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A fund for life?

Many superannuation funds see themselves as a fund for life. Much time and resources are spent on helping members to grow their super in the accumulation phase. Ageing memberships also mean more time and resources are now being spent on the retention of members at retirement.

But how well are super funds catering to the needs of members in their post-work lives to ensure they truly are a fund for life? What are the needs of ageing members and how can funds best engage with them?

Retirement has retired

Retirement is now viewed as a ‘second act’ where personal growth, expansion, learning, socialising, and contributing to the community are important in ensuring a happy (and long) retirement. It’s no longer just about recreation. The concept of retirement as ‘slowing down’ (and sometimes viewed as ‘retiring from life’) is dead. So, too, is the idea of being in full-time work one day and retired the next. Now, the journey into retirement might mean transitioning through part-time or contract work, a late in life career change, starting a business, volunteer work, or taking up further study.

This ‘new retirement’ changes what funds should communicate, the modes of delivery, and the supporting services they offer to members. Increasingly, there is emphasis on planning for retirement holistically, taking into account relationships, health and wellbeing, as well as finances. Retirees want a fulfilling and meaningful post-work life, not a perpetual holiday.

Not one homogeneous group

Super funds have historically viewed retired members as one homogeneous group, but ageing members are incredibly diverse. Think about the needs and lifestyle of someone in their 60s compared to someone in their 90s? Then add in the complexity of personal circumstances – someone in their 60s bringing up teenage children in a blended family with a mortgage and school fees has a completely different set of needs and interests to a debt free 60 year old with adult children and grandchildren.

The importance of segmentation and tailored, personalised communication is just as important in the post-work phase as in the accumulation phase. Member profiling and segmentation based on behaviours rather than physical age is important. And its importance is going to grow given the post-work cohort is getting bigger as our population continues to age.

Fear of outliving savings

One of the biggest fears of retirees is outliving their retirement savings. With rising lifespans, members can now look forward to up to 40 years in retirement. At the same time, more and more retirees are still paying off a mortgage, many are still supporting adult children, the divorce rate amongst retirees is increasing and many are forced to retire earlier than they would have hoped.

The role of property as a retirement asset is also undergoing generational change. Many of today’s retirees own prime land or inner-city property and they’ve had strong capital growth since 1992 – giving them the choice of downsizing or leveraging that asset for retirement income purposes.

The next generation of retirees will be in a different position. For them, housing is increasingly out of reach, which means they’ll need to rely on their super or other investments as the primary income for retirement, which may include paying rent.

Funds can assist members in addressing both a shortfall in savings and ensuring available funds last as long as possible.

Age is about mindset, not physical age

The concept of ageing is being reinvented. Good health is viewed as something that can be maintained for longer, and so, if you’re living a healthy lifestyle, age is more about mindset than physical age. Many people in their 60s do not consider themselves old (it’s the new 40s), and 70 is the new 60. Unfortunately, 80 is pretty much still 80 because of declining health, but the point is, retirees don’t see themselves as old until declining health plays its part. Leading funds recognise this by engaging members with lifestyle-based communications that talk to members’ interests, rather than communications that are triggered primarily by regulatory change.

Three phases of ageing have different needs

Research suggests there are generally three post-work stages of life – an active phase, followed by a sedentary phase, and then a dependency phase. The active phase is usually the early years of retirement, the sedentary phase is when health starts to decline, and the dependency phase involves a need for aged care or assisted living.

These phases don’t apply to all and vary in length across individuals, but research tells us that expenditure levels vary at each stage. This has implications for the products and services funds offer to members. Funds can assist members to prepare for and navigate each stage with flexible products and services that cater to changing circumstances.

Members want funds to play a role in aged care

Health care and aged care costs are increasing due to our ageing population. Greater pressure is being placed on the individual to fund their own health and aged care costs. A 2015 survey by CoreData, undertaken on behalf of ASFA, found that more than half of the respondents thought super funds should play a greater role in helping to organise and pay for aged care.

More than half of those surveyed over the age of 45 were currently dealing with, or had dealt with, aged care management issues for themselves or family members. The majority dealing with the aged care system found it difficult or somewhat difficult. There is considerable demand for super funds to provide education and advice on aged care, with 60 per cent of members likely or very likely to take those up.

