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Spilt Milk Syndrome & Corporate Super

The Symptoms

Unfortunately most employers and their managers sometimes realise too late that they were infected by the spilt milk syndrome.  There are no visible symptoms but you do feel the effects sometimes later when you identify a missed opportunity of some significance.    Some managers never own up to having spilt milk syndrome, as it is not of benefit in managing a stable and positively developing career.  Other managers just never realise they actually have the syndrome long term and let’s say many opportunities just pass them by.

The Employer Brand & USP

Almost every employer will expend a great deal of effort in promoting their products or services to their target market.  Clearly every employer intends to be both competent and efficient in delivering their products or services to their customers with the cost and quality dependent upon the performance of their workforce.  This involves many initiatives in stabilising and motivating all employees to be proud of their company brand.  Is every employer taking advantage of every opportunity to ensure the overall efficiency of the operation they run?

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Super is indeed one of the major missed opportunities for most employers in their attempt to change the dialogue between employer and employee to one of common interest. 

Where Does Employer Super Fit In?

Super in its totality has been a problem since its introduction almost 30 years ago.  Every time the government decides to examine various aspects of the financial services industry, there is another raft of regulation imposed upon an asset which therefore appears to be badly set up, developed and managed.  

The frequency and volume of re-regulation around super in itself suggests that it has never been fixed and will continue to be a problem. 

What’s the Problem with Corporate Super?

We all have a share in what is going on around super as a personal asset fully funded by your employer. So, who is doing the wrong thing or sometimes not quite the right thing?

o   Financial services companies that sell product but do not fulfil their service promises

o   Employers who do not have the internal expertise to manage super, nor do they access a qualified service to assist them. 

o   The most dominant adviser models involve financial planning and accountants, all of which are expensive and out of reach for most employees

Interesting & Undisputed Facts

AXIS provides an initial service to employers involving a clear analysis of the current arrangement, known as a Service Model Analysis.  This involves asking your product provider to complete and return a questionnaire to AXIS examining their value proposition and how it has been delivered.  One has to understand the nature of the problem and what might be the appropriate solution as distinct from changing your product provider but not fixing the actual problem.

The Service Model Analysis examines:

  1.     Your Product Provider’s Value Proposition

Usually promises actions by the product provider which will lead to optimisation of individual balances.

  1.     Employer Service Promises

There are promises of a dedicated relationship manager who is supposed to organise an annual strategy meeting to agree what are the service targets for the next 12 months.  Clearly such performance targets should be monitored and reported on.

  1.     Employee Service Promises

Generally speaking, employees are offered general advice as distinct from personal scaled advice as members of the corporate plan.  The distinction between general and personal advice is never made clear.  Master trusts have a different sales model (as distinct from service model) and most see corporate super as a farm from which they harvest high value financial planning clients from.

  1.     Own Product

All product is designed with the product provider’s revenue in mind.  Product providers do not fully disclose the revenue raising structure within their product.  Armed with some additional information you can examine the product provider’s sales model and understand how they manage their own profit generation in spite of them failing the expectations of most plan members.

  1.     Service KPI’s

Product providers will not want to report anything that shows them up in a negative light. You have to know what makes a difference for super to be regarded as a remuneration benefit of high quality.  Every individual in a workforce should have an effective service structure around their individual super account:

o   Know your product and understand the fees and premiums

o   Know your goals and objectives in terms of age of retirement and planned income in retirement

o   Understand the importance of having measures that give you control in examining asset performance

o   Make sure you have an appropriate strategy for both your level of contribution and also your investment return

  1.     Erosion of Contributions

Fees within a corporate plan do erode each employee’s annual contribution and every employer appreciates knowing who is most affected. 

Only a small proportion of any working population want holistic financial advice and most people are between misinformed and uninformed about their super.  Employers do have an opportunity to discover what is required to understand super as a superior remuneration benefit and consider what level of service model best suits their workforce.   

Product providers only create a product and that has become the limiting factor in their definition of service.  Most employers perceive some benefit in having a corporate plan but most employers do not know how to derive the optimal benefit in terms of value delivered to each individual employee.  

This document was prepared and issued by AXIS Financial Group (ABN 21 092 889 579, AFSL 233680). The information contained within it is not advice. It provides general information only and does not take into account your individual objectives, financial situation or needs. You should assess whether the information is appropriate for you and consider talking with your financial adviser before making an investment decision. Information in this publication, which is taken from sources other than AXIS Financial Group, is believed to be accurate. However, subject to any contrary provision in any applicable law, neither AXIS Financial Group, nor its employees and directors, provide any warranty of accuracy or reliability in relation to such information or accepts any liability to any person who relies on it.


Mitsui & Co. (Australia) Ltd engaged AXIS Financial Group in reviewing the existing employer super arrangements and clarifying which product provider might be best for Mitsui & Co. (Australia) Ltd and it’s group of companies.

AXIS Financial Group provided a concise explanation as to who might be best and why, in particular ensuring that the internal project team had the information to feel confident as decisions were made. The project team moved from arguably being daunted by the prospect of improving this particular employer funded employee entitlement and better understood how to manage super as a remuneration benefit through the detailed analysis and explanation provided by AXIS Financial Group

Antony Auliso
General Manager - Human Resources Division
Mitsui & Co. (Australia) Ltd

I want to thank AXIS Financial Group for their efforts in handling insurance claims on behalf of the employees of WesTrac. From the moment AXIS Financial Group were appointed to the task, they moved so seamlessly into position and have made sure that WesTrac is not only better serviced as a result but also more informed about claims progress. I also note the outstanding results achieved by AXIS with respect to marketing and placement of our employer super policy.

It seems nothing is a problem for the AXIS team and I would commend all employers to consider this service.

Gary Carter
Group Insurance Manager
WesTrac Pty Ltd

AXIS Financial Group’s knowledge of employer super is second to none.

DXC tasked AXIS Financial Group with consolidating multiple superannuation funds to a
single company-wide default fund. They delivered, displaying superior knowledge of their
industry, along with the highest level of service and diligence.
From start to finish – the initial analysis of our previous funds, the detailed tender process,
the transition to our new fund, and post-transition – AXIS Financial Group always made
themselves available for support.
We strongly recommend speaking to AXIS Financial Group for all matters relating to
employer super.

Michael McGoldrick
Director, Compensation Asia Pacific
DXC Technology