From Barbell to Ecosystem: Rethinking Member Engagement and Advice in Super with Duncan McPherson

Superannuation funds want to deliver an outstanding member experience, but there's a significant challenge in deciding how to provide financial guidance and advice to their members.

Do you buy a digital app, build an in house team, outsource to specialists, or create a network of Approved advisors?

Duncan McPherson, principal from Borromeon Consulting, joins me, Neil Benson and my co host Sarah Penn on that super show to discuss all this and more.

Thanks for joining us.

Welcome to that super show, the podcast where we talk all things super from the inside.

I'm Neal Benson, CEO of Superware.

And I'm Sarah Penn, CEO of Mayflower Consulting.

Each week we unpack what's changing in the industry, what funds are wrestling with and how tech and regulation are shaping the landscape.

Sometimes we bring in expert guests, but mostly it's just us having a real conversation about how super is working and what could make it even better.

Let's get into.

G' day and welcome back to that Super Show.

It's great to have you join us Sarah.

We've got a very special guest on the episode today, Duncan Borrowmine.

Duncan, welcome to the show.

It was great to catch up with you at the Future fund admin forum 2 weeks ago in Sydney.

How have you been?

Yeah, great and thanks.

I don't know about special special guests as.

Yes, maybe not that special, but going well.

Interesting times.

All our guests are very special, Duncan.

Some of them are more special than.

Others, maybe for the.

For the wrong reasons.

But yeah, really pleased to be here.

Yes.

We've got lots to talk about and today we're going to be talking about advice and super and the intersection thereof.

Yes.

So we've got a list of questions which we will probably mostly ignore.

But we'll start with something on the list.

First one we've got, as we all know, super funds have increasingly built advice capability in house and then some have gone the other way.

But is this a structural shift or a moment in time?

Where is it, where's it all going?

Look, I think it's a really interesting question.

I think that there's competing priorities in superannuation funds at the moment.

On one hand there is a want to control the member experience more to in source member engagement and experience capabilities.

So I think you see that with some of the super funds contracting their own contact centers instead of using administrator based contact centers.

So I think that's a.

And when I think about digital advice, especially in the big end of town, there's more of a demand to control that user experience.

But on the advice side that having in Store in house resources becomes really challenging from a member's best financial interest perspective because people can only speak to so many people.

It also adds in a risk profile to the business.

So I think it's.

I don't think the answer is as simple as yes or no.

I think there's a lot of dependencies that go into it on how that decision is made.

Yeah, I'm seeing a shift from the model where we used to have one big partner, maybe a ifs or somebody providing financial advice to all of our members.

There's quite a few funds either bringing that advice capability in house and employing financial advisors.

Another model is to build a network of approved financial advisors as well.

And that seems to be a really good balance between handing off to specialists because there are different financial advisors whose expertise suits members at different points in their career or in their lifestyle.

Early career advisors, mid career when it's all about accumulation, or later in your career when you're thinking about retirement or even post retirement.

And I don't think every advisor is an expert in every one of those stages.

And so having a network of different advisors that a fund can recommend and introduce a member to seems to be a pretty decent model.

Is that model becoming more popular, Duncan, or is it just a couple of fun.

I think what's becoming.

I don't think there's.

I'm not trying to avoid the question, but I don't think there's one model.

I think what's becoming clearer or needs to become clearer depending on different parts of the market is where the advice threshold is between building your own internal capabilities and where the threshold is that you move to engaging external capabilities.

So what I think needs to probably evolve is I actually think that advice threshold historically is a reaction to what is actually happening.

And then you retrofit.

I think funds are now starting to proactively think, where do we want that advice threshold to be?

Where we are no longer going to be able to have internal advice capability to service someone and we're going to actively engage external advice capability to support our members.

So I think it's less about one model, it's more about how a fund defines that advice threshold and whether they are recipients of what's happening in the market or they actively look to manage that and define it.

Yeah, because it used to just be intra fund do inside full advice.

Maybe we have some, maybe we outsource, job done.

Yeah, but as you say, there's a big difference between, you know, multi generational advice involving aged care and family trusts and God knows what else versus stuff that's not intra fund advice.

But isn't that complicated?

Yeah, but it's also running a running advice team is expensive and so the fund needs to make a decision around where their priorities are and where their costs are best used.

