Globalisation is an emerging theme in the Australian advice and wealth management space.

Leading research firm Investment Trends has launched its 2020 Advice Technology Benchmark Report, which provides an in-depth review of developments in technology used by financial advisers to deliver advice, covering the impact of Best Interest Duty requirements, innovations in the client discovery process, delivery of scaled advice and new competition in the space.

The Report provides a detailed benchmark ranking of Australia’s advice tech providers across four main areas Strategic Advice, Financial Advice, Advice on Platform and Advice with Product. The research covering the features/functionality used to support the advice delivery process, spanning 32 sub-categories across 740 criteria.

This year’s Report reveals many of the leading Australian advice software and back- office applications are now owned by companies operating across international borders.

“The acquisition of AdviserLogic, Midwinter and Coin – the second, third and fourth most widely used planning applications, respectively – has brought a global perspective to the Australian market for planning application development,” said Ian Webster, Analyst at Investment Trends.

“Local advice tech developers are focused on lifting practice efficiency and anticipating future changes to advice delivery models, but over the horizon, there is emerging competition from integrated applications like Salesforce-based Wealth Connect and Intelliflo Intelligent Office from the UK, a trend that is set to grow.”

“Now more than ever, advice firms have access to an array of globally available, low-cost digital services to manage their client relationships and augment their advice production applications,” explained Webster.

Australian advice regulation enforces this global shift in approaches to financial advice services – placing the needs and objectives of the client at the centre of attention.

“ASIC is becoming more involved in providing explicit regulatory guidance on their expectations for meeting Best Interest and FASEA requirements. This has increasingly turned advisers away from a product selection/replacement mindset towards a more client-centric view, centred around client discovery, strategic goal-based advice and cashflow modelling,” said Webster.

“The Regulator’s expectations that the ‘client voice’ be explicitly present in advice documents has prompted advice tech providers to invest significantly in developing the client discovery process.”

“Notable improvements to the client discovery process ranges from dynamic and modular fact-find applications, to support for a discovery process that produces a strategy and scope paper that encapsulates the service that will be provided to the client,” added Webster.

In the first edition of the Advice Tech Benchmark Report, Investment Trends has assigned Awards for Excellence to commend providers that stood out. Iress emerged as the best planning application overall, with its comprehensive functionality, compliance technology and ability to support for advice firms of all sizes. The outstanding advice tech providers across six key categories are:

Award winners:

• Best Planning Application Overall: Iress Xplan
• Best Digital Advice Process: Morningstar AdviserLogic
• Best Goals-based Advice Application: Advice Intelligence
• Best Client Discovery Application: Astute Wheel
• Best Business Management Application: Xeppo
• Best new Advice Tech Application: Wealth Central, IOOF

About the report:

The Investment Trends 2020 Advice Technology Benchmark Report provides an in-depth review of recent developments in technology used by financial advisers to deliver advice, covering the impact of Best Interest Duty requirements, innovations in the client discovery process, delivery of scaled advice and new competition in the space.

The Report also provides a detailed benchmark ranking of the four major comprehensive advice software providers. The benchmark model covers the features/functionality used to support the advice delivery process, spanning 32 sub-categories across 740 criteria.

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Investment Trends has released its latest Member Engagement Report.

Leading research firm Investment Trends has released its latest Member Engagement Report – an in-depth survey of the engagement channels, activities, transaction and advice services provided by Australian superannuation funds to their members.

The report, now in its fifth year, is based on a survey of 44 of Australia’s largest super funds concluded in December 2017. This year’s study highlights a number of important trends:

Key highlights from the Investment Trends 2017 Member Engagement Report:

• Funds are still learning to manage their digital member facing channels
• Member insurance remains a key challenge
• A strong values-based proposition is driving growth for many new retail funds
• AustralianSuper is the best all round fund for member engagement services, while Rest Super is the most improved

Funds are still learning to manage their digital member facing channels

Superannuation funds continue their march along the path of digital transformation – moving from a simple online presence towards channels that foster a more interactive and engaging experience for their members.

According to the latest research from Investment Trends, many super funds are making inroads in the development of their digital member service platform, but the move from internal processing systems to real-time member facing applications has been challenging.

“This year, we observe many funds struggling with the reliability, consistency and quality issues in the real-time digital-based channels used to support and interact with their members,” said Ian Webster, Technology Analyst at Investment Trends.

“However, super funds are gradually mastering the challenge of managing these channels more effectively, building upon basic content publishing towards digital channels that provide easy access to services and promote two-way engagement with members,” explained Webster.

