Retirement Investment Industry Facing Great Change, Experts Say
'Retirement' Term Seen As Outdated
Companies Embracing AI
But Singer noted a dichotomy in how technology advances in the industry are being perceived by different sectors. Recent surveys, including a live poll taken at the presentation, showed a majority of retirement investment executives believe technology companies will disrupt the industry. Fintechs invading the space, however, maintain they want to be partners, rather than true competitors.
“Look at the experience of the technology companies had when they said they were getting into healthcare,” Singer said. “When faced with the compliance and regulatory complexities, they withdrew.”
Instead, he said, technology companies can offer advanced platforms to ease the sales process and experience in ways current generations are now used to when dealing when interacting with corporations. He used companies such as Travelocity and Kayak as examples. Those firms don’t provide travel or vacation packages but provide an easy-to-use platform for consumers to book their trips.
Fintech: Partner Or Competitor?
“We see the fintech’s partnering with us for the platforms,” said Bryan Hodgens, corporate Vice President and director of distribution and retirement research for LIMRA LOMA. “They’re not going to compete on product but on platform and process.”
Hodgens said fintechs, then, can be both partners and disruptive, but not necessarily in a bad way.
Ongoing technology disruption of the industry is inevitable but big tech can be viewed as an enabler rather than a competitor, Singer noted.
The consumer is really the driver of much of the change affecting the industry, as investors seek personalized outcomes at speed, cost, and scale, he said.
Experience Is The New Product
“Experience is the new product,” Singer said, referring to a chart displaying takeaways from several E&Y “innovation studio settings.”
Under “experience” as the new product, E&Y found:
- Holistic advice providers will prevail
- Platform ecosystems will disrupt and control the client experience.
- Choice and personalization will lead to better engagement.
In the perhaps warmer and fuzzier categories of impeding change, Singer said companies that embrace diversity, equity, and enhanced culture objectives, show improved earnings,
“Culture and strategic growth are intertwined,” he said. “Diverse and innovative cultures transform companies.”
Silks noted there are currently five generations of people in the workforce, creating the need for what is often considered a staid industry, to evolve.
“Product evolution will have to occur,” she said and we consider ourselves in the crow’s nest of a ship looking ahead to what coming in consolidations, partnerships and technology.”
Doug Bailey is a journalist and freelance writer who lives outside of Boston. He can be reached at [email protected].
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