I think, I think what's actually happening starting to happen a lot more and a lot quicker.

And it kind of goes to that point around owning the member experience is advice moving from a functional unit that sits outside the service ecosystem to advice sitting inside the service ecosystem and then molding that advice strategy to the ecosystem for consistency.

So just because they can give intra fund advice or simple intro, simple retirement advice by advisors inside the fund doesn't mean they're going to now I think digital enables that to happen a lot more.

If they can partner with a digital provider that can help with productivity and instantaneous, more instantaneous advice in comparison to models that have been in marketplace where the production of advice internally is confused with power planning, writing your own plans, gathering data from members.

So the time to actually deliver the advice is weeks, not hours.

So I think the digital is enabling them to do more internally.

DBFO kind of almost started to open that door, but I think that door, DBFO is kind of no longer on the shelf, I think is in the storeroom.

Right.

So yeah, yeah, I think it's on ice chopped up in the freezer.

So I think there's, I think there's, there's a more concerted strategic engagement of advice on superannuation funds which is prompting them to ask these sort of questions more than what they did a few years ago, let alone 12 months ago.

Yeah, well, I think we all thought DBFO was going to change everything.

So I'm sure people were in some places not kind of holding off decision making about what the future was going to look like until DBFO was real and then deciding what to do as a result.

But now, yeah, I think that's, I think that's right in the, in the main.

But what I would say, my view is that when the government interests, the government facilitates the funds.

Right.

So when they regulated around, well put.

When they regulated around Heat Maps funds focus went on to investments, investment teams.

There's a lot of in house.

Then it went on from sippers into Retirement Income Covenant and the funds then built product solutions so that became FASA and products built out these longevity products.

Right.

Or started to, or gave thinking.

And what we've missed in the advice space is DBFO coming in and regulators saying you gotta do this and creating that emphasis around member servicing.

So Stephen Jones never went beyond the do better.

I think that was kind of going to be that servicing.

Now, what I think is slightly different.

What I've observed that's slightly different.

I think a lot people might have different opinions.

What DBFO has actually done without being legislated is we've actually seen a mindset shift by a lot of funds who started doing more than they would have previously in this space.

So they've actually taken the spirit of DBFO and nudges and providing more digital advice.

And so I think it's actually been the first example that I can think of where funds have actually led the change instead of letting the regulators innovate for them.

Yeah, that's fascinating.

So nudges haven't been legislated, but they're not really legislated against.

So how far we can push it in terms of providing some proactive guidance.

I think that's.

It's interesting how you say that, because when DBFO came out, I spoke to a number of my contacts in funds and they said, well, of course you can do these anyway, there's nothing that stops you doing nudges.

Now what I wrote in collaboration with Core Data, we wrote a paper for the FSC on the role and value of digital device in Australia, and we also had collaboration with Zen Al Hasan, who's a partner at Mills Oakley.

We wanted to talk about the regulation and the legislation packed up and then said, well, there's nothing stopping.

There's no legislation that is stopping superannuation funds from doing digital advisory.

It's more an interpretation than it is a legislative barrier.

And what kind of came from the stakeholder interviews with super funds that we did and digital providers and licensees is it's more the posture of the internal risk and compliance teams than it is the legislation.

And that.

That's not a criticism, it's an observation.

And I think.

I think kind of way I frame it in some respects is that risk and compliance are very conservative after the Royal Commission and they've probably been slower in relaxing that conservatism than where the market, where consumers are and where some of the funds are going.

So that would be my interpretation around tv.

Yeah, I think that's absolutely.

I think that's absolutely right.

To be honest, I actually would say, from my point of view, I think it is a criticism.

I think we've missed a massive chunk of years of opportunity when we could have been doing better for members.

Things can be really tested now in the AI space.

Sarah, because where, because the change is going to be, I think I said this once before, change is now measured in months, not years, right?

Yeah, yeah, so true.

So the internal conservatism around how you deal with AI in this example will have a magnifying impact on the ability to recover and people will go to unregulated advice and unregulated sources of information and if they then don't, and when they go to their trusted Source of the SaaS Evaluation Fund and they're still operating on a linear website, then people probably go back to AI and not come back.

