FIA strategic Planning workshop

1. FIA strategic Planning workshop 8 October 2010 & 20 January 2011 Leriba Lodge and Country Club Johannesburg Facilitated by: Alan Kirschner

2. Purpose of workshop • Review progress in implementing the Feb / Sept 2008 strategic plan. • Start the process of developing a 3 to 5 year strategic action plan of the FIA We are talking strategy…

3. Overall strategic planning process... Today: everybody will have input here Current reality? Our Charter Purpose Focus Areas? Next month: Based on your input, Exco will identify key focus areas and action plans How? i.e. Action plans

4. Strategic alignment

5. FIA Charter We are a recognised professional organisation representing our members with a code of conduct governing our behaviour. We exist to serve our members and promote our image through industry representation and the provision of services including the development of the intermediary market.

6. The FIA’s primary Purpose:- We represent, protect, promote and further the common interests of our members.

7. Current reality • Review of 2008 strategic initiatives • Feedback from preliminary stakeholder research • Feedback from Epic research • Advisory Council views – • Hindering factors • Helping factors • Trends…

8. Review of 2008 strategies • Three strategic focus areas • Structural Blueprint & Design • Communication: Internal and External • Image and influence

9. Focus Area: Structural Blueprint & Design Definition of Success • All members (Corporates and individuals) recognise the value of FIA membership (The need for development and clarification of value proposition) • Highly competent individuals in the secretariat with limited dependence on volunteers, efficiently executing agreed action plans • Clarity on membership categories/structures, voting rights and fees • A recognised umbrella body exists (yes) which consists of all financial services intermediary bodies in South Africa (not there yet) • We have efficient and effective structures (including committees, divisions, branches) which meet the needs of members across the country • An effective performance management process is in place for all staff members • Effective and regular communication internally and externally occurs during the blueprint rollout

10. Focus area: Communication Plan • Definition of Success • Timeous and effective two-way electronic communication with all our members • Our members are well informed about FIA and relevant industry issues • Timeous response from FIA to specific member concerns • An annual road show/conference for members/potential members (more work needs to be done for potential members) • Positive feedback from members on our communication • Existence of communications database which includes appropriate employees of member companies (needs work for larger member organisations) • FIA seen as a proactive, valued, regular contributor and participant with financial press and industry bodies • Positive column inches on FIA

11. Image and Influence • Definition of Success • Recognised by regulators, legislators and government as the voice of intermediaries (great strides; must continue the work with Treasury and government) • Consumer knows the value of dealing with intermediary (no) • Product providers make membership of FIA a preference of granting agencies (great strides in the short term and health space. Others no) • Sound and healthy and productive relationships with SAIA (yes), LOA/ ACI/ ASISA (patchy), Inseta(great strides), IISA(yes), FPI(yes), Council for Medical Schemes(yes) etc... valued by them

12. Stakeholder research (preliminary) • Respondents • Viviene Pearson (GM sustainability), SAIA • Godfrey Nti (CEO), FPI • Sandra Dunn (CEO), Inseta • Anna Rosenburg (Senior Policy Advisor – insurance and regulatory issues), ASISA • Barry Scott (CEO), SAIA • Jonathan Dixon (Director – Insurance), FSB • Gerry Anderson Acting Deputy Executive: Market conduct and consumer education • Peter Dempsey, Dep CEO ASISA. • Peter Stephan (Senior Policy advisor – marketing and distribution), ASISA • Mr Craig Burton-Durham – Council for Medical Schemes – couldn’t find suitable date.