Fresh ideas on reshaping services and communications

A fund for life means engaging with members, no matter what their life stage or circumstances. Weight of post-work numbers means super funds will increasingly be called on to cater to the needs of their ageing members. Leading super funds will remain competitive by moving beyond the traditional realms of accumulation and retention at retirement by understanding the needs of ageing members and delivering services and communication to match those needs.

Ideas to consider

Here are some ideas for reshaping services and communications aimed at your more senior members:

    Can aged care advice be incorporated into your comprehensive advisory services? What about tools and information that members can self-service?

    Audit your content, images and information channels aimed at retirees with a fresh eye. How well do they match with the lifestyles of members, their interests and needs?

    Put your retirement planning information to the test. Is it purely financially focused? All about regulatory change and not much else? Consider broadening to more of a holistic approach.

    Consider telling stories to win the current and future generation of retirees – facts are great, but stories capture hearts.

    Don’t ignore the power of personalised data projections provided in engaging ways. Why not tell members exactly what their chances are their super will last their lifetime – and what to do about it if they’re falling short?

    Consider retirement income solutions that provide the flexibility to match the changing
    expenditure patterns of post-work members at the different phases of ageing.
    Are you addressing each phase?

    Take a fresh look at what you are doing to meet the needs of retired members. A fund that does this well will truly be a fund for life.

Written by Ian Taylor, Principal Consultant and Chris Dvoracek, Director Transform for the October 2017 issue of Superfunds magazine

Why it pays to rethink your redundancy communication

Something has changed in Australian workplaces. Over the past few years the ‘generally accepted’ way of planning, managing and communicating layoffs has begun to shift.

We saw evidence of this at Ford and Holden with the use of long term transition plans, expos to help workers find new jobs, redeployment initiatives, skills training and retirement planning. Nor are these cases unique. In 2016 ServiceNow launched a partnership with Soldier On to help Australian veterans retrain and reintegrate through a range of holistic work and wellbeing services.

While redundancies are still about finding efficiencies, a different set of drivers is now a big part of the equation.
In particular, rapid and widespread digital disruption, plus ongoing globalisation, are prompting a rethink about the composition of workforces and the way we work. Some predict the future of work to be increasingly flexible and comprised of ‘contingent’ workers with multiple ‘gigs’ rather than careers. Australia already creates more part-time jobs than full-time jobs.

Below are several shifts we’ve noticed among large employers who have conducted a rethink of their redundancy programs and the way they communicate them.

Increased transparency in communicating plans

Some companies, notably those facing major disruption, are being more open in their communications about future operating structures, layoffs and workplace transition programs. For employers, this is a shift in tone and an acknowledgement that employees expect authenticity and transparency, and that workplaces are now subject to almost constant transformation.

Adoption of human-centred approaches and practices

The employee’s perspective is now front and centre. Smart companies are using human-centred research, training and content to lift employee engagement and influence success. This means that in some cases, the practical side of retrenchments is now managed by workplace transition experts, not just legal and HR generalists.

Elevation of employee safety and mental health

Organisations are increasingly aware of the mental and physical impacts that redundancy and job change can have on employees. We’ve seen some progressive white collar employers embracing safety and wellbeing programs similar to those in the resources sector for both responsible governance purposes and as a brand differentiator.

Recognition for departing employees

Good employers are giving retrenched employees an opportunity to say goodbye to their colleagues and offering genuine recognition for the contributions they have made. These firms clearly see the downside in ‘disappearing’ staff overnight and never mentioning them again. They also recognise the productivity losses that result from a failure to proactively engage impacted co-workers and other internal stakeholders.

Redefined working relationships

Companies increasingly understand that today’s former employee is tomorrow’s contractor, consultant, customer, competitor and industry contact. They’re also tomorrow’s Facebook commentator, Glassdoor reviewer or blogger. Burning employees with a bad redundancy experience now makes even less sense for an organisation’s reputation than it did before.
While we’ll suspend our judgement on concepts like ‘The Fourth Industrial Revolution’, we think the approaches and practices listed above raise key questions and decisions for senior HR leaders.

Written by Richard Roach, Senior Consultant, Transform.

