Deeper member engagement needs reliable, accurate and meaningful information. Having the ability to centralise member data and enhance it to include preferences, behaviour, communications and other demographic information creates data that supports improved decision making, better targeted product and service development and of course, more meaningful engagement.
Implementing a Data Management system offers a superannuation fund a tangible route to be simpler to do business with – whether it’s as a member, an employer or a service provider.
And that means data is not about compliance, it’s about asset management……
The introduction of the Data Management framework requires a “whole of organisational” shift in the way data is viewed, used and managed. It is a long term, ongoing commitment towards ensuring that data is viewed as an asset which then becomes the responsibility of all users to nurture and maintain. It affects all areas of an organisation where data is used: from the executive level that uses data to make decisions, through product and marketing designing new service offerings; to administration engaged in day to day maintenance and retention activities.
Implementing a Data Management framework will be by far more challenging where multiple systems are involved, however regardless of size or complexity of systems, both large and small organisations benefit from implementing a data governance framework. This will set the “rules” for the management and ownership of data within the organisation; improving reliability and accuracy of an organisation’s data to minimise inaccurate and duplicate records but also to provide a wealth of information that can be used to better understand clients (through the use of analytics) and therefore provide better services tailored to client’s needs.
A Data Management framework delivers the governance, policy and processes framework implemented to create a single source of truth of accurate and reliable data/information within an organisation. When data capturing and updating rules are in effect, an organisation can be confident that the information they hold is a trusted point of reference. In the superannuation context, consider a master member record which is accurate and reliable; has rules around validations, who can manage the record and which updates take precedence so that everyone in the organisation is using the same data whether in the Admin Team, the Call Centre or working with Employers and Advisers. The data goes beyond the basic member data used to administer their benefits it will facilitate the capture and storage of enhanced information collected for example, how the member responded to the last promotion, providing a much richer profile on which to base key decisions.
When shared across various departments, accurate data becomes key to ensuring quality in the provision of services as well as enhanced client interactions. As an example, an organisation may hold a member’s superannuation data which would include their personal and family’s (dependant) details, employment details, asset and liabilities (wealth) position for financial planning purposes and health details for insurance purposes. This information can be relied upon by multiple departments and in some instances can be updated via a number of sources (the member, their employer and even regulators). If changes to the data are not carefully managed, the quality of the information can quickly deteriorate and become unreliable and the costs to fix it escalate.
Most organisations will have an IT Security Policy in place that sets out rules about users, access, downloads and updates changes and breaches. A Data Management framework is similar: it establishes rules around access, updating, managing and deleting data, survivorship, ownership, stewardship and the processes that govern each of these aspects.
It makes sense that if data is a valued asset in your business, it is managed at the very minimum with the same sense of rigour that is applied to your infrastructure.
If you want to know more, or learn about what Data Management approaches or methodologies may suit your organisation, get in contact with the IQ Group.
With decades of experience in the superannuation sector, Leigh has deep insights into project management and operational experience in both public/private sector and defined benefit fund environments along with extensive change management experience.
2016 will be a year of consolidation for the Super industry before the next innovation wave in 2017
David Haynes explains that, while there aren’t going to be so many big picture changes in 2016, it will be an excellent time to consolidate the gains and allow super funds to showcase their points of difference. As the saying goes: “We cannot direct the winds but we can adjust the sails”.
The first term of the Liberal-National Party Government is drawing to a close, and the big question for the superannuation industry is: What changes will be put in place before the election? And what will they mean for the superannuation industry?
The Federal election may be a brake on change
The likely answer is: not very much. We are in an era when Government reform agendas are tested and often stymied, rightly or wrongly, by powerful cross-benches. The significant changes in 2016 will be from the implementation of initiatives already in train. I believe 2017 will be the year of real change – no matter who wins the next election.
Even if the election is as late as November – as mooted by Scott Morrison this week – the Government is perhaps only going to be able to convince parliament to pass a relatively small part of the reforms recommended by the Financial System Inquiry. The more ‘acceptable’ changes include to superannuation fund governance, the new requirement for portfolio holdings disclosure, ‘product dashboards’ for non-MySuper products, and the extension of ‘Choice of Super Fund’ to a small percentage of employees covered by Enterprise Agreements who don’t presently have it.
The proposed governance changes were frustrated by a coalition of cross-bench Senators shortly before Christmas 2015. The changes were intended to require super funds to have a minimum of one-third independent directors, and an independent chairperson.
New disclosure measures on a tight timeframe
The Government has made concrete proposals about improving disclosure, in relation to both the assets held by super funds and about the return and risk characteristics of individual super funds.
