The group strategy was refined and adopted during 2015. Through the course of the current financial year, product lines were re-allocated between clusters and cost allocations were refined in order to align with our strategy. As a result, historical comparisons of operating profit which reach further back than the prior financial year are difficult to provide. However, the five-year operating income CAGR from the institutional cluster was 7%.

Create a joint institutional cluster (AFFS Institutional and Investment Solutions) to optimally manage the value chain

The transition to institutional and retail structures was managed through an internal change management process and completed during the year under review. The core leadership of IS and AFFS have assumed responsibility for co-ordinating the servicing of common clients.

Reposition the public sector division to report at an institutional cluster level

The public sector team is now strategically accountable to the institutional cluster and co-ordinates interaction with the public sector across IS and AFFS.

Campaign to improve client engagement

The employee benefit consulting and administration and the healthcare divisions were successful in the year under review by, among other things, senior management engagement with clients and through dedicated client servicing teams. The positive consequential results were a reduction in lost business and improved client satisfaction levels. Clients evaluated as being ‘at risk’ for various reasons are also tracked and discussed at monthly institutional cluster meetings and key actions determined.

IS continues with its Adopt-A-Client initiative in which executive committee members are assigned responsibility for building relationship with strategic clients. The business conducts an annual client engagement survey to test the depth of client satisfaction.

Develop a sales operating model and dashboard to have more focus and visibility on new business

A sales management, recording and reporting process has been designed using Microsoft CRM. This allows management to track key metrics such as pipeline strength, sales team activity and conversion ratios. The AFFS Institutional and IS Institutional sales heads meet monthly so that an institutional cluster approach can be taken to new business and sales activity.

Focused growth of world-class umbrella funds

In 2016, we introduced a new end-to-end pricing model for our umbrella fund. In 2017, we will continue to enhance the product, focusing on an improved cost effective solution for SMMEs. In addition, we will launch in-fund umbrella preservation and annuitisation solutions for our members in August 2016 and a group retirement annuity solution later in the year.

Defend our market leadership while exploring new sources of growth

Market leadership in the retirement fund industry is a factor of membership under administration and assets under administration – both of which we grew from 2015. Assets under management in all our umbrella funds grew by 9% to R72.6 billion, while assets under administration in our standalone retirement funds grew by 10% to R346.5 billion. Members under administration totalled 1 029 087 at the end of the financial year.

Complementary growth areas commenced in 2016 and 2017 have been beneficiary fund administration (in addition to the consulting services we provide), Africa employee benefit solutions including a pan-African health solution and multinational risk pooling. Initiatives to penetrate non-retirement funds have been slower than anticipated.

We are exploring providing insurance consulting services to insurers in the Middle East and Turkey, expanding from our African client base and our more traditional opportunities.

The group strategy was refined and adopted during 2015. Through the course of the current financial year, product lines were re-allocated between clusters and cost allocations were refined in order to align with our strategy. As a result, historical comparisons of operating profit which reach further back than the prior financial year are difficult to provide. The five year operating income CAGR from the retail cluster was 12% and from AfriNet was 20%.

Formalise the retail cluster structure

The transition to institutional and retail structures was managed through an internal change management process and completed in 2016.

Move towards a single distribution model – establishing a joint sales force

On 1 April 2016 the new operating model was implemented with an integrated distribution model delivering short-term, long-term and investment solutions. In enabling success and delivery, retail IT, a common client experience, brand messaging and marketing have been given priority.

Institute a worksite campaign to encourage early engagement and financial planning with members in our fund – to ensure their financial well-being

Financial well-being days piloted at Alexander Forbes and an institutional client during the year under review. These generated significant learnings which have been incorporated into a new and improved financial well-being concept to be launched in the new financial year.

Expand our AfriNet footprint through acquisitions

While we have had good organic growth within AfriNet in 2016, no acquisitions were concluded. We use a robust scoring methodology to assess the attractiveness of various African markets when making the strategic decision to enter or exit a market. An acquisition in West Africa is being explored and expected to be concluded in 2017.

6% year-on-year improvement in productivity in terms of revenue per employee.

Establish accountability within the group to drive operations, systems and technology through the operational cluster

The operations and technology cluster has been established, and holds accountability for the full operational and technology platform within the group.

Establish the group shared services cluster to optimise shared services

The shared services cluster was established in 2016 to drive efficiency and operational effectiveness throughout the group.

Drive strategic and enterprise programmes through an enterprise project management office

Executive head of the EPMO appointed and broad range of group-wide projects identified and prioritised for implementation. Further building of EPMO capacity to occur as projects initiate.

Invest in senior leadership

The group continues to invest in developing the leadership skills of its management team. For more on these programmes, see 'Ensuring continual development'.

Continue employee engagement and performance to drive productivity

While productivity increased 6% during the year, the engagement index declined 5% to 60.9%, with 57% of employees positively engaged, excluding employees in the UK.

The innovation hub received 437 new ideas in 2016. Nine of these have been developed into ‘betterment innovations,‘ and their business cases will be pitched in our annual innovation den.

Our enabling innovation team launched a website called BetterWage.com, which connects freelance workers and freelance work opportunities globally.

We were also shortlisted for two innovation awards this past financial year. Our Lifegauge model was a finalist at the SA Innovation Awards and our Stokvel product was in the top ten financial services innovations of 2015.

Step up our company-wide innovation campaign

Our innovation programme was launched in 2014. Employees are encouraged to submit original ideas with the potential to increase revenue, decrease costs or streamline a process.

Include betterment innovation targets in the divisional businesses’ key performance indicators and allocate resources to achieve this

We targeted ten betterment innovations over the medium term (three years) and have already brought six to market.

Set up a disruptive innovation capacity within the group

The disruptive innovation team was established in 2015 and aims to design and implement solutions that radically change the way the Financial Services Industry approaches challenges.