IABC Gold Quill Winner – Australia Post career workbooks

According to IABC “Gold Quill winners represent a global community executing their responsibilities ethically and to the highest standards of the profession. These exemplary practitioners deliver high-impact results for their organisations and clients, taking communication to the next level.”

About the career workbooks

Free, confidential career coaching is available to employees through Australia Post’s initiative Post People 1st (PP1st). In 2015, in anticipation of higher demand for coaching due to accelerating business change, Post commissioned six career workbooks. The workbooks were designed for employees to self-service online, for managers to use with direct reports, and for PP1st coaches to use with clients.

What we did

Working closely with PP1st, Transform envisaged the structure, format and content plan for the six workbooks matched to Australia Post’s career pathways wheel and then went on to research, write and produce them. The workbooks were designed to be easy to read and navigate, interactive, hands on and practical, packed with useful information, worksheets, activities, inspirational quotes and more.

The result

In the first 12 months there was strong uptake with 48% (15,700) of employees downloading the workbook New Job Inside Australia Post and 19% (6,171) the other workbooks. There was a 12 point lift in the Net Promoter Score on coaching quality in the 12 months after the launch of the workbooks and an 86% increase in requests for coaching.

Our client says

Managers and employees at our facilities enjoy using these workbooks as a support tool to enable them to have better conversations with their staff. Our Post People 1st coaches encourage the use of these workbooks during their coaching sessions to encourage the employees to manage their own careers. Transform pitched them just right for our people, many of whom haven’t looked for a job for 10, 20, 30 years or more.
Karen Jacobson – Team Manager Post People 1st Careers, Australia Post

Find out more about Post People 1st.

About the Gold Quill Awards

For more than 40 years, IABC’s Gold Quill Awards have recognised and awarded excellence in strategic communication worldwide. The Gold Quill Awards honor the dedication, innovation and passion of communicators on a global scale with a focus on achieving solid business outcomes.

The IABC 2017 Gold Quill Awards will be presented at IABC’s World Conference, to be held in Washington, D.C. 11–14 June 2017. Find out more about World Conference.

Interested? Like to know more?

If you’d like to know more about this project or our employee and change communication services, contact Chris Dvoracek Director Transform on chris@transformcommunications.com.au or (+61) 3 9532 8342.

Communicating insurance changes

Communicating insurance changes to members means striking the right balance between compliance and promotion.

In response to increasing insurance costs, many funds have increased their premiums, changed their benefits or both. Communicating these changes to members represents an opportunity for funds but also potential risk.

Insurance changes are a valuable opportunity to promote the importance of your insurance offering to members and demonstrate the benefits of maintaining or increasing their cover.

The risk is that in promoting your insurance offering to members, you may not be providing all of the information needed to allow members to make informed decisions about their insurance cover.

Achieving a balance between compliance and promotion can be tricky. What can funds do to minimise this risk?

Minimise your risk

1. Be transparent
When communicating insurance changes, it may be tempting to focus on the benefits of your insurance offering and only mention details such as conditions and definitions in the fine print. However, by doing this you will miss out on the chance to build trust with your members by demonstrating your fund’s commitment to transparency.

You will also leave the fund open to potential complaints to the Superannuation Complaints Tribunal (SCT), such as case D13-14\085. In this case, the SCT found that a fund failed to provide the information “reasonably necessary for [the complainant] to understand the nature and effect of the change in insurance arrangements”.

Where the fund went wrong was in focusing on promoting the improved benefits that members would receive, without adequately explaining the conditions attached. Also, in the newsletter communicating the changes, important terms and conditions were put in a smaller font than the rest of the text and no attention was drawn to the importance of the information.

This case shows how vital it is to be transparent in not only what you say to members, but also in how you present the information. You need to ensure you include all of the relevant terms, conditions and definitions and give them equal prominence in your messaging.

Being transparent also means providing members with the context for the changes and a means of comparing what they currently have with what they will have.

Funds often provide the context for the insurance changes in a notice to members, which also includes an overview of the changes and an outline of the further communications and support to be provided. For example, the context for insurance changes in recent times has included changing economic conditions, increasing insurance costs, claims pressure and regulatory changes. Fund sustainability has also been a driving factor.