So I think that conservatism is going to be tested really rapidly now.

So is the race really on to try and get good enough digital and advice and nudging and support by the funds to stop there being such a exit out to AI in terms of consumer behavior that we can't get back from it?

Yes, but I'd approach from a different perspective.

So I'm very conscious that a lot of this sector, a lot of decisions are made of the answer is this now what's the question?

So the answer is digital advice, what's the question?

Or the answer is AI, what's the question?

So I'm very conscious of that.

I think the way I would respond to your questions there is consumers are moving rapidly.

They are using AI all the time.

They are using it from all manner of things, from information through to advice, whether we like it or not.

And we need to, as a regulated sector, choose how we're going to respond and in that response, what is going to be the, what we're going to do in order to respond to that and how are consumers?

Because consumers are forming their experience expectations in different sectors and applying them to our sector.

Whether we like it or not, that's what's happening.

So I think then you say, okay with that, knowing how are we going to respond and what are the things we need to do.

A couple of weeks ago, Duncan OpenAI launched Personal Finance ChatGPT in the US it's connected to 12,000 different financial services providers through a kind of middleware.

And once you connect your bank account or your wealth account or your accounts, you can now chat with ChatGPT and get answers like when can I retire?

How can I save for a house?

And you know, get those kind of questions answered with data that's somewhat grounded in your own circumstances and your own data.

Do you see that launching in Australia?

Do you think, you know, today we, we can have those kind of conversations with ChatGPT but it really doesn't know our intimate personal details.

It hasn't connected to any of our accounts.

And even if I go for professional financial advice today to get that data to my advisor, it's downloading a bunch of Excel spreadsheets or statements and uploading those into a portal, which seems pretty old school these days.

Is that connectivity layer missing?

And do you think funds are reluctant to enable it because It'll only enable ChatGPT advice and not professional advice?

Look, it's a really good question.

Probably a couple of things.

I don't think funds are actively not engaging with them.

One of the things that I don't think we give enough credit to or acknowledge enough is the fact that we're an old system.

We've been around for.

How long has super been around?

40 Years.

Right.

And so we're not like the US or the UK where it's kind of emerging now on newer technology bases.

We're on old technology and the technology that we use for administrative information funds, we can criticize all we like, but they are the custodian of a huge amount of information and a huge amount of actions and we're very critical of them.

And I worked at Link Administration Services and people are always going on about Link.

Well, hang on.

Link probably administered more early release payments during COVID than any other administrator.

By huge amount.

I was in those meetings every day.

Right.

And the amount of money that was moving from moving into cash, whether we like it or not, or being drawn out, they didn't skip a beat.

Right.

They met all the obligations for all these funds.

I'm sure people will say, oh, but hang on, they did this wrong.

Yeah, I'm sure there are some cases, but you know, you're dealing with millions of these transactions and billions of dollars.

Got to get the bloody thing right.

So there is a technology that's a real challenge there because notwithstanding, I give them credit on that, the market's moving really quickly.

Now.

The second thing I'd say is Australia's regulatory environment is completely different to the U.S. so we're a lot more conservative.

So I think we don't have the open banking or the open financial services like they do in the UK and that even then that hasn't really materialize and the benefits that they want to.

So long way of answering your question.

Look, I think in the future, everything you see in the US will come through here at some point in time.

Is it immediately going to happen?

No, I don't.

And notwithstanding the infrastructure challenges, Australians, if you look at The Edelman Trust barometer.

Australians have the lowest trust of AI of.

Was it 17 or 27 countries?

Oh no.

Oh yes.

By a long way.

Right.

Is this good, bad or ugly?

Duncan?

So no, they've got the lowest trust and the trust of big business and the trust of governments is really low globally.

Right.

So yeah.

So when you think about ChatGPT, Anthropic and these types of services, I think there's another layer of complexity.

They can do it, but will people want them to do it?

I think is the question.

Our research that we do with core data for that FSC piece said that across all age groups, their trust in AI increases when there's human support around it, even the under 35s.

Right.

So if I overlay your question with that, there is no human support around ChatGPT or and what anthropics released.

So I think the capability is really interesting and we need to continue to build to what it can be.

But don't underestimate the human support and the brand that sits around it.

