Does a technology focus on efficiency inevitably lead to a trade-off for innovation? Recent history would suggest that the answer is “yes”.
It’s fair to say that the superannuation industry is lagging the wealth management and banking sectors, in terms of member engagement, access to account details and so on. The industry has undergone a period of rapid growth and extensive regulatory change. Meeting the technological challenges of this growth has absorbed much IT focus, particularly in recent past. In particular, the introduction of MySuper and the requirements of SuperStream have been onerous and driven by very tight timelines.
A perennial bugbear in the super industry has been manual processing and data quality. There has been widespread use of manual payment (cheque) and data transfer (paper forms) mechanisms that contribute to poor data quality and result in processing delays, duplicated and lost accounts that all add costs to the system, diminish service to members and stifle innovation.
SuperStream will have an impact on this manual process. Superannuation funds will receive member information and linked payments in a standard electronic format removing substantial manual processing. Improvements to the quality of member information received from employers will reduce costs associated with rework arising from incomplete or incorrect information. When SuperStream has been fully implemented, in some years from now, manual processing will have been significantly reduced. But the second phase of the implementation of SuperStream is going to be a more complex and difficult task for many operators, and the size of the task can’t be underestimated. As much as manual processing affects the productivity of the industry, responding to SuperStream requirements effectively is equally important to the efficiency of the industry.
What does the future hold, then? Will efficiency continue to dominate IT effort?
With the right technology, super funds will, in fact, have the option of achieving both efficiency and innovation. SuperStream reforms will ultimately deliver the ability to raise service levels and self-service options, improving member experience. Technology will also deliver more channels for members to interact, including mobile, which will lead to higher levels of engagement. Super funds will be able to quickly and cost effectively introduce new products and so respond to member and market demands more effectively. Technology will also allow funds to grow in a scalable, flexible and cost effective manner without adversely impacting member service levels.
And so the quest for efficiency can lead to opportunity to innovate and technology will provide the means to achieve this.