Personalised communications generally follow the notice to members. These clearly outline the impacts of the changes on the individual. In this way, members can understand what they have currently and what they will have after the changes. Transparency is again vital—members need to know exactly what any new premiums will cost them on a weekly, monthly or annual basis and how this differs from their current premiums.

2. Provide clear actions
Most insurance cover through super is provided on an opt-out basis, so unless members specifically opt out any changes to insurance will automatically apply. This means there is a real possibility of members paying for cover they do not want or need. Once you have explained to members what the changes are, you need to let them know what their options are and how they can contact you.

In case D14-15\161, the SCT found in the complainant’s favour because the fund’s insurance communications focused on how members could increase their insurance cover but provided little information on how they could decrease or opt out of the cover. This was seen as ‘upselling’ by the SCT and a deliberate attempt to make it hard for members to opt out of the new cover.

As this case illustrates, it is essential to provide your members with all of the actions they can take around their insurance cover—this includes how they can reduce or opt out of cover, not just apply for increases. You need to provide your members with the information they need to make an informed decision about what is best for their individual circumstances. This may mean encouraging members to speak to an adviser before making any changes to the amount or type of cover they have.

3. Brief your staff
All of your member touch points need to be considered in your communications strategy. This includes briefing your staff and ensuring your contact centre is fully across the changes and knows how to answer member enquiries. If your staff do not fully understand the changes, there is a risk they could provide members with incorrect information and, at worst, open up the fund to liability in the event of a claim.

In case D14-15\081, a fund was found liable to pay a member the difference between the insurance payout the member was actually entitled to and what a call centre staff member had advised the member they were eligible for. The amount was significant. The SCT found that the fund’s staff had not been adequately advised of the insurance changes, and in some instances did not even know a new policy was in place.

Make sure your staff are aware of what they can and cannot say to members and let them know where to refer members for further information, for example, your product disclosure statement (PDS), insurance guide, online portal or your advice team.

4. Call out the changes on benefit statements
In many instances, it may not be the communications about an insurance change that a member will rely on, but their benefit statement. Following an insurance change, revisit your benefit statement design to ensure that it reflects and, where necessary, calls out the changes to members’ insurance cover. Where possible, spell out any limitations or exclusions that may mean a member is not entitled to the cover listed in the statement.

In case D13-14\085, a member had received two successive benefit statements showing an insurance benefit amount. The member was not actually eligible for the benefit as they did not meet the conditions of the cover and wasn’t aware of this until a claim was made. The SCT found that a note in the statement referring members to the relevant PDS for conditions of insurance cover was insufficient. Having received two benefit statements showing the new level of cover, the SCT determined that “there was no reason for the [member] to refer to the PDS”, and the fund was directed to pay the stated insurance benefit amount.

5. Ensure your data is current
Crafting your communications is only half the battle. You need to make sure that your message reaches all of your members who are affected by the changes. This can usually be done by hard copy and email, depending on your members’ preferences and how your fund chooses to communicate with them.

In case D13-14\052, the SCT found that there were deficiencies in a fund’s insurance change communications as the fund had not “made reasonable enquiries as to the address or whereabouts of the complainant”. The fund had received returned mail from the member on a number of occasions and had put a hold on the member’s mail. The fund had no other way to contact the member (no email address had been provided) and could not prove they had made any effort to contact the member by other means (such as through their employer or by phone). The fund was found liable for the premium amounts paid by the member since the change was introduced.

Funds must be able to demonstrate that they have made reasonable efforts to ensure members have received their communications regarding important changes. This means if you send emails and get bounce backs, you need to show that you have tried to contact members by mail or telephone as well. Actions also include contacting employers where possible to get a member’s correct email or postal address.

Tips for communication

  • When communicating insurance changes to members, striking the right balance between compliance and promotion can be tricky
  • Provide an overview of the changes including context and benefit to members
  • Show the impact of the changes on the individual’s benefits, especially how new premiums will differ from current premiums
  • Outline relevant terms and conditions and define key terms
  • Provide details of how members can change or opt out of their cover
  • Ensure all of your member touch points are covered off
  • Direct members to where they can get more information.

These tips will help equip you to successfully navigate your way through insurance change communications and avoid the risk of your fund coming before the SCT.

