The Sorites Paradox and Pension Governance: When Does a Small Problem Become a Big One?

By: John Bikus, The Berwyn Group

Even stable pension plans are continually evolving as participants relocate, retire, and experience life changes. While each event may seem minor, their cumulative impact can significantly affect data accuracy and plan governance.

Imagine a pile of sand. This thought experiment, known as the Sorites Paradox, has puzzled philosophers for centuries. It poses a deceptively simple question: If you remove one grain of sand from a heap, is it still a heap? Most people would answer yes.

Remove another grain. Still a heap. Another. Still a heap.

At some point, however, the pile ceases to be a heap altogether. But when, exactly, does that happen? No one can point to the precise moment. As it turns out, pension administration has its own version of this paradox.

One outdated address doesn’t seem alarming. One participant who moved across state lines without notifying the plan isn’t unusual. One deceased participant who was not immediately identified may be an anomaly.

Viewed individually, these are small issues. Understandable issues. The kinds of things every plan encounters from time to time. But pension risk rarely arrives all at once. It accumulates.

One outdated record becomes ten. Ten becomes one hundred. One hundred becomes a systemic blind spot hiding in plain sight. The challenge is that administrators are often asked to identify a singular moment when a routine process suddenly becomes a governance issue. Unfortunately, that moment rarely exists.

Instead, risk behaves much like the grains of sand in the paradox itself. It builds gradually, almost invisibly, until one day an audit finding, overpayment, or compliance issue reveals that the accumulation has been occurring for years.

The irony is that pension plan populations are constantly changing, even when they appear stable. Participants retire. New employees enter the workforce. Beneficiaries change. Families grow. People relocate. Some move across town; others move across the country. Life events quietly reshape a plan’s population every single day.

In fact, according to the U.S. Census Bureau, 11.8% of Americans changed residences in 2024 alone. That means that, in a plan with 10,000 participants, more than 1,100 people may have moved in just a single year — without accounting for retirements, deaths, beneficiary changes, or other life events that continuously reshape a plan’s records.

The participant file sitting on a server today can create the illusion of permanence. In reality, it is a snapshot of a moving target. This is why modern plan governance is increasingly shifting from periodic maintenance to continuous stewardship.

Rather than asking, “Do we have a missing participant problem?” a more useful question may be: “What small changes are accumulating today that could become tomorrow’s governance challenge?”

Death audits, participant location efforts, and beneficiary identification initiatives are all examples of this philosophy in action. They are not reactions to a problem that has already occurred. They are mechanisms designed to identify gradual changes before they compound into larger issues.

After all, participants do not become difficult to locate overnight. Beneficiaries do not become disconnected overnight. Data quality does not deteriorate overnight. These outcomes are often the result of years of small, seemingly insignificant changes that were individually easy to overlook.

The Sorites Paradox reminds us that some of the greatest risks facing pension plans are not sudden events at all. They are accumulations.

And perhaps that is the most important lesson for plan governance. The question is not whether one outdated address matters. The question is: how many grains of sand are already in the pile?

John Bikus is a recognized thought leader in death audit and population management, known for transforming the field from static data into validated population intelligence. He helped scale the world’s largest obituary platform at Legacy.com, then launched ObitData, a first-of-its-kind obituary data aggregation platform.

Today, John serves as President of The Berwyn Group, the leading provider of population data intelligence, including death audit and locate services. He led development of Berwyn’s CertiDeath® and CertiCensus® tools, redefining how institutions identify decedents, locate missing participants, and prevent overpayments before they occur. Earlier, John held leadership roles at Kraft Foods and earned his MBA from the University of Chicago Booth School of Business.

John is a sought-after speaker on population intelligence across government, pension, insurance, healthcare, and financial services, focusing on data integrity, fiduciary risk, and measurable outcomes for the institutions he serves.