Amex Waves Bye-Bye to Old RK System

May 11, 2004 ( - American Express Retirement Services said it has successfully completed the transition of its 401(k) retirement plan client base to the BlueStar service platform and is decommissioning its old system.

Instead of relying on a central mainframe computer to store and process data like many of the traditional defined contribution/401(k) systems, BlueStar uses a distributed “client/server” design which allows administrators to make targeted changes without affecting or interrupting service to other users, American Express said in a news release (See New AMEX RK System Goes to Client/Server Setup ).

American Express said it developed a seamless, intra-day transition process for each client in order to keep participants’ assets in the market.

The decentralization allows technology administrators to make targeted changes to one or a group of desktop computers without affecting or interrupting service to other users. American Express spokesman Todd Wold said Bluestar’s underlying software is from the WySTAR system, from PFPC Inc. and that the clients had been moved from the prior system, Plan 1.

PFPC eventually sold WySTAR to the Wachovia Corporation in April 2003 as part of a larger deal for PFPC’s retirement plan recordkeeping and third-party servicing business (SeeWachovia Brings PFPC Recordkeeping and TPA Business On Board ).

American Express Retirement Services has made an investment of more than $50 million in its large plan recordkeeping business, the company said in the announcement.

In recent months, some in the RK field have pushed for a consortium of vendors to develop a common platform that will keep each from having to foot millions in development costs but allow the vendors to customize the platform to each client’s needs (See Common Ground ). Officials at some RK players assert that their own platform offering could be the basis for that industry standard.