IABC Gold Quill Winner – Post People First

In 2015 Australia Post’s PP1st team decided to refresh its Job Information Circular, a print publication used to advertise internal job vacancies. Prior to the refresh, the JIC was arriving late at interstate facilities and was time consuming to produce.

Transform developed a new content plan, look and feel, production process and workflow for the JIC to better meet the needs of employees and Australia Post. We reduced the production time by one third, automated the work process and introduced efficiencies while making the listings more user friendly and improving the visual appeal and overall quality of the content.

Member onboarding – are you missing the boat?

The first step in developing a lifelong relationship with your members is an engaging and effective new member process. Here we provide some insights into how you can refine your current process, including taking a look at what Mercy Super did and the benefits reaped.

First impressions count. Yet many super funds who spend plenty on member acquisition still send out lengthy, text-heavy welcome letters that do nothing to inspire new members and make them feel great about joining. These welcome letters are a tick in the compliance box rather than the first step in a lifelong journey of engagement with the fund.

So what can be done to engage members from the start? From working with a number of super funds, we know the onboarding process is an opportunity to:

  • provide a memorable introduction to your fund and what it stands for
  • encourage key actions that benefit the member and the fund
  • educate and explain super in simple, jargon-free communications, and
  • provide a user-friendly, personalised experience.

Working towards a better member onboarding process
In 2015, we worked with Mercy Super to establish a new onboarding process with a series of engaging, personalised communications for members during their first 12 months in the fund.

“We wanted to create a better experience for our new members; one that provides a positive start to their relationship with us”, says Craig Keath, Mercy Super’s Marketing & Communications Manager.

In working with Mercy Super and other super fund clients, we’ve put together a road map to help improve your member onboarding process.

  1. Map your existing process

You can’t improve your process until you know exactly what you have to work with.

Firstly, you need to get a clear picture of what your members experience when they join your fund. This includes all letters and other communications plus anything they receive via their employer. It’s also important to include your online join process and any emails that are generated.

You’ll also need to find out where the data for your current process comes from, what the mailing triggers are and who owns it within your fund (is it your operations team, administrator or other area of the business?).

It can take some time to put all the puzzle pieces together, but you’ll end up with a complete picture of your new member journey that includes process, content and responsibilities.

Key tip: Check whether you have metrics on existing new member communications such as open rates, responses and action. These can help you identify weak spots and opportunities to improve.

  1. Work with your administrator

Usually, the comms/marketing team will have the job of putting a new onboarding process in place. But your administrator may be responsible for issuing welcome materials and for workflow processes and CRM systems.

It’s important then to understand how the administration system works, what you can change and how, its limitations and opportunities. You may be able to refresh the existing letters and documents that your administrator sends, but may not have the scope to send emails or personalised mailings that have multiple variables.

This was the case for Mercy Super, so the fund opted to overlay a campaign process over the top of the administrator’s existing mailings.

“To get the level of personalisation and flexibility we wanted, we needed to design and send the campaigns direct from the fund,” says Craig. “This has allowed us to be more agile in tracking and adapting the process along the way”.

Key tip: Make sure you work with your administrator to explore your options. Some changes to workflow may take time to implement and may need to go through a series of approvals.

  1. Check in with your key employers

Funds work hard for their default status, but may not be getting the most out of it. Some employers hand out information to new employees for multiple super funds or may encourage new employees to bring their existing super fund with them. This means your employers may not understand the default process or the benefits to their employees of joining your fund.

Take the opportunity to speak with your key employers and to identify new opportunities to communicate with their employees. Ask whether you can add material to their letter of offer pack, participate in staff information days or attend pre-employment events.

Where possible, track metrics – how many employees join your fund from the prospective pool of new employees? This information can be used to help you set some goals for acquisition.

Key tip: Don’t assume! Ask questions and find out how your employers talk to new employees about your fund.

  1. Determine your key actions and timing

Work out what actions you want to encourage and how you want to communicate them to members. Focus on simple, easy to understand communications that clearly explains why members should care enough to take action.

For Mercy Super, the key activities for new members include online account login, member contributions, search consent, rollovers, getting financial advice and nominating beneficiaries. These topics are explained using case studies and examples, with clear calls to action.