And I trust my super fund probably more than I trust this anthropic or chatgpt who's doing A, B and C in the headlines.

Right.

So.

So I think we need to think with a mindset that'll go that way, but I think it'll take a while to get there.

I find Australians to be a very skeptical bunch altogether as a nation in the financial services sector.

Pretty low level of trust in financial advisors.

Pretty low level of trust in NRL football referees given the state of origin last week.

Pretty low.

Yeah, right, that's right.

It's, it's.

I'm no social scientist, but you're right, we Australians are pretty go their gut a lot.

Right.

So.

And we are conservative from regulatory perspective.

Someone once described that, you know, in Australia we kind of wait for the government to innovate, then we follow.

Oh dear me, yeah.

In the U.S. when they, they big business goes to congressmen and tells them this is what, this is the bill you've got to put up.

And they put it up.

And in the uk it's kind of a combination of the two.

So by sake of that, we are conservative and we are quite paternalistic in some of the ways we approach.

But consumers, again, if I go back to my point before consumers experience and expectations built in other markets and other markets are global, so they might not like that, but they're going to bring the feeling back and say, well, hang on, I get a really good feeling because I get an instantaneous response.

How Do I replicate that?

And I think that's where we've got to look at the experience part.

So how do funds do that?

Like, if people really like digital with some human involved, what are you saying?

That it's actually is working, I think.

And my experience is in the advice space and I've spent a lot of time in the digital space.

It's building as a part of a, a service and advice ecosystem.

So.

Ecosystem.

And the reason why I think this is really important is it's not a linear engagement.

People don't call the contact center then go, I'm going to talk to general advice, then I'm going to do something digital, then I'm going to talk to an introfo and then I'm going to do this.

They don't do that.

They're going to jump around an ecosystem of services.

And just because people want humans around doesn't mean they're going to use it.

So it's kind of knowing that there's someone there.

So I think it's that it's a hybrid engagement that comes out of it and it's built less on advice.

Advice just clutters the thinking.

Advice isn't the first thing you think about.

It's the engagement and the confidence to act is my view.

And then as a result of that, how we deal with that is advice.

It's not the problem we're trying to solve.

And I think that's where that ecosystem center is.

I can talk to someone if I want to.

The trick we've got to do is how do we build digital services?

And digital advice is one of those.

It allows people to do more themselves.

So when they actually speak to us human, which is expensive and as scarce, and they're not going to get any more, that they're actually ready to talk to someone as best they possibly can.

And we're using them for the right purpose, not changing addresses.

We are answering meaningful questions or helping people to understand what they need in order to build their confidence to act.

One of the things that you mentioned in your presentation at the forum, which I think plays into this ecosystem aspect, is the persistence of data.

So if I provide some information to my fund as part of an information gathering exercise, whether I just want a simple question answered like a simple question like what insurance is most appropriate or which investment options should I consider or when can I retire?

There's going to be backwards and forwards, some Q and A, some data gathering and provision, and oftentimes that gets lost or siloed in a system somewhere.

Particularly in advice systems.

And whenever the fund then goes to do a marketing communication or an education communication to its members, it can't really take into account the information that the member has provided about their marital situation or their housing situation or their income.

And so that communication falls flat because it's more generic than it needs to be.

Are you seeing funds step up and really put the technology in place so that that member profile is much richer than it was before that whatever's in the administration system is complemented with other data sour like the advice system.

So it's more holistic.

Yeah, look, it's.

Yes, but I think it takes a bit of time.

So working with a couple of funds, we've started off the engagement, started off as we need to.

We need digital advice.

We've been in the market looking around for the last 12 months.

There's so much information in there, we're kind of now stuck.

What do we do?

Right.

So the challenge is not information, it's actually synthesis of information, sequencing and trade offs.

Like now what I tend to do is take a step back and go, well, what do you actually want it to do?

What's the member experience you're trying to achieve?

And what emerges with a little bit of discussion and it's kind of informing the process is it turns around to.

Actually what we want is remember me.

I call it as just remember me.

So every time someone comes back, they pick up where they left off from and that builds trust.

And I've taken that data persistence, the term Neil, and called it experience persistence, which is we retain the experience and build on it each time instead of going back to zero.

And I think that's really important.

