Digital technology is giving superannuation members more information and oversight than ever, reducing the industry’s traditional “stickiness”. Add to that new nimble competitors and incumbents today face arguably their biggest disruptive threat.
The information flow, however, is two way. Financial firms know more about customers than ever before and are now vying to turn those insights into experiences. Large firms especially have access to troves of consumer data, albeit with the paired challenge of delivering at scale.
And, as consumer knowledge grows so too do their expectations, inflated by digital masters, often in completely separate industries.
Cambell Holt, chief customer officer at financial services giant Mercer, says customers now take their best digital experiences and set them as a benchmark for all other transactions. The ‘“expectation transfer”, as Holt calls it, is driving a new wave of competition in superannuation — experiences. To deliver them organisations are leaning on their own digital technology.
“The industry is really only just scratching the surface with the ability for technology to power personalised, contextualised experiences,” Holt told Which-50.
“Being an experience-led business, rather than a product, or transaction-led business, is the next great battleground for delivering value to customers in our industry.”
But customer experience is not a hallmark of the superannuation industry and Mercer, which manages the retirement savings of over one million Australians, has to deliver those experiences at considerable scale.
“Human insight is the lifeblood of any successful financial services organisation into the future, and to be able to scale truly great personalised experiences across large customer bases you need to be able to achieve mastery in leveraging technology in this space,” Holt tells Which-50.
With roots in the first half of the 20th century, Mercer is no stranger to change. But, Holt says, digital technology in particular has opened up an information to consumers in unprecedented ways for the super industry, with firms racing to stay ahead of expectations.
While it puts pressure on Mercer, ultimately the trend benefits both consumers and organisations, according to Holt.
“The best possible outcome from all of this is where consumers continue to become more empowered, more in control and more confident in the way they manage one of the most important assets they’ll ever own – their retirement savings. Digital technologies have enormous potential to inform and empower consumers with their finances.”
People, process, technology
While technology is driving many of the customer experiences and how organisations can respond, when it comes to organisational change it plays a surprisingly small role compared to people and processes, Holt says.
Mercer began its own large scale overhaul in 2014, coinciding with Holt’s arrival from ANZ after nearly a decade with the bank. There was a clear need to change but that is not true of all organisations, Holt says.
“Doing transformation for transformation’s sake is one of the biggest pitfalls. This is when and organisation is seduced by the purported benefits of new technologies and fail in some way to be clear on the consumer or business benefit.
“I see a lot of leaders seduced by the potential of a new technology, but not clear on the real objective, what’s most important to customers, when starting out.”
It is actually the people and processes that falter during digital transformation, Holt says, a result of a relative over-investment in technology.
“Many people are freely able to talk about the technologies that are being utilised to transform a business, but I hear much less discussion about how the way people will need to operate differently do their work when the technology turns up.”
Holt told Which-50 he has been guilty of it himself in the past. “Underestimating how much change is required across the dimensions of people and the process within a business to fully realise the benefits of digital transformation”.
“To deliver on the vision, pretty much everything about the way people work, the required skillsets, the processes they follow, and the way people derive value and meaning from their work needs to be re-imagined during a large scale digital transformation if organisations are fully realise the benefit. Bringing people on a change journey across all of these dimensions ahead of, and during a digital transformation is essential.”
Cambell Holt is a member of the advisory panel for the Which-50 Digital Experience Awards.