IT investment strategies and business outcomes

It Investment

BT is the wealth management arm of Westpac. The company has a number of business units and product lines, each with its own customer base. As a result, the company has a vast amount of customer information. In order to grow the business, this information must be unlocked, so that it is able to travel freely to the advisers within the company. If this occurs, BT sales people will be better equipped not only with new sales leads but also to improve their level of customer service.

Current Competitive Situation

BT is an investment firm and insurance company that markets to both the consumer market and the corporate market. The company also offers retirement and tax planning services. The products are typically tailored to the needs of individual clients, and this service component is a significant part of the business. Revenues are earned on the basis of fees for service and commissions on products sold.

The goals of the company are to increase market share and revenues, primarily by increasing the customer base. The group started in 1969 and today has over $95 billion in total investments. The company serves Australia and New Zealand. The company works with over 10,000 advisers around Australia. The company administers plans to over 23,000 employers and 550,000 plan members and its life insurance business has over 1 million enrollees (BT.com.au, 2011).

There are a number of competitors in the different industries in which BT competes. BT is the investment arm of Westpac, and the other major Australian banks all have their own wealth management divisions as well. Competition is intense in the industry and most of the major players are well-capitalized and compete in multiple segments. In this respect, BT competes on the basis of its experiences, its relationship to Westpac and on its network of advisers, but none of these can be considered competitive advantages as most major competitors share similar traits. The primary marketing issue for BT is to differentiate itself from those competitors in order to continue to attract business.

Strategic Business Challenges and Opportunities

The main challenge is to deliver superior growth for the company. There are a number of sub-challenges where it can help facilitate superior growth. One of these is generating internal sales. BT has a number of units, in addition to access to Westpac's customer base. As such, it can generate sales leads internally, but only if its advisors are aware of potential clients. Fostering strong relationships across business units can significantly improve revenue and reduce customer interaction with competitors. It can play an important role is solving this problem by networking the information systems of the different business units and creating channels of communication flow between the units. If it can link these different units in terms of common compensation mechanisms for advisors, this will allow the company to better incentivize cross-unit referrals.

Another challenge facing BT is to increase adviser knowledge. Today's investment environment is complex and challenging, but clients still want superior performance at reduced risk. It systems have been developed that help advisors to manage complex portfolios by illustrating the changes to the portfolios that will come about given specific changes to the economic or tax environment. Such software can deliver clear competitive advantage to BT advisers by giving them the ability to make better recommendations -- and faster -- than competing firms (Business Wire, 2007).

In both of these situations, better information technology and information systems will give the advisers the tools they need to attract new business and to outperform competing wealth management services. These tools will then drive business to the individual advisers, resulting in the super growth that was the original challenge the company wanted to address.

Assessment of Alignment

At present, the it function provides a substantial amount of information to BT, but there are still opportunities to improve linkages between business units. The it department is strong, but not as proactive as it could be in finding new ways to help deliver competitive advantages to the advisers. Marketing is the key way in which it can help BT to grow -- there are hundreds of thousands of customers scattered throughout Westpac's different companies and the more access BT's advisers have to these clients and their information the better they will be able to generate new business. In addition, most advisers rely on information provided through internal channels to help with investment decisions. Therefore, it can play a key role in improving the quality and timing of that information. At that point, it will be considered that there is an optimal alignment between the it function and strategy. The present level of alignment is good, but the company can outperform its competitors if the alignment between the it function and strategy is improved, by making it more of a sales support function and using it to free the flow of information within the company.

Strategic Opportunities