“We want our members to have a personalised experience that matches their needs,” says Craig. For Mercy Super, this means sending communications with variable information that is tailored to a member’s situation and that builds on their past actions.

While not all funds will have this capability, it’s worth exploring your options around personalisation. For smaller funds, a personalised approach may mean picking up the phone and talking to new members.

Lastly, make sure the medium fits the message – for example, online login lends itself to email rather than hard copy. You can use AB testing to determine which delivery methods gets the best results.

Key tip: Think outside the box when it comes to ways you can improve your member experience. Try outbound calls or personalised videos to welcome new members to the fund and encourage engagement.

  1. Review. Refine. Repeat

Once you’ve bedded down your new process, you need to track performance.

Mercy Super uses a range of measures to track the performance of their new member process. This is largely based on member activity in each of the areas related to communications and covers all member touchpoints. The fund also tracks the behaviour of new members against that of their existing member base.

To capture and collate this data, you need to flag campaign activity and action on an individual’s record, which is something not all funds have the ability to do. It’s worth exploring how you can track this data in your own fund.

Craig says, “Since we’ve introduced our new member onboarding process, we’ve had a significant increase in search consents, rollovers and interaction with our contact centre and advisers. However, we haven’t had as much lift with beneficiary nominations. This is one of the areas we’ll look at as we refine our content”.

Key tip: Don’t set and forget! Identify and keep track of your key metrics. If something isn’t working, change tack and refine your approach.

Summary

An effective new member process will evolve over time as you factor in new mediums, technologies and sophistication in terms of personalisation.

“We’re always looking at ways we can move forwards and improve our member engagement”, says Craig. For Mercy Super, this improvement consists of exploring new mediums and channels, such as personalised welcome videos and tailored pre-employment communications.

Having an engaging and effective new member process is good for funds and members. It’s a valuable opportunity to educate members and encourage them to make good choices about their super. Plus, it’s the first step in a lifelong relationship between you and your members.

5 ways to a winning Rem Report

Tempted to simply dust off last year’s Remuneration Report and update it with this year’s figures? After all, it got a ‘yes’ vote last time, so why not?

For one, shareholders and proxy advisor groups are increasingly looking for clear messaging around incentive pay structure and targets and how they link to business strategy. And they’re looking for evidence that pay aligns to performance, particularly for the CEO. And that’s not all.

If you’re looking to ensure your 2016 Remuneration Report stays on track for that all important ‘yes’ vote, here’s a checklist to help guide your efforts.

1. Evidence your remuneration strategy links to business strategy

Show how incentive pay measures and targets link to business strategy. You might, for example, list your strategic drivers and show how they are reflected to STI and LTI performance measures. Bonus points if you can show that incentive performance periods align with your strategy timeline.

2. How Company performance is reflected in reward outcomes

Performance down on last year? Then are remuneration outcomes for your executive team (particularly the CEO) down as well? Performance up? How has that translated into increased reward outcomes – and do the percentages tell a credible story? For example, if NPAT performance was 134% of target and the average STI award was 130%, you’re demonstrating strong alignment. What you’re wanting to show is that actual performance directly drives what executives are paid.

3. Rationale behind your reward structure and framework

Here’s where you might talk about what your marketing positioning is and why, what the mix is between fixed and ‘at risk’ reward, show how your approach encourages executives to build and retain shares (and have skin in the game) and how you have a multi-year focus.

4. Address changes in arrangements, potential hot spots and issues

Made changes – why? What’s the rationale – and how did those changes strengthen performance-reward linkages and/or benefit shareholders? What questions did shareholders or investors ask last year – and have you addressed them in this year’s report? Brainstorm what questions you’re likely to get. This is where you want to get on the front foot and pre-empt.

5. Clear messaging, infographics, tables and other visual aids

Graphics that show Average STI over 5 years mapped against operating earnings. Infographics that spell out the elements of your structure and how the align to key business drivers. Tables setting out your executive team and what they got paid for each reward element and the performance metrics that applied. There are many devices you can use to tell your story in a compelling way – the key is not to get stuck in complex technical language and fail to get a clear, consistent message across.

Get in touch

Phone +61 3 9532 8342
Email admin@transformcommunications.com.au
Mail PO Box 316 Elsternwick VIC 3185 Australia

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