BT Westpac ‘Super for Life’

Australia has one of the most advanced retirement savings programs in the world, known as Superannuation or “Super”. Employer participation is mandatory, with contributions currently set at nine percent of wages. As a result, Australia’s funds management industry has become the fourth-largest in the world based on dollars managed – a startling and impressive fact given the country’s population of just over 20 million.

In spite of having this world-leading savings program, however, until the last couple of years, Australians had little control over their superannuation accounts and little incentive to contribute their own funds to these savings, in addition to their employers’ contributions.

Employees had no choice as to who would manage their funds; employers selected the management company. Nor, with few exceptions, did employees have online access to track fund performance or alter their asset allocations. Without any ability to choose or easily manage their own accounts, employees typically paid little attention to them. Often investments weren’t moved as employment changed, and it became nightmarish to keep track of six, seven or perhaps more accounts managed by different firms, not to mention the expense of having multiple funds.

Legislative changes open the market

The situation changed dramatically beginning in 2006. New legislation gave consumers the right to choose which company would hold and invest their Superannuation; no longer were they stuck with their employer’s choice. Following closely on this change, further tax incentives were granted to encourage consumers to contribute from their own pockets on top of the mandated 9% employer contribution. With these changes, the retirement funds industry was about to become much more competitive and driven to innovation.

The huge amount of funds already under management now up for grabs meant that whoever offered the Super product with the best service, management and price stood to gain market share over rivals. In addition, retail for-profit funds (as compared with union-initiated non-profit “industry” funds) were under pressure over the widespread practice of paying “trailing commissions” to their financial planners, which an increasing number of industry observers alleged caused bias in product recommendations.

Faced with these challenges and opportunities, BT Financial Group , the wealth management arm of Westpac Bank, Australia’s largest bank, decided that half steps to compete just wouldn’t do. They set up the ‘BT Super for Life’ initiative.

“We saw strong consumer demand for increased transparency and better online services, and we were determined to be the first provider to deliver these to customers.” said Catherine Galton - Head of Product, BT Super for Life.

If they could introduce a product designed from the consumer’s point of view that offered easy online access, low administration fees and no hidden trailing commissions, BT knew they would gain retirement accounts from rivals. Better yet, if they could build a system that was integrated with Westpac bank accounts and products such as credit cards and insurance, BT and Westpac knew they could make this a huge competitive advantage for the entire firm.

Over 70 systems to connect

BT spent the next six months putting details to their vision for the new product. In addition to online funds management and allocation, customers would be able to obtain Life Insurance products, access their Westpac bank and credit card accounts, convert loyalty points into super dollar contributions, specify external accounts to be consolidated into BT Super for Life, and much more. Nobody had a feature set close to this – yet. But BT knew others weren’t standing still either.

It was going to be a massive project. Customer-centric design was required to ensure an intuitive user interface. But the biggest part of the job was going to be integration: linking with over 70 Westpac and third party systems, including mainframe core banking, unit registry and pricing systems, bank customer information and customer relationship management systems. Many of these systems had never been integrated before; some still included manual processing steps. A Service Oriented Architecture would be required, using web services to allow loosely-coupled yet rich integration of these systems.

About this time, ThoughtWorks completed a project for another group at BT and word of mouth was spreading about the high quality of work completed in a short time span. BT’s Super for Life team began to work with ThoughtWorks to see how they might adopt some key Agile processes, such as Test Driven Development and Continuous Integration, to better ensure code quality.

“Our team, which was spread between Sydney and Bangalore, employed Agile development techniques, demonstrating working software to our client every two weeks. Continuous feedback and collaboration allowed us – and BT – to evolve our ideas and innovate throughout the development phase.”

Keith Dodds - Director of Sales and Marketing, ThoughtWorks

Winning on quality, delivering on innovation

Increasingly impressed with ThoughtWorks’ expertise and processes, the BT Super for Life team asked for a bid on the entire project. ThoughtWorks responded with a proposal that took advantage of its offshore Agile development organisation in India, and got the job.

The joint team began work immediately, with the business team working hand-in-hand with the technical team onsite and creating the requirements stories for the entire project. The offshore team ramped up and grew to over 25 ThoughtWorkers. Members of the Sydney and Bangalore teams traded site visits to increase communication and information flows.

The Super for Life team was particularly impressed with the transparency to progress that Agile gave them, even when everything wasn’t smooth-sailing. Part-way through the first release, it became clear that there was too much scope to be delivered by the desired launch date and that cuts would have to be made to meet time-to-market drivers. Even then, the visibility and granularity of the requirements, gathered in discrete “user stories”, made it easier for business sponsors to identify what functionality could be deferred to future releases or simply cut.

Award-winning simplicity

Nine months later, the BT Super for Life project was launched to consumers with first-in-the-market features. Within two weeks it garnered significant industry recognition by winning the SuperRatings Fund of the Year award for Best New Product. “In a move to inspire copycats, Westpac has become the first major bank to put its weight behind a simple and inexpensive super product connected to an online bank account,” reported Melbourne daily newspaper The Age. Westpac Bank’s CEO hailed the high-profile project: “We have a first class product (indeed a “best in class” product) in BT Super for Life”.

In Year One after launch, the BT Super for Life product garnered more than 80,000 new customers and $283M in funds under management.

“The agility of ThoughtWorks and their focus on delivery was fundamental to BT being able to create this revolutionary Super product. We are passionate about making it easier for Australians to own and manage their life savings, and with the advantage of our ThoughtWorks partners, we've been able to make the vision a reality with BT Super for Life”

Catherine Galton - Head of Product, BT Super for Life.

BT Super for Life has gone on to win Australia’s iAward 2008 for technology innovation and best in financial services, the 2008 Rainmaker award for best website and a global CIO 100 Award, which honors 100 companies globally for excellence and achievement in IT.

BT/Westpac and ThoughtWorks continue to work in partnership on new products to benefit consumers.

Benefits:

• The project delivered first-in-the-market features for consumers nine months after starting development.
  

• Over $460M new funds under management and 120k new customers for BT since launch.
  

• Integrating over 70 internal and external systems in the nine-month timeframe brought BT / Westpac a true competitive advantage.
  

• BT Super for Life offered the first feature-rich combination of online banking, retirement savings and insurance to Australians.
  

• The product has garnered BT numerous awards and recognition for being consumer-friendly with a low-cost, easy-to-use online product.
  

• Test driven development and Continuous Integration kept the quality of the code high despite the complexity of the underlying integrations.
  

“Super for Life was a massive undertaking for us, but it set the new standard for Superannuation products, and particularly the customer’s online experience. ThoughtWorks was indispensable to our ability to launch such a complex system so fast.”

Catherine Galton - Head of Product, BT Super for Life

Technology: Java, Web services, Tibco