Defined benefit plans dead? Don't tell that to Russell Investment Group. Russell just released an update to its Russell Pension Navigator, a Web-based tool that gives managers a better grasp of the underlying relationships between their assets and liabilities. Accessed through Russell's ClientLink portal, the Navigator draws on asset-liability studies that Russell regularly runs for its institutional clients. The updated version allows plan managers to run hypothetical scenarios and forecast their impact on corporate policy and the balance sheet. It also lets them take a more strategic approach to asset allocation.

Getting the mix right is the greatest challenge facing investment managers. "We use the Navigator to look at a slightly different asset mix than we assumed for the asset-liability study, or if we want to use different bond-return assumptions," says Sam Mele, the director of investment management for Union Pacific Corp.'s $2 billion DB plan, which covers 5,000 active employees and another 15,000 who are retired or otherwise terminated. "It's a handy way of seeing the impact of changes on our contribution forecast or funding status going forward."

Union Pacific's plan has 45% of its assets in U.S. equities, 20% in non-U.S. equities, 25% in bonds, 5% in real estate and 5% in private equity. Mele expects it to be fully funded this year. "Basically, it's a desktop version of the asset-liability model that Russell does for us," he says. "But rather than run 5,000 simulations, this one is based on a couple of hundred simulations. It doesn't give you an exact result, but it does give you a ballpark figure."