And in order to do that digitally you learn so much about the person, but the way you continue to build that persistence is through digital advice because you know so much about someone in order to give them the next step in their process.

It involves a personal advice recommendation, but it's not personal advice led, it's experience led.

And I think that that's where the funds and I wrote a piece I posted this morning fun enough around this, a little bit around this concept, around the barbell.

We hear a lot about the barbell approach in Superannuation and I challenge that.

I think it's gone.

And the barbell was based upon you help people when they join the fund and you help them when they retire in the middle, you leave them alone.

Yeah, and I think that's gone.

I think that's so 2005, isn't it?

Like yeah, yeah.

So, you know, one of the.

I think I might have said this on the panel.

You know, the.

When I got into the industry many, many years ago, the guy who was managing me as a sales industry back then, he said you never lose control of the sale, you always control what happens.

Well, we've lost that with Pandor.

Consumers have it now, they do whatever they want and we're now responding to them.

So that ability to.

We've now got to have a system that responds and that's where the experience, persistence comes in.

And I think it's vitally important and the barbell goes because we've seen now people, the research resource people in a 45 and between 45 and 54 are a key group that are not being catered for in pseudo service models necessarily.

Today you're talking, do we think we.

Need, do we need to get back to sales like, like that number one of look after your goddamn customers.

Yeah, well, I think, I think, I think the sale, the definition of sales has changed.

Yeah, true.

40 Years ago it was how many, how many Superfund members did you get to join?

Now it's, it's the sell is around consumer metrics of their confidence and enabling them to do things.

And as a result of that, they'll use your product.

So it's flipped around and it is.

How do you.

But commercially, Sarah, shaking commercially, at the end of the day, the fund is still, they need funds under management.

They need it in probably more growth orientated assets because they're going to get more margin on that and et cetera, et cetera.

So there's no doubt the commercials come into it, but it's how you get.

The commercials has changed.

Yeah, I love going back to just like straight out commercials.

Who's staying, who's going, why are they joining, why are they leaving?

What are you doing to hold onto them in the meantime?

Why are you ignoring your customers?

Why did you ever think that was a good idea anyway?

But I think, I think you can't get away from that.

Whether we, you know, we'd like to be more altruistic than that, but we can't get away from that.

No, but, but the reality is, and super funds have seen this over the past decade, that new member numbers mean nothing if they leave within a year or two because they're actually a net cost to the business.

Oh yeah.

So, so it becomes, if we work so hard and this is, this is marketing.

I learned this father poor four or five ps doing my marketing unit back in 1993.

You know, it's kind of you and me both.

How do you, how do you then once you work so hard to get a new member, how do you keep them?

And how you keep them is not, is multifaceted now.

And advice has a critical role to play in that at the front end for people to make the right investment decisions because we know that people in choice have a higher, in choice products have a higher balance than people in my super across the board.

But we still see.

I was doing some analysis last night on this actually, which funnily enough is on my next screen from last night because I didn't shut it down.

But you know, we're talking 80, 90% of people still in my Super.

Really?

That high?

Good lord, yeah.

Oh yeah.

And rising.

So when I have a look at, or I do analysis of something like, I don't know how many members is it?

This is 17 million members from about, I don't know, 10 or 12 funds.

And 86% of people under 35 are in my super.

That drops down to 50.

At 55 to 65, that's 64%.

That's still a.

Sorry.

You know, to be fair, I think my super products are shifting a little bit, becoming a little bit more growth oriented.

I think super funds have recognized that leaving a lot of younger people in a balanced portfolio for most of their lives is not doing them.

So this is an interesting discussion Neil, which might be a little bit off topic but let's see how we go.

When you talk to Canada, it's non compulsory.

So when a digital advice provider works with an employer, because an employer based, not super fund based, that member is making a conscious decision, I'm putting money away.

So they will then go into the digital advice engine 15 times a year on average.

Now that's one end of the scale.

The other end of the scale is you have a compulsory system which no one's arguing with.

It's pretty much one of the unintended consequences of a compulsory system with a default into a MySuper product is inertia and lack of engagement.

Now you're right, MySuper is brilliant, but it's very paternal, isn't it?

We've got it now.

You're 30 actually shouldn't be in a balanced fund, you should be in a high growth fund and if you are, your balance will be completely different to what it is in 20 years time.