13. What are the biggest challenges facing the FIA 1? • Building a bridge between the very different needs and interests of the small and large brokers • Helping most members understand the broader issues affecting the industry • Providing value to membership base - members want FIA to provide everything in the sector. I.e.. Keeping members happy in terms of value proposition • Dealing with regulation - I'm happy with the way they engage with policy makers (they also engage early)

14. What are the biggest challenges facing the FIA 2? • It is not yet seen as the priority organisation to represent brokers and broking / corporate entities. • There are a lot of individual corporate entities that do not belong to FIA. • Make sure that the value of independent broker advice is properly appreciated by the consumer vs direct market. Note: There should also be a clearer distinction between independent brokers & tied agents. • Internally: Wrong structure and people. Less than complimentary about the value & depth of FIA executive. Some are out of their depth and others don’t add value to industry at large. • Externally: Need to get involved in national debate and in the future of industry – not just brokers. • They have a broad congregation – creates challenges in meeting v. different needs. • Limited no of paid office bearers – need to rely on regional volunteers. How to make the industry attractive to young people – average age of advisors is 53. • Require a different regulatory environment to access low income section of society. • Increasing regulation adding to admin and cost burden of advisors.

15. Communication improvements 1 • Need more knowledgeable specialists who participate and give leadership input and substance (like Barry Taylor) • Need more formal (quarterly) meetings

16. Communication improvements 2 • More structured quarterly meetings to track agenda items. Most useful if it is two way. What do FIA see as strategic imperatives. FSB and ASISA • Improve quality of input and take broader view. • Raise key challenges, trends & issues affecting intermediaries in standing committee. • Send PD & PS copies of FIA newsletter • Need for more formalised meeting with PS and ASISA. Esp. marketing distribution board committee. Meet 1 week prior to fixed meeting to ensure FIA voice is heard in meetings. Dates in report. • Provide copies of FIA submissions on regulations to ASISA & vice versa.

17. Overall when you think of FIA, in what areas would you say they excel or have been successful 1? • Have some very competent people - knowledgeable, experienced with drive and energy • A visible, organised, principled body that are credible (to regulator) and flexible enough to see things in terms of consumer interests • Good personal relationships with secretariat and leadership • They know the industry • Supportive of other associations

18. Overall when you think of FIA, in what areas would you say they excel or have been successful 2? • They play an important role in bringing member concerns to FSB. • In bringing together what was a fairly fragmented intermediary segment. • Come a long way in engaging on policy and regulatory issues. Position themselves to constructively engage. • Progress in facilitating between regulator and members to explain what regulator is trying to achieve. – the voice of reason. • Formulate position on regulatory policy issues. • Do well with response to specific legislation – e.g binder regulation • Members represent them well wrt STRIDE discussions

19. Overall when you think of FIA, in what areas would you say they excel or have been successful 3? • Retained solid membership base – must be delivering something to members • Merger was a massive significant achievement • A more open (less suspicion) coming from FIA – elevated their horizons. Collaboration vs. confrontation. • Good to bring outsider in (Manie) – he understands process of lobbying. • FIA encouraging advisers to be proactive in embracing changes and taking the opportunities of industry changes. • FIA are getting a mandate and making their voices heard. (not always listened to, but that is not their fault).

20. Where do you think the FIA most need to improve to meet your needs 1? • Improve in input and participation - more specialists, not generalists • More regular formal interactions

21. Where do you think the FIA most need to improve to meet your needs 2? • Expand membership structures to include black brokers and organisations. • They must be seen to add value by publicly applying rules & codes of conduct. • Engage in regulatory issues – do they have a structured approach to consulting and getting input on their positions? • Become more proactive on regulatory issues with solutions /suggestions on where the industry could be improved. (don’t just respond). • Extra point: Clarify FIA position;– proactive industry association versus a professional development organisation • Adopt a broad term industry view not a ‘short term’ myopic view. Become part of the national debate. • Make sure that volunteers do not use their position to gain competitive advantage for themselves and their company. This is currently the case. I.e. represent the FIA position. • Improve access to resources to deal with huge regulatory changes. Need more deputy and more people. E.g. ASISA have 20 staff all with >15 y industry experience incl. lawyers, accounting, actuarial staff. • Extra point: discussion on vision & role for Fin Service intermediary in next 5 to 10 yrs time. • Improve formal communication FIA-ASISA.