“For instance, recent website developments from HESTA, Sunsuper and AustralianSuper are shining examples of industry funds adopting a ‘member first’ approach. The last 12 months alone saw a host of interesting developments by super funds, including an increase in the number of fund mobile apps, increased social media activity, and direct engagement through online chat and bot-based applications,” added Webster.

Member insurance remains a key challenge

The introduction of opt-out insurance in the MySuper reforms and a range of media coverage have highlighted the conflict between outcomes for the collective group of super members and outcomes for individual members who are encouraged to have personal agency in their own retirement.

“Super funds have enthusiastically promoted insurance to their members, but the lack of urgency among many funds to commit to the Voluntary Code of Practice is beginning to affect their social licence,” said Webster. “Most funds are only gradually accepting their role in protecting low balance members and supporting the member claims process, but AustralianSuper is among the few that have taken early and decisive action.”

“Among the 44 largest super funds surveyed, roughly half have yet to provide explicit guidance and support for member insurance claims, while a quarter do not provide explicit information about member insurance claims on their website,” added Webster.

A strong values-based proposition is driving growth for many new retail funds

A number of retail super funds have experienced sustained growth in members and funds under advice in recent years. Fast growing funds such as Australian Ethical Super, Crescent Wealth, Essential Super, Grow Super, Netwealth Personal Super and Spaceship have little in common with their more established counterparts, focusing instead on a value-based proposition that resonates with their target segment.

“Australians now have a greater choice of funds that align with their values and lifestyle,” said Webster. “While these funds do not tend to provide as wide an array of member services as those offered by the more established funds, they differentiate through the effective use of digital communication channels, growth hacking and SuperMATCH 2 to grow at pace.”

“For instance, funds such as Spaceship offer their members a more evolved digital member account experience through a well-developed mobile app and replacing their administration platform provider’s online member portal with a more user-friendly interface,” said Webster.

AustralianSuper is the best all round fund for member engagement services, while Rest Super is the most improved

Each year, Investment Trends ranks the 44 largest super funds across four key areas of member engagement – touch-points, activities, transactions and advice. On an overall basis, AustralianSuper has once again captured top spot. The top five funds by overall member engagement scores are:

1.   AustralianSuper

2.   Sunsuper

3.   HESTA

4.   QSuper

5.   HOSTPLUS

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IRESS’s XPLAN is the leading 2016 Australian financial planning application for the 10th year in succession. AdviserNETgain is the top ranked hybrid application for 2016 with Decimal the leading intra-fund advice application. The 2016 innovation award was given to XPLAN for introducing native digital document signing functionality.

Key highlights include:

• XPLAN continues to lead planning application functionality development
• Planning practices are turning to an ecosystem of services to support engagement
• The comprehensive advice model is being disrupted by compliance automation

XPLAN continues to lead planning application functionality development

XPLAN has recorded the biggest lead in application functionality over other comprehensive planning applications in the twelve years of the Investment Trends Planning Software Benchmark report.

“Australian comprehensive planning applications have their origin in the first generation of fintech developers,” said Investment Trends analyst Ian Webster. “They are now mature planning business applications that generate almost all of the regulated advice delivered to Australians.”

“IRESS continues to lead the Australian comprehensive planning application development community with an active program of enhancements, refinements and new functionality.”

Improving usability, risk product comparison, opt-in processing at scale and platform integration were the focus of planning development in 2016. XPLAN became the first planning application to support native digital document signing.

Our latest benchmarking study also found planning application developers are configuring their applications for different advice markets, such as licenced accountants and superannuation funds, and supporting a full-service approach to planning technology delivery, adding installation, configuration, training and data services to software provision.

Planning practices are using an ecosystem of tech services to support client engagement

While comprehensive planning practices use one of the six applications covered in the benchmarking report for advice generation, new wealth advisory and millennial practices are looking to CRM and workflow systems, onboarding applications, personal cashflow and fintech engagement tools to use with advice generation applications.

“Integrated services and data are becoming important to planners developing new client service value propositions,” said Webster. “This is providing opportunities for a new generation of wealth fintech developers to provide services that complement comprehensive planning applications.”

The benchmark report shows most planning practices are already using digital technology to support their online presence. Planning practices are moving from just having a website to online digital client engagement, including financial literacy content, a blog, a contact form, google analytics, and Facebook and LinkedIn social media channels.

Adoption of digital and social media continues to develop with about a third of practices supporting client login, video content and more social media channels. About 20% of practices are actively engaged with outbound and inbound client marketing using social media advertising services and eBooks.

The comprehensive advice model is being disrupted by compliance automation

The next generation planning applications will begin to be deployed in 2017 from both established and new fintech developers. For the first time in 2016, the number of new client scaled advice SOAs was larger than number of comprehensive SOAs.