The MySuper product dashboard requirements, introduced by the previous Government, are going to be extended to the ‘Top 10’ investment options of each superannuation product. If the legislation is passed, both these and the portfolio holdings disclosure requirements will have to be in place by 1 July 2016, making it a very tight timeframe for implementation.
The Government also wants to extend Choice of Superannuation Fund to employees covered by enterprise agreements. Unlike other Australians, people covered by EBAs can be excluded from being able to choose their own super fund.
Of course, if the election is earlier in the year, the Government might not even have time to push these initiatives further.
The move to extend Choice of Fund is likely to be the entrée for changing arrangements for the selection of default funds. This is currently done under industrial relations arrangements but the Government would like the Productivity Commission to design a new model, as well as develop criteria for the competitiveness and effectiveness of the super industry. As the Productivity Commission has not yet been handed the formal brief, it is almost impossible for it to report before the election.
There’s a long list for after the election
The long list of issues that will be waiting to be substantially progressed until after the next election include:
- Changes to selection of default super funds
- Legislating the objectives for the superannuation system
- Comprehensive Income Product for Members Retirement (CIPR – the pre-set/default pension option)
- Tasking the Productivity Commission to review access to and the use of data
- Legislating a requirement for technology neutrality
- Single Touch Payroll
SuperStream the quiet achiever
The quiet achiever of the Stronger Super reforms has been SuperStream. All APRA-regulated super funds are now SuperStream-compliant, as are most medium and large employers and very many small employers. Enormous numbers of SuperStream transactions are being processed every day.
While implementation is likely to be a challenge for some small employers, error messaging continues to be a work in progress, and overall governance arrangements are still in flux, the introduction of uniform data standards and what will be near-universal e-commerce in a controlled and orderly fashion, is an enormous achievement.
The level of uptake of SuperStream will slowly and steadily increase through 2016, and these problems will be resolved. SuperStream will then start looking at other areas where it can assist in facilitating data transaction, and I am confident it will be used to improve efficiencies in many areas.
In the relative lull of 2016, the super industry has time to consolidate the gains. And there are things that super funds can do in partnership with IQ to help foster innovation and support innovative undertakings that will improve your members’ experience and help you develop points of difference.
Regulation versus innovation
The focus of this blog has been on regulatory change. Of course, as super funds grow very large, the question is: When will innovation overtake the need to comply with new regulations as the major driver of change in superannuation? This, and the opportunities for super funds to invest in innovation, will be the subjects of my next blogs.
The IQ Group partners with numerous super funds to operationalise regulatory change, and supports others in their development of innovation to improve the fund member experience. Growth will help super funds transcend the treadmill of regulatory change, and we look forward to working with the breadth of the super industry to achieve this.
Executive Superannuation Policy Advisor, VIC
This year is a busy one when you consider everything from world events to the impact of digital disruption. We experience a leap year, an Olympic Games, NASA touches down in Jupiter and private spaceplanes will be launched for the first time. In the financial services sector we also not only will face continued innovation and disruptive changes, but it is becoming clearer that as participants we need to have an opinion on how prepared we need to be – change will come and how you respond to that change is crucial.
Here is what I believe will influence our thinking in the year ahead:
- The New Payments Platform (NPP) [insert link to earlier blog post from Ron] will continue to make its presence felt, with a pressure wave of change in both approach and thinking about payments. The realisation of the breadth of its influence will hit home.
- As the time to respond, act and process for superfund members decreases, so too does the tolerance in superfund systems to deal with cyber security risks, as things move faster, we may come to know a lot more of what we don’t know!
- Will I really talk to Siri about my superannuation? May be not, but the rise of more integrated personal assistance technologies (leading on from robo advice) may increase in line with our acceptance of Artificial Intelligence helpers.
- What is old is new again. SMS as one of the most direct and trusted communication channels to customers may be looked at with a new frame of possibilities.
- The digital paradox may be a stronger factor in our thinking – the strategy of retaining superfund members by improving customer intimacy and experience – helping them be informed and more active in their wealth choices, may lead to greater churn. We need to be prepared to develop customer advocacy strategies to support retention.
- Finally cost, and in particular the quest for reduced costs! Cost pressures continue to ripple through the Australian financial services industry and superannuation and wealth are not immune. New players who will disrupt traditional markets will look for opportunities in changes to regulation, industry awards and a dynamic product landscape.
- Further to the cost pressure, we think this will drive them to review and optimise their digital investments, drive higher performance from service suppliers, seek process efficiency and place greater focus on project value.
Notwithstanding all of the above…the team at IQ is looking forward to a great year, and from all of us, I would like to wish all our clients and colleagues a safe and prosperous 2016!