So yes, there's no argument that it's a great system.

My supers are performing really well.

But what I don't See, and I wrote a report about this last year actually with the.

What I got a little bit frustrated with in July or August last year or this 2025 was super.

Funds were celebrating great MySuper returns which completely agree with but very few then said, but if you had had it in a high growth fund, you would have got an extra 2% which translates into an extra $300,000 retire.

And I think that's the type of next step things that I kind of think a lot about.

You just triggered something, Duncan, because having worked in the.

I do that with a lot of people having worked anger or frustration or boredom.

I've got a retirement account in the UK, a 401k and a traditional IRA in the US and a superannuation account, a couple accounts in Australia.

It's the only country that out of those three that I've lived in and worked in with a compulsory retirement system.

It's also the one with a compulsory voting as well and apathy.

Like I'd say 86% of people under 35 go to the polling booth in Australia not knowing who they're going to vote for until they get there.

The political system is just about the same as the level of engagement with the superannuation system.

And the compulsion, I think it's partly too attributable for that.

But you got to be careful, right, because you wouldn't have it any other way.

That's right.

But I think what we've, and this is a barbell analogy is just leave them be and then worry about them at retirement.

Now I think that's the risk.

There's lots of risks.

So then people are coming to you when it's a high risk decision and it's urgent and they've got no room to move so they just got to do it.

So I think that, you know, but then disrupting the inertia is a risk as well because then you're educating people, you're engaging.

And I've seen funds, in actual fact I've done analysis around the choice versus MySuper and I've seen funds that at a particular point in time the average balance of choice members drops below the average balance of my super members.

Because the only thing I can draw on and because you can't get down to the data, but the only hypothesis is is the high value choice members left the fund.

Yeah, yeah.

Exiting stage left.

Which then goes to what's your service proposition to help those people?

Because they don't need advice.

They might only have 200 grand.

So they don't need to go and pay someone five grand necessarily right now for advice.

But some might not all of them.

So what's that?

And that's where the advice ecosystem in a super fund helps support those members, make a decision and retain their interest and engagement.

Talking about trying to retain members at that point where they wake up and engage.

We're seeing huge outflows from APR regulated funds, mostly advice led outflows over to platforms.

And I'm wondering, so there's a tension there that if we nudge members towards an advisor that they might leave the fund.

And at the same time advisors are saying, look, these big funds are really hard to work with.

I'm just trying to find out what balances, what they're invested, what the recent transactions are, what the contributions they've made this year.

And it's really hard to get that data.

I've got to sit on a phone line 20 minutes and try and get the answer out of a contact center.

So there's this tension between being hard to work with and the people you're trying to as from a funds perspective, the folks you're trying to work more amicably with are a risk to your funds under management.

It's a real tension.

See any funds yet?

Yeah, look, it's, it's, it is front center right now and there's, you know, success of it.

There's a couple that are doing it well I think but there's, there's actually a mind shift probably.

One of the things that worries has worried me most over the last six months has been the emerging narrative again around rollouts to advisors.

People are rolling out because they trust the advisor to do the right thing by them.

Now, whether the advisor has positioned it in a convenient way that makes them more trustworthy than the fund.

That's business.

Right.

Whether we like it or not, the advisors and you know, the vast majority of advisors, and I say vast majority because I have had experiences where people aren't right.

So let's put those aside.

They're doing the right thing, right?

Yep.

They're doing the right thing by their business, by the member.

They're not doing anything wrong.

But what the funds have done is they haven't engaged people and instead of when they go to their engagement 55 instead of competing against disengagement, they're actually competing against another service provider.

So they're having to win them back, not win them the first time.

Right.

And that's a harder proposition.

So I think working with advisors is absolutely critical and when we were at Link, when I was at Link, we built the advisor portal for superannuation funds.

And what we were trying, the purpose of that was to how do we reduce the friction between the super fund and the advisor?

So we take, we try and take off the table but reduce that friction and the.

What's the right word?

It's kind of the conflict between the two because the answer kind of what we're trying to take off the table.

Let's talk about it with my team would say how do we stop the advisor saying bloody hell, they're too hard to deal with.

You know what, I'm going to roll you into this then I can help you.