The comprehensive advice model using advice generation applications to support advice processes and delivery is being disrupted by digital advice development.

Compliance automation is the developers’ response to their clients’ search for more efficient advice processes and new advice business models. Next generation planning applications and new fintech developers are developing automation for strategic advice, most aspects of investment advice, SMSF advice and all aspects of superannuation intra-fund advice.

“Next generation advice applications are responding to the demand for more advice process efficiency with compliance automation,” said Webster. “Automation will disrupt the comprehensive advice model and replace it with a package of single issue advice services distributed in time, more suited to providing advice services to a broader market.”

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The December 2015 Planning Software Report, released to Investment Trends’ clients last week, is an in-depth study of the advice solutions used by Australia’s financial planners. This year’s study highlights a number of interesting trends:

IRESS has continued to develop XPLAN into a unified advice services delivery platform

XPLAN was the top rated financial planning application in 2015, achieving the highest score recorded in the eleven years of the Investment Trends Planning Software Report. It is followed by Rubik COIN and AdviserNETgain. The top rated Hybrid planning/platform application was AdviserNETgain and Asgard.

“XPLAN continued to develop a full range of planning services for dealer groups, from private wealth to robo-advice,” said Ian Webster, Technology Analyst at Investment Trends. “XPLAN is leading the way for all comprehensive and component planning applications by offering the engine to support a new generation of multi-channel applications.”

Decimal was awarded best superannuation scaled advice application

Superannuation fund intra-fund advice technology emerged from a previous generation of Australian fintech developers led by Rubik Provisio and Decimal.

“The deployment of Decimal at Mercer and QSuper is a significant milestone for intra-fund advice technology,” said Webster. “Decimal has demonstrated that enterprise grade intra-fund advice functionality should be deployed alongside super administration platforms.” 

The 2015 innovation award went to Infocus Platformplus for analytics using peer benchmarking to promote best practice

Recent years has seen a steady increase in the development of dealer group and practice level analytics for revenue, products and processes.

“Using peer benchmarking and reflective practice is an emerging approach to professional development in many other professional service industries,” said Webster. “Platformplus’s use of peer comparison process is an innovative approach to ongoing professional planner development.”

Automated investment advice functionality is coming to most planning applications

Adviser efficiency is a key driver of planning technology development. New fintech automated investment portfolio services are influencing functionality development for comprehensive planning applications. Both XPLAN and AdviserLogic have introduced planner directed automated product replacement functionality to improve efficiency and support multi-channel advice services delivery.

The other significant advice functionality development in 2015 is the use of new insurance data to create a single comparison market for group and retail insurance products. This gives advisers more flexibility to choose the structure and select risk products that suits their clients’ needs.

Scalable advice and client advice engagement technology are the beginning of a new generation of multi-channel advice delivery applications

Post FOFA, the focus on client engagement is expanding the range of technology services advisers are using to complement their advice delivery applications. Support for structured onboarding processes, communications management, meeting bookings and integration with client desktops are being provided by third party business services providers.

The beginning of a new generation of multi-channel advice delivery applications are emerging from developers. These look to narrowing and generalising advice scope to achieve the efficiencies necessary to deliver mass market advice services.

“Both established and new fintech developers are looking to broaden the market for advice services,” said Webster. “The established advice services technology providers – XPLAN, Rubik, Midwinter and AdviserLogic – will all respond to the challenge of the new generation of fintech developers with significant new multi-channel advice services in 2016.”

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• Supporting self-directed super account services is the future for superannuation fund engagement.
• Retirement is coming and funds are starting to get ready to support their members with advice.
• AustralianSuper continues to be the best all round fund for member engagement services.
• Sunsuper, AMP and QSuper are setting a new standard for member engagement.

In its third year, the 2015 Member Engagement Report is an in-depth survey of the services Australian superannuation funds provide their members. The study is based on a survey of 44 of Australia’s largest superannuation funds concluded in December 2015, and identifies key trends in the provision of member services:

Supporting self-directed super account services is the future for superannuation fund engagement

Regulatory change, digital technology, and the renewal of some funds’ boards and executives are shifting superannuation funds from being just custodians of member funds to providers of member super account services.

“The proliferation of self-directed account services on super admin platforms enable funds to use their education and engagement activities to help each member improve their retirement benefits,” said Ian Webster, Technology Analyst at Investment Trends. “Deloitte Digital’s rebuild of QSuper’s online channel with account based self-directed intra-fund advice from Decimal sets a new benchmark for core super account services.”

The success of the Lost Super and Super Rollover campaigns over the past two years has led funds to develop a ‘Grow your super’ approach to individual member engagement with their super account. “Digital technology is providing funds with the ability to deliver cost effective member engagement strategies with a focus on individual members’ relationship with their fund and their super account,” said Webster.

