There’s no doubt that digital innovation is central to the sustainability of Australia’s superannuation sector.
Thinking otherwise would be a bit like saying that people don’t need air. You can see the importance of digital in SS&C’s recently-released superannuation trends for 2019. In some way shape or form, digital innovation is crucial to a fund’s ability to navigate every one of these trends:
- Digital to the core
- Regulatory uncertainty
- Member outcomes
- Member engagement
- Accelerating M&A activity
- Operating model
- Governance and accountability
- Automation, new technologies and platforms
You can see the importance of digital in the rapidly growing palette of technologies and platforms that funds need to master if they are to build sustainable growth. For example – open banking, the new payments platform, blockchain, cryptocurrencies, data analytics, AI, machine learning, APIs, RPA, fintechs, insuretechs, mobile first, voice engagement, chatbots, cybersecurity and more.
To survive and flourish in this environment, funds need to go beyond seeing themselves as mere users of technology. They need to see themselves as technology companies.
Instead of innovating at the margins, firms must recognize that their digital capabilities are as core as their people. And see that technology and innovation are intertwined. They must understand that how they leverage technology will ultimately define their member experience, productivity, compliance, competitiveness, scalability and speed.
So, these are the goals. But, how do you make the transition from a traditional to a digital fund?
As I outline in my below video, I believe that making this transition broadly requires two principal steps.
The first is to ensure that trustees and executives have a clear understanding of technology: ‘Texecutive’ leaders as we call them. They need to be familiar enough with technology to:
- See the opportunities and issues that technology is creating
- Navigate the necessary decisions
- Manage the long-term performance, issues and inevitable changes
Having developed this capability, the second step is to develop a clear, member-first technology strategy. This means:
- Developing a clear picture of your members and their optimal outcomes and experience. The same goes for regulators, partners, investors and employees
- Designing the strategy that will meet these needs
- Considering how technology can support the re-invention of your core so that it can ultimately deliver on this strategy. This means decisions like:
- The right operating models
- The right expertise to support the leaders and board
- The right technology mix, services and support
This is where the right technology partnership becomes invaluable. The right partner will be able to guide you through this process and support you every step of the way.
Not only can the right technology partner help you in all these areas, they can do so flexibly by offering you a number of potential partnership models. Some could involve your technology partner sharing the risk with you.
So, if you are looking to embrace digital innovation and become a real digital fund, your technology partner might be a good place to start. And, if they’re no help at all, maybe it’s time to find a new one.
To learn more, check out our whitepaper: From Angst to Advantage. This is the first in a series of four whitepapers outlining how superannuation funds can benefit from partnering with DST Systems, now part of SS&C Technologies, to develop an intelligent operational structure.