Sunsuper chief executive Tony Lally has outlined a fresh template for industry super funds - one that moves towards providing high-tech and more customised low-cost advice services to members.
Speaking at the Association Superannuation Funds of Australia (ASFA) event yesterday, Lally said the challenge for industry super funds is to provide a more comprehensive personalised service to members.
To achieve this new business model, Lally proposed a different advice model that can provide limited amount of information for members.
"We see a lot of members join industry funds because of the low cost. They know what they want, they don't want a full financial plan, they simply want a solution for their retirement needs," he said.
"It's having a modular advice model which can simply answer these questions for members."
In addition, Lally said super funds must spend more on technology to provide a seamless system where members can easily contribute and switch.
"It's going to take a few leaders to strike out and build these systems like the banks who've built their own systems and then connected them. You can now go to any bank and take out your money," he said.
"The advantage is if you make it simple it will be far more attractive to employers and more attractive to members. It will encourage additional contributions and it'll be easier to use."
Lally said Sunsuper has the scale and expertise to adopt the measures he outlined. "I'm confident our business will be able to do it. We have the budget, we have the skills and that's all you need. It's not cheap, it's going to be expensive but it needs to be done," he said.
The test for industry super funds is to keep costs low and provide more services, Lally said. "I believe the industry funds can build up to this service It's far easier for the industry funds and the corporate funds to build up to it than it will be for retail to build down from where they are," he said.
"There are too many hands in the till and some people would have to be cut out for that to happen."