22. How does FIA compare to other organisations 2? • Compared to the other organisations FIA are quite good. Similar to Masthead and FPI. • They have done well. (We don’t interact much with other intermediary orgs). • The rest are a joke. Some don’t pitch up at meetings, others have no continuity, mandate or brief. • FIA has much broader mandate. Moonstone and Masthead are quite complementary to FIA.

23. Advisory council feedback • Responses from 43 of 65 (66%) • 40 responses to all 3 questions (62%) – a few not totally legible. • Three questions • Internal things that hinder our ability to achieve our goals • Internal things that help us to achieve our goals • Trends (positive and negative) outside our control

24. Internal Hindering factors

25. Internal Hindering factors (continued)

26. Internal Helping factors

27. External trends and factors

28. Next steps… • Have we given the executive all the information they will need to develop a strategic action plan? Actions:-

29. Additional hindering factors / issues • The value proposition for the independent life brokers. • The difficulty in accommodating tied agents and independent brokers. • Lack of clarity about who we represent and what our role is.

30. Change equation A + B + D > Z A = Vision of a desired better future B = Dissatisfaction with the status quo. D = Knowledge of first steps. Z = Pain of change (financial and psychological).

31. Group A Input to focus areas. • Value proposition. • Image and influence. • Structure and blueprint.

32. Group B Input to Focus Areas • Value proposition. • Structure • Distribution • Leadership • Capacity • Resource • Communication strategy.

33. Identified focus areas from the Group Input in the previous slides • Value proposition • Image and Influence • Structure

34. Focus Area 1: Value Proposition Definition of success / desired outcomes: • All members (from sole proprietors to large brokerages) know what features and benefits (tangible and intangible) are derived from FIA membership. This is split by industry segment. • All members acknowledge and appreciate the value provided to them by FIA. • Achieving targeted membership retention and growth plan. • FIA is acknowledged as the voice of intermediaries in SA.

35. Focus areas 1: Value Proposition

36. Focus areas 1: Value Proposition

37. Focus areas 2: Image and Influence Definition of success: • Members appreciate, value and advocate the benefits of membership. • Consumers realise the value of the intermediary and particularly the FIA intermediary. • The FIA through the Secretariat pro-actively contributes to all matters related to the broader financial services industry, locally and abroad. • FIA membership is a pre-requisite for contracts with all product houses. • Regulators and financial industry bodies seek and value FIA input. • The Press seek definitive comment from the FIA on all relevant issues. • We are attracting new talent into intermediation.

38. Focus area 2: Image and Influence

39. Focus areas 3: Structure Definition of success: • Highly competent individuals in all major disciplines in the secretariat, with limited dependence on volunteers, efficiently executing agreed action plans • We have efficient and effective structures which deliver the value proposition. • Members are encouraged and able to participate in effective local and national structures. • Defined roles and responsibilities exist for members participating in local and national structures.

40. Focus area 3 : Structure

41. How do we ensure that the Strategic Action plans gets implemented? • Review and amend deadlines if appropriate and forward to Manie. Action – Manie Booysen, The President, Justus van Pletzen by 4 Feb 2011. • Present the strategic action plan to the board for their approval. Action – The President by 17 Feb 2011. • Distribute to board members by 5 Feb 2011 requesting written comment by 15 Feb 2011. • Communicate FIA strategy to membership. Action – Manie Booysen by 28 Feb 2011. • Review progress against approved strategic action plans using the Traffic light report. Action – President at Exco and Board meetings. • Update the Traffic light report with strategic actions as they evolve. Action – President – ongoing. • Communicate progress with the action plans on a quarterly basis. Action Manie by 31 May 2011

42. Notes… ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

43. Workshop facilitated by:  Alan Kirschner Customer Diagnostics (Pty) Ltd Tel: +27 (0)11 465-5182 Fax: +27 (0)11 465-2041 Mobile: +27 (0)82 891-4268 Email: alan@customerdiagnostics.com Web site:www.customerdiagnostics.com PO Box 899, Fourways, Sandton, 2055 South Africa