Retirement is coming and funds are starting to get ready to support their members with advice

Funds are moving from their traditional focus on pre-retirement adequacy advice to the services their members will need at-retirement and post-retirement.

“As increasing number of members reach retirement, funds have a key role to play in the provision of retirement advice, particularly to members whom the adviser focused comprehensive advice model is unable to service,” said Webster. “The differences between retirement and investment advice provide an opportunity for funds to develop a member benefits focused advice model, to be delivered at the time most members will be looking for retirement advice.”

VicSuper, EquipSuper and Australian Catholic Super are among the first funds to introduce a retirement incomes proposition for their members which is supported by new products and an options-based approach to retirement advice.

AustralianSuper continues to be the best all round fund for member engagement services

AustralianSuper continues to rank highly across all aspects of member engagement, and remains the best all round fund for member engagement services. Other industry funds round out the top five funds for member engagement.

The top five superannuation funds by the 2015 Member Engagement Report scores are:

1. AustralianSuper
2. QSuper
3. NGSSuper
4. Sunsuper
5. HOSTPLUS

Awards for outstanding excellence in superannuation fund member engagement services

Sunsuper, AMP and QSuper are setting a new standard for member engagement. Sunsuper has the most innovative and accomplished digital and social media member engagement team in financial services. AMP’s attention to service design continues to deliver the standard for member transaction services and QSuper’s rebuild of its member account services has established a new benchmark for all superannuation funds.

The three outstanding superannuation funds for innovation in member services are:

• Sunsuper for member involvement
• AMP Flexible Super for member transactions
• QSuper for member advice services

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• IRESS’ XPLAN is the top rated Australian planning application for 2014 with AdviserNETgain the top rated hybrid planning/platform application
• Rubik Provisio was surveyed as the best superannuation scaled advice application
• FOFA compliance is being implemented by investing in planning technology
• New Planning technology supports client facing advice delivery and aged care

IRESS’ XPLAN is the top rated Australian planning application for 2014 with AdviserNETgain the top rated hybrid planning/platform application

IRESS has continued to develop XPLAN into a world class financial planning application. XPLAN has achieved the highest score for any financial planning application in the ten years of the Investment Trends Planning Software Benchmarking Report.

XPLAN was top rated, followed by Rubik Coin and AdviserNETgain.

“XPLAN is a world class comprehensive planning application” says Ian Webster. “The quality of XPLAN and the other Australian planning applications in the benchmark is testament to licensees’ investment in technology and Australian software engineering talent.”

The top rated hybrid planning/platform application was AdviserNETgain.

Rubik Provisio was surveyed as the best superannuation scaled advice application

Scaled advice application development continues to explore new approaches to advice with a focus on SuperMatch based super account consolidation, insurance and personal retirement advice applications.

“Provisio has been the leading developer of intra-fund advice applications for many years and is now part of a growing category of applications offered different approaches to scaled advice delivery.” says Ian Webster. “Rubik Proviso was surveyed as the best superannuation scaled application ahead of Decimal and XPLAN Engage.”

FOFA compliance is being implemented by investing in planning technology

Licensees have made significant investments in the configuration of their planning applications, adviser training and the development of new planning applications to implement FOFA compliance. They have taken this opportunity to encourage their advisers to use more of the practice efficiency functionality developed in recent years.

“The use of workflow based compliance benchmarking requires advisers to use much more of their applications than just produce SOA documents.” said analyst Ian Webster. “Aligning compliance with increased practice efficiency should deliver a better business and more consistent client outcomes.” he said.

While most advisers continue to use XPLAN or Coin, others are using large dealer group applications like PlatformPlus or midwinter’s new AdviceOS and new applications based on Microsoft Dynamics or Salesforce CRM.

“Adding planning functionality to other applications is much easier than in the past with the availability of cloud based modelling modules from XPLAN, Provisio and AdviceOS” says Ian Webster. “Organisations can develop new technology to support their advice business model without having to develop the core modelling functionality.”

New planning technology supports client facing advice delivery and Aged Care.

New development is focused on advisers using mobile devices in client meetings. Advice applications like XPLANtouch, Coin Connect and WestPac Discover Your World support client friendly presentation and data collection tools connected in real-time to practice based applications for workflow and client data. These applications enable advisers to support their value of advice proposition where they spend most of their time with clients while the practice manages client relationships and generates advice documentation.

Aged Care advice had been a specialist practice for most advisers until recent changes to the Aged Care support system prompted development of new strategic modeling tools that will enable advisers to add support for aged care advice.

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