Yep.

So how do super funds become the second preferred product provider of an advisor?

So they're going to have their Net Worth, their Hub24 for their blending portfolios and doing the high value stuff they do but then they've got someone with 2 or 300 grand.

How do I use a simple superannuation fund that I don't have to go and blend portfolios but I can give advice to, to help that person reach their goals.

That's where I think super funds should be targeting.

Maybe in the future they can compete with model portfolios but I don't think that's their game.

I don't think they should.

But they will lose more people, they will lose less people if you they have a service proposition that helps people build their own confidence and helps them with advisors, helps advisors understand more about their fund.

And that's going to require a little bit of a mind shift shift for some funds because there's still an active discussion around trustee tables on whether they allow advisors to charge fees or not.

These guys running businesses, they're not going to do it for free.

So you've got to work out whether you're in it or you're out of it.

If you're out of it, geez, you better go hard.

So advisor fees for helping members choose the right super fund or stay in the right super fund.

Putting in place third party authority forms and consent to exchange information.

Getting the information exchanged.

Are there any other real sticking points for financial advisors trying to work with a big industry fund today?

Look, I've built a advisor relationship maturity model which is based around what I think the six areas that funds need to be focused on.

Five areas that funds need to focus on in order to be able to help with this marketplace.

And the first thing is it's around the strategy and the positioning of it.

So advice and working with advisors need to be in the strategy.

So it's not a reaction, not a bolt on.

Correct.

And it's not a response to outflows.

It is a fundamental principle that our advice threshold is set at this level and if people look like this, they're going to talk to someone and that might not be just financial, that might be, you know what, they live in Kalgoorlie.

We're not going to be able to see them, we're not going to have.

They're not going to be able to come into an office, they're not going to be able to see them, they're going to want to talk to someone personally.

So let's get.

And we've got groups of people in Kalgoorlie.

We should have a relationship with an advisor because we know some people just need to sit down and talk to someone face to face.

So it's going to be part of the strategy.

The data access and integration is the next one.

The data access is the portals.

Also it's the integration with financial planning software.

So remove the friction from the advisor.

So that is, that means data can go out of the admin system and into, out of your database into the provider.

So then they can run them like they can other clients.

Third one is operational efficiency which goes to your point, comes off that portal, Neil.

But it's kind of third party authorities.

Third party.

We digitized third party authorities over the.

That was the second biggest risk and admin error at the administrator.

Because if you spell the name wrong, right or you put in the wrong number.

Human error, right.

There's just, there's so many of it's human error.

I make error like.

But that becomes a risk and it becomes a rework.

So having order and electronic signatures for fees, third party authorities, all that sort of stuff is really critical.

And then the other thing we had to grapple with is third party authorities come in with the advisor's name on it.

But then the support staff member rings up.

Well, they're not allowed to speak to them.

And then you think about, well hang on, this is complex because if that support staff member leaves next week and they've got their own sign on, they've still got access to member data.

So it's not as easy as just give everyone access.

So it becomes a little bit more complicated and then it's relationship and communication.

How do you build the relationship of trust between the advisor?

They can understand your fund.

They can understand.

They can, they understand why they should leave people in there.

Because your investment philosophy is this and you do this and your insurance policy is great because you insure people over 5 meters where no one else will.

Right.

And then it's all going to be centered around member outcomes.

So they're the five areas that I.

Look at is that the management is that typically done by a human team?

Are there like advice development managers who, whose responsibility is to chat to advisors and let them know about product changes, insurance changes and get the feedback.

Well Neil, I'm a little bit out of the retail space for a while but you know I meant to believe there's this.

There's a whole lot of new technology out there and there are things like this AI and stuff that can help.

So I think it's.

I think it's a combination of both.

You still want someone to talk to because when I think about operational efficiency the other thing that needs to get a lot better is workflow management.

So advisors don't know where it's up to.

So it's kind of a black box.

So being able to have those systems that can connect and communicate so relationship is letting them know what's going on in the fund.

Where do I go when there's something wrong or I've just got this member of yours who's got this really sad case or it might be hardship, it might be bereavement, it might be the wife of a member who the members suddenly died and they've got to work out what to do with it.

The advisor's now representing them.

