Streamlining and coordinating global benefits at Baker Hughes
Global governance has always been a priority at Baker Hughes. But until recently an important element of governance was missing: The oilfield services company lacked a formal reporting structure that allowed management to effectively monitor the international benefit programs.
“Baker Hughes is made up of several divisions that were once separate companies,” says Michele Gest, global benefits director. “Historically, each division set up benefit programs independent of one another in various countries. And because the benefits function was not centralized at the corporate level until the late 1990s, we had no reporting structure and no way to supervise these programs.”
The company realized there was a problem when Baker Hughes personnel in the United Kingdom requested funds to lower the deficit for one of its frozen pension plans, due to poor investment performance over several years. “Senior management began asking questions: what did HR know about the plan, how did this situation occur, and who was accountable for these international programs?” recalls Gest. “When we realized HR was accountable, it became clear that we needed to be better educated. We engaged Watson Wyatt to help us obtain the detailed information we lacked in this part of the world.”
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