to the next stage; its first 10 years established the market and got employers through the door—now it’s about engaging and expanding its relationship with its members (employees enrolled in the pension scheme) digitally. Atos will reimagine Nest’s services to enable it to deliver personalized and tailored services to each of its members.

Nest’s shift in service delivery comes in 5 strategic objectives:

1. Improving customer outcomes for members and maintaining and improving the relationship with employers and “connectors” such as accountants.
2. Digitalise the business by connecting operations and aligning the front and back offices through agile delivery.
3. Cultural alignment with social purpose and value: Nest sought a partner that understood its aims and values.
4. Risk management and security: Nest is a regulated business and must tightly manage risk.
5. Commercial sustainability: delivering objectives in a sustainable way and getting value for money by balancing the cost-effectiveness of solutions and outcomes.

Nest selected Atos after a 3-year process based on the alignment of transformation objectives and culture

Atos will leverage its existing BPO assets to deliver its proposed solution within a highly regulated financial services (FS) environment—based on experience and success with AEGON having given it a foothold in the market by the end of 2016. The solution will empower Nest staff to deliver customer experience changes through customer-centric design and an advanced self-service operating model.

Atos will deliver a modular cloud solution for Nest to embrace innovation and new technology over a 10-year contract—Atos will help Nest react to new technologies and opportunities in an agile way while working within the regulation.

Beyond the solution and technology, the factors Atos sees as being the most important in this win cover:

• Supporting Nest’s values to support its members through a revamped customer-focused, personalized experience; Atos and Nest will leverage CX labs and talent, designing the customer journey based on data analytics and insights
• Cultural change programs previously delivered by Atos—such as a CX Academy at a leading UK University
• Outcome-based contracting—and precedent around operational excellence, delivering improved processes efficiencies and risk compliance

The project will be delivered on a greenfield basis, in a big-bang implementation after 2 years using 400-500 people to create designs, cycles, and processes. With partners, Atos will be reusing assets and ideas from the rest of the business including building platforms with Pega for workflow and marketing solutions for personalization, Sapiens for core systems records and the broader management of data, and infrastructure on Azure public cloud, before using Agile and DevOps process sprints over 12 months—and in parallel designing migrations and new operational solutions; over 10 million members will be migrated to Atos’ solution.

“Traditional labor arbitrage started a trend in financial services (FS)—before re-platforming and revamping legacy apps and infrastructure also came into play. Nest is always keeping an eye on balancing cost reduction and improving CX. Atos is looking to bring L&P 3.0 to the market through digital transformation and a CX approach to delivering new digital landscapes and outcomes.”

Richard Holland, CEO Atos BPS Ltd

The Bottom Line: Nest is a platform for Atos to become a global force in L&P BPO

This contract with Nest was a major step forward for Atos—and now Atos is at the front and center of the UK’s BPO market for L&P. These ideas and platforms are reusable globally. The upper management of Atos in Europe used to be skeptical, but now there’s interest in BPO propositions outside the UK, especially looking ahead to pension reforms in France and The Netherlands in 2025. Beyond Europe, conversations are ongoing for Atos to take this springboard into North America and Asia.

The opportunity for Atos is amplified when you look at foreign markets; in the UK the L&P cost base (cost per member per year) is approximately £7.50, but in Australia and France it can be as high as £180… Ancient technologies, platforms, and systems scattered throughout the industry mean Atos has a huge opportunity to build on following its upcoming transformation journey with Nest.