Digital Transformation Maturity Model Superannuation
Assessing digital transformation maturity is helpful to benchmark a fund’s current position and highlight potential gaps to achieving the desired digital maturity.
Less mature digital transformation efforts may in some cases be driven by FOMO (fear of missing out) or keeping up with the competition. This does inspire progress, but typically leads to ad hoc or knee-jerk digital 'optimisations’ which ultimately holds funds back and increases the risk of failure to achieve goals and making poor investments with vital resources.
Important elements of digital transformation maturity
At the heart of a mature digital transformation effort is the customer, their experiences, and the journey to saving and preparing for retirement. Clear objectives for each digital transformation initiative link directly to the business strategy, the business model and of course the future operating model.
In the past, we looked at longevity of technology investments that would grow with the business. Today, the level of agility, modularity and semi-permanence about the technology are more important due to rapid changes in environmental conditions, technological advancements (ChatGPT anyone?) and customer requirements. Being able to add capability, disassemble or rebuild readily outweigh longevity.
Dedicated personnel or business units and / or specialised third parties are assembled to explore and drive innovation. This may include a chief transformation officer and chief data officer, dedicated transformation and data business units and hiring of emerging technology specialists within IT.
None
Digital transformation is not being pursued. The fund may be best placed for or consider merging with another fund, or there may not be an appetite to change at all. If the fund is administered by a third-party fund administrator, there may be a base model of the digital offering. This may come at a separate cost to the fund (and they will choose whether to invest in it).
Basic
There is a desire for transformation, to keep up with the times. Visual changes are made to customer user interfaces and correspondence but there is not a lot of new functionality. For example, the website and member portal may have a re-skin (new look and feel) and minimal changes may be made to the ecosystem including system integration.
Digital transformation might be ad-hoc and not a priority for the business. There may not be capability to transform at a good pace or supporting systems are not designed in a way to enable effective digital transformation, such as design flaws with system architecture, or unclear business processes.
Developing
Defined by clear strategic direction, the fund is making good progress. The fund drives digital transformation with improved customer experience and enhanced operational efficiencies. There is consideration of new technologies to achieve a streamlined ecosystem including system integration and automation.
There is an introduction to and continuous improvement of a digital offering such as member online apps, online joining, digital advice and virtual assistance. There is an embracing of data integrity solutions, analytics plus clear focus to highly personalise and uplift the customer journey.
Evolving
There is a shift to digital-first approach with strong focus on highly personalised and secure customer experiences which may incorporate effective use of artificial intelligence, machine learning and natural language understanding.
Funds routinely engage with specialised third parties or hire skilled personnel to drive ongoing uplift in customer experiences, technology, processes and data practices. There is a focus on paperless transactions (within the guidelines of legislation and regulators), straight through processing, automation and integration. Continuous improvement is embedded in processes and robust data integrity solutions are in place along with quality metrics.
Mature
Fund operations are structured and agile. The fund is fully mobilised with the latest technologies and offers exceptional customer experience and operational efficiencies. The fund experiments with and embraces emerging technologies and actively seeks out ground breaking change. They invest in dedicated business units or specialised third parties to drive innovation and advanced data practices.
The fund has immediate access to rich and accurate data to identify opportunities and trends, create new products, services and channels. Tactical and strategic decision making is evidence-based. Strong data integrity solutions, risk management and quality reporting/metrics are in place.
Barriers to advancing digital transformation maturity:
Absence of clear relationship to business strategy, business model and future operating model.
Absence of clear and visionary multiyear road map.
Absence of agility and semi-permanence to adapt the transformation roadmap.
Absence of dedicated business units or specialised third parties to drive innovation and advanced data analysis.
Key personnel are heavily occupied with business as usual or limited by historical thinking.
Stagnancy of innovative thinking due to the dependency on complex legacy systems.
Shortage of digital transformation and emerging technology knowledge at leadership level.
Skill shortages in program management, new technologies and emerging technology and so on.
Data enhancement and data quality not embedded in transformation or driving decision making.
Size and complexity of fund e.g. membership base, merger history, resources, third party providers.
What about funds third party administered funds?
This model should apply for self-administered super funds or funds administered by a third party. If your fund’s business model is highly reliant on third parties, it is important to maintain a highly collaborative and cooperative relationship and be willing to invest in mature platform-based infrastructure to facilitate an open ecosystem with go-to-market partners.
Transparency of the ecosystem is vital because it helps funds understand the way things operate so they can formulate what they would like to see from the digital offering. Spending the time to design and work two-way digital collaboration is helpful so that the administrator has a clear picture of fund objectives and needs.
Conclusion
Funds can advance their transformation maturity by keeping customer front of mind, prioritise transformation from the top, commit to investing in specialised resourcing, remain open to partnering with third parties and move the fund away from legacy thinking.
If your fund is aiming to reach the new levels of digital transformation maturity, QMV can help. Please reach out to QMV for further information on p +61 3 9620 0707.
Katerina Langas – Lead Consultant
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