Success Story: SuperChoice

Automation clears up confusion of complex pension funds

  • Headquarters

    Sydney, Australia
  • Industry

  • Challenge

    To automate the flow of pension fund transactions, consolidate disparate point-to-point connections onto a single platform, provide support for AS4/ebMS v3, simplify and improve operations management, and reduce the cost of managing customers

  • Solution

  • Results

      • Support for AS4/ebMS v3, as mandated by Australian government requirements
      • Significantly lowered implementation risk and cost
      • Consolidation of disparate point-to-point connections onto a single platform
      • Major uplift in administrative/operational support

      Description

      SuperChoice is Australia’s e-commerce leader for automating pension fund transactions and payments. SuperChoice provides Australian employers and pension funds with a cloud-based pension-fund management and clearinghouse service that automates the flow of pension fund transactions. In operation for more than 15 years, SuperChoice today serves over 100,000 employers, nearly 3 million employees, and thousands of pension funds.

          Spearheading a nationwide initiative

          In Australia, costs for processing pension fund transactions and contributions have been rising swiftly, both due to the prevalence of manual processing, and because of the extraordinary diversity and number of pension funds available to Australian workers.

          Half of the nation’s 100 million pension contributions made each year are currently processed manually, incurring a massive cost that severely undercuts the payout available to employees upon retirement.

          Meanwhile, Australian employers frequently offer a variety of company-sponsored “Default” funds together with “Choice” funds selected by the employee. In addition, there are over 500,000 Self-Managed Super Funds managed by one to four workers. A typical large employer may have to contribute to thousands of different funds, engendering enormous complexity and cost.

          To address these issues, The Australian government launched SuperStream, a groundbreaking program designed to automate the pension fund system and reduce the cost of pension fund processing by up to A$1 billion per year. SuperStream imposes the use of a new communications standard, AS4/ebMS v3, with a strict timetable for rollouts of the information exchange.

          Getting ready for SuperStream

          SuperChoice looks for answers

          The Australian Tax Office set the first SuperStream deployment for July 2013, targeting rollovers — the transfer of employee pension savings from one fund to another. Faced with that deadline and others looming soon thereafter, SuperChoice had hard decisions to make.

          “We didn’t have AS4,” said Ian Gibson, Chief Information Officer of SuperChoice. “We needed to be able to support it, and we had to do it in a reliable, cost-effective way. We also had to upgrade our administration capabilities,” he continued. “We used bespoke administration, which had become very costly for us. Historically, we built everything ourselves.”

          To test their options, SuperChoice developed a pilot ebMS v3/AS4 solution, based on the Holodeck open source kernel. The plan was to get it operating in their environment and build out functionality to support SuperStream requirements. It quickly became clear that an in-house solution would come with high risk. “We saw that delivery timeframes were far too long, and our initial cost estimates to build out functionality were way too low,” said Gibson.

          Getting Ready for SuperStream

          SuperChoice looks for answers

          The Australian Tax Office set the first SuperStream deployment for July 2013, targeting rollovers — the transfer of employee pension savings from one fund to another. Faced with that deadline and others looming soon thereafter, SuperChoice had hard decisions to make.

          “We didn’t have AS4,” said Ian Gibson, Chief Information Officer of SuperChoice. “We needed to be able to support it, and we had to do it in a reliable, costeffective way. We also had to upgrade our administration capabilities,” he continued. “We used bespoke administration, which had become very costly for us. Historically, we built everything ourselves.”

          To test their options, SuperChoice developed a pilot ebMS v3/AS4 solution, based on the Holodeck open source kernel. The plan was to get it operating in their environment and build out functionality to support SuperStream requirements. It quickly became clear that an in-house solution would come with high risk. “We saw that delivery timeframes were far too long, and our initial cost estimates to build out functionality were way too low,” said Gibson.

          Choosing the Axway solution

          Bringing all B2B communications under one umbrella

          SuperChoice then began seeking a third-party solution. Most vendors would not commit to the deadlines SuperChoice had to meet. “Axway was different,” said Gibson. “They looked at it from our perspective. They asked, ‘What do you need, and when do you need it? We’ll figure out how we can achieve that for you.’”

          “We had the opportunity to play with the Axway solution,” said Gibson. “We did a bake-off, comparing our in-house pilot to the Axway pilot, and Axway’s solution compared very well. We were comfortable it was a quality product.”

          “The advantage of going with Axway was that we could bring all our B2B communications under one umbrella, and we would get a significant uplift in administration quality and cost-effectiveness,” said Gibson. “By deploying Axway B2Bi, we could leverage the AS4/ebMS expertise of a dedicated B2B communications player.”

          SuperChoice and its ecosystem

          Providing a gateway for employers and pension funds

          Under SuperStream, all pension funds (called “superannuation funds” in Australia) and all employers are required to send and receive pension fund transaction data and contributions using AS4 for communications and ebMS v3 for messaging.