I need to talk to someone and the fund should be all over that because my members died and I've got a partner who is in a really bad situation.

We need help and the advice and they've gone to an advisor.

So how do we help that advisor?

Help our members partner to resolve it.

So it's multifaceted.

That thing about with.

In speaking I've spoken to a couple of financial advisors lately and their inability to get the information they need out of a fund and the funds often don't have an advisor line.

So then they call the member line.

They block it up for hours.

Complicated questions.

There's a whole.

There's a whole.

They don't help themselves though.

They don't help themselves though because there was one a few years ago one of the.

One of the funds had a.

Or one of the retail.

Big retail I think it was a bank based.

Actually they had a contact center team in Malaysia.

I think it was calling up to get the information so.

And they just kept ringing up and then they get it at the time of the first appointment, then they'd want it followed up again four weeks time before the SOA was done.

So they're making two calls, they go for 20 minutes to 30 minutes for average handle time.

And, and you just.

So they had to then stop?

Yeah, they had to stop them because they were just dominating the phone lines when they didn't actually need it.

So I think that's, that's an old story but you know, it works both ways because having, you know, I think a dedicated phone line is the right thing.

But then you got to stop advisors calling it by giving them access digitally so they don't have to call because they don't want to be on call.

No.

So range of this one.

So Duncan, we covered a lot of ground today from the operating model, from the funds and advisors, the ecosystem, the technology, the relationships and it seems to be challenge ridden.

I'd say we've been banging our heads against the wall here discussing some of the big issues that are facing both the funds and advisors.

Let's wrap up with a vision of the future for advisors and for the members in Australia.

What could it look like?

What could the future hold in terms of financial advice in Australia?

And let's leave our audience with that picture.

I'd probably look at it through a different lens to you.

I think the opportunity set right now is better than it's ever been.

I think that we have, I think advice has become accepted inside superannuation funds more than what it has been over the years gone by.

And there are, in the superannuation fund there are some really smart people.

And the one thing that I'll never criticize a superannuation fund of is their focus on helping their members.

That doesn't make the front page of the news.

The one member who had an issue will make the front page.

But I've sat around these meetings, these people are just single bloody minded about members.

So it is, it is such a great thing.

So what I think we're seeing now, where I see the opportunity, where I see this emerging, I think digital is starting to hit its mark.

There was an announcement yesterday about quite a high level senior executive joining a digital provider.

I think that sees us moving from a proof of concept into okay, now it's got to scale up.

So when you're attracting talent like that to digital provider, I know them all.

I think I know them all pretty well.

I think there's probably nine in the marketplace, maybe 10.

And when I go into that, they're all different.

And you See now that they're impressive, right?

But not without their challenges, scale up challenges, a whole range of things.

But I think they're starting to.

The conversation of superannuation funds is becoming really quite real.

I think there's some challenges the way super funds are approaching it that they're starting to work our way through.

So I see in the future the focus on helping people to build their confidence to act and digital and AI having a huge role to play in that where people will be able to put jumbled words into a fun site and get logical responses.

Now that will change engagement, that will change understanding and we will help people have a greater handle on it.

I think as a result of that also, we need to also work out that advice threshold, bridge into comprehensive advice.

So there's a.

Both sides of that bridge need to be built out.

What is our offer inside the fund and do we want to do it?

And I see that being built out and where members will be able to do a lot more with their fund digitally from when they joined it all the way through till they're going to make a copy complex decision and they're going to be able to tap into human support of all different natures as they go through that journey.

And I think that'll be the model of the future.

And advice is a subset of that model.

Hooray for that future.

Bring it on.

Yeah, sounds great.

I'll have three.

Well, it's, that's, you know, it's, it's not, it's not a new model.

It happens in all, you know, all kinds of all other service services and product environments.

Now.

I don't think, I don't think human behavior changes.

I think it's just we hold them back sometimes.

Great.

Well, Duncan, we'll make sure we include first of all a link to your paper that you published in conjunction with Core Data for the FSC and your LinkedIn profile.

Appreciate you joining us.

Yay for LinkedIn.

Yeah, thanks so much, Duncan for coming on.

This has been an excellent discussion.

Thanks, Sarah.

Thanks, Neil.

Thanks for having me.

Thanks for listening to that super show.

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