          Instead of doing so themselves, however, they can delegate this responsibility to specialist providers: gateways that stand in the middle of the two parties. All of Australia’s 350 largest pension funds decided to use gateways, as has most of the 300,000 active Self-Managed Super Funds. Virtually all employers do the same.

          Depending on the configuration, SuperChoice can:

          • Act as a gateway to translate and route pension data, working either on the employer side, the pension-fund side – or both sides of a single transaction
          • Act as a clearinghouse to process pension contributions, on the employer side or pension-fund side — or both
          • Act as both gateway and clearinghouse for employer and pension fund alike

          It’s a critical role for all the players. “One employer we work with sends payments to 4,000 different pension funds,” said Gibson. “That’s a huge amount of complexity for employers to deal with.”

          The Axway solution at work

          Consolidating disparate point-to-point connections

          Describing the role of the Axway solution in the SuperStream environment, Gibson explained: “The Axway solution gives us out-of-the box support for a full range of SuperStream-relevant communications protocols including ebMS v3/AS4. It also supports ‘any-to-any’ transformation of a wide range of document formats.”

          “Using the Axway solution,” he continued, “we can consolidate all our disparate point-to-point connections onto one platform, simplifying and improving operations management while reducing the cost of managing customers.”

          “Right now, we handle 28 million electronic transactions per year, and we expect to be processing some 40 million by 2016,” said Gibson.

          Since going live with SuperStream in July 2013, SuperChoice now:

          • Provides online contribution processing systems to over 40 percent of Australia’s largest pension providers
          • Handles contributions from over 100,000 employers on behalf of nearly 3 million employees
          • Processes an estimated 56 percent of all electronic pension fund contributions from employers
          • Handles nearly 20 percent of all contributions to active Self-Managed Super Funds (These are similar to Personal Pension Schemes in the UK and Self-Directed 401Ks in the U.S.)

          “Selecting Axway has enabled us to achieve real, tangible benefits.”

          Ian Gibson, Chief Information Officer, SuperChoice

           

          Ramping up production

          Ensuring high availability and scalability

          As part of the ongoing rollout of SuperStream, the first group of large employers went live in July 2014. In tandem, SuperChoice is ramping up production to handle the increased transaction volume, while working to ensure even better performance. “We’re fully virtualizing our underlying environment, which will give us an internal cloud-like capability,” said Gibson. “We’re also looking to implement Axway active-active clusters.”

          “We’re going to do a comprehensive, fully clustered implementation of Axway B2Bi across a number of environments,” he said. “We’ll wrap the Sentinel implementation around that.”

          SuperChoice is using Axway B2Bi to perform end-to-end monitoring of all transactions and to govern the flow of data. Based on the data generated by Axway B2Bi, SuperChoice is using Sentinel to create customized reports for customers, which are in great demand.

          “We’re now getting a great amount of transaction data from the Axway solution,” said Gibson.

          “Sentinel is a fantastic product for giving us a lens into that data. I think that there are some quick and compelling wins for our business out of that.”

          Real, tangible benefits

          Substantially upgraded capabilities

          After 18 months in production, SuperChoice is thrilled with the solution. “Selecting Axway has enabled us to achieve real, tangible benefits,” said Gibson. According to the CIO, these include:

          • Significantly lowered implementation risk and cost
          • A major uplift in administrative/operational support
          • Consolidation of disparate point-to-point connections onto a single platform
          • Substantially upgraded capabilities, with an ongoing stream of functionality improvements
          • Rigorous security framework, including a DMZrouter, which can be leveraged for use throughout the broader SuperChoice IT environment
          • Drummond certification

          “It’s clear that Axway was the only viable option for us to handle the number and complexity of transactions that SuperStream entailed,” remarked Gibson.

          Looking ahead

          The future of business-to-government transactions

          SuperChoice is about halfway through the deployment of SuperStream. But the pension system is just one side of the story: the Australian Government is now migrating all business-to-government (B2G) transactions onto the SuperStream ebMS v3/AS4 network. “That’s why the Axway B2Bi capability is so critical: it will provide the basis for all B2G reporting and transactions and SuperChoice the opportunity to expand outside the pension system,” said Gibson.

          “Moving forward, our strategy is to leverage the Axway B2Bi platform to consolidate all our existing bespoke solutions,” he said. These include in-house solutions for web services, MQ and SFTP connections, and CLEO for their AS2 connections. “Axway enables us to consolidate these in-house and proprietary solutions onto a common platform, and obtain the functionality and administrative benefits that Axway delivers for AS4,” said Gibson.

          SuperChoice is also leveraging the Axway B2Bi security framework, including its DMZ-router, taking advantage of its capabilities in their main systems environment. “All of this will give us huge benefits in terms of ease of administration. Already, we’ve seen a major uplift in capabilities, along with a reduced effort needed to manage the overall environment.”

          “With Axway as our SuperStream partner,” said Gibson, “we can focus on our core mission to fully automate pension fund transactions, confident in the knowledge that Axway is focused on the information exchange platform and on compliance with standards as they evolve.”

           

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