Technology is moving faster than organisations can absorb.
This tension is at the heart of digital transformation, and it shows up clearly in the financial services industry. KiwiSaver providers are responsible for managing billions of dollars in retirement savings, yet many still rely on manual processes and legacy systems. At the same time, artificial intelligence (AI) is creating opportunities to transform customer service, compliance, and member engagement.
We know that AI can deliver these benefits. The challenge is whether you, as KiwiSaver providers, can adapt quickly enough to capture them.
This challenge is best explained by using Martec’s Law.
Understanding Martec’s Law
Martec’s Law, introduced by Scott Brinker in 2013, describes the relationship between technological change and organisational change:
- Technology changes exponentially.
Innovations such as AI, cloud computing, and automation advance at an accelerating pace. Each year brings new possibilities. - Organisations change logarithmically.
Cultural inertia, processes, regulations, and politics slow down the rate of adaptation.
The result is a widening gap between what is possible with technology and what organisations are able to implement.
Why it’s a problem
Technology in financial services is accelerating faster than organisations can absorb. Each year brings new tools that promise better efficiency, accuracy, and customer experience.
As a KiwiSaver provider, you face structural and regulatory limits on how quickly you can adapt. Operating models, processes, and governance evolve at a slower pace, creating a widening “transformation gap.”
When that gap grows too large, risk emerges on both sides:
- Moving too quickly can overwhelm staff, disrupt operations, and increase compliance risks.
- Moving too slowly allows competitors and disruptors to take the lead with better customer experiences and more efficient operations.
Managing the balance between innovation and stability is the core challenge described by Martec’s Law.
Organisations typically respond to this challenge through a combination of incremental improvement, periodic resets, and selective adoption, themes explored later in this article.
Applying Martec’s Law to KiwiSaver and AI
The Technology Curve
AI is already reshaping how retirement savings are managed. The technology and tools exist, and are proven in adjacent financial-services sectors.
- Customer service automation: AI knowledge bases can answer 80-90% of member queries instantly and accurately.
- Advice automation: AI can provide personalised insights, project retirement outcomes, and recommend contribution strategies.
- Compliance support: AI can flag risks, standardise communications, and ensure regulatory consistency.
- Operational efficiency: Processes such as hardship applications can be cut from hours to minutes.
The technology curve is steep and accelerating. The real constraint is the pace at which people, processes, and governance in organisations can adapt to capture these benefits safely.
The Organisational Curve
While technology accelerates exponentially, organisational change follows a slower, logarithmic path. These limits shape how fast organisations can evolve.
Forces shaping the organisational curve:
- Institutional inertia: Established governance, procurement, and risk frameworks slow experimentation and decision-making.
- Regulatory complexity: Heavy compliance obligations make providers cautious about testing new approaches.
- Limited adoption pace: Staff can only absorb limited change before productivity and morale are affected. Training, process redesign, and cultural shifts take time.
- Cultural and structural rigidity: Siloed teams, competing priorities, and risk aversion slow coordinated change.
These forces define the pace at which a provider can safely change, setting the shape of the organisational curve and determining how wide the gap with technology can become.
The Gap
The “gap” described by Martec’s Law represents the practical barriers that organisations must overcome to use technology that already works.
These are gaps in organisational readiness and typically include:
- Fragmented systems and data – information is stored in multiple places, often incompatible or unstructured, making integration difficult.
- Slow governance and decision-making – approvals, risk reviews, and compliance checks delay experimentation and rollout.
- Cultural resistance to change – staff and leaders are comfortable with existing processes and hesitant to trust new technology.
- Limited digital skills – teams may lack the technical understanding needed to test, adopt, or manage AI tools.
- Resource constraints – budgets, time, and competing priorities limit the capacity to implement new systems.
- Siloed structures – departments operate independently, preventing coordinated change across the organisation.
- Legacy infrastructure – outdated systems are hard to connect with modern tools or data pipelines.
Unclear ownership – no single team is accountable for driving digital transformation or maintaining new systems. - Compliance uncertainty – fear of breaching regulatory boundaries discourages innovation.
- Change fatigue – staff overwhelmed by constant transformation initiatives struggle to adapt to new tools effectively.
Implications for KiwiSaver Providers
Martec’s Law has operational and strategic implications for KiwiSaver providers. The gap between technology and organisational change affects competitiveness, efficiency, and member outcomes.
Falling behind faster-moving peers exposes competitive risk as others deliver better digital experiences and lower costs. Outdated, manual processes reduce efficiency and increase operational overheads, while fragmented systems lead to slower response times and less personalised engagement for members.
Together, these factors weaken a provider’s ability to adapt, compete, and deliver the level of service members increasingly expect.
Examples of where the gap manifests for KiwiSaver providers are:
- Knowledge Bases
Technology Curve: AI can unify policies, procedures, and FAQs into a single conversational interface, giving staff instant access to accurate information.
Organisational Curve: Many providers still rely on static Word documents, with staff spending significant time searching for information. - Hardship Applications
Technology Curve: AI can automate document analysis, flag missing information, and reduce processing time from eight hours to under one.
Organisational Curve: Current approaches depend on manual case-by-case reviews. - Advice and Engagement
Technology Curve: AI can detect life events, prompt reviews, and provide personalised modelling for members.
Organisational Curve: Engagement is still anchored in annual adviser-led reviews, which miss opportunities for proactive support.
Managing the Gap
Managing the gap requires both the conditions that allow safe adoption and the strategies that guide deliberate change.
The next sections outline the enablers that create the right foundations, followed by the strategies that help organisations act with focus and control.
Enablers
- Data Readiness: High-quality, structured, and interoperable data is essential for AI to deliver reliable insights. You need consistent data standards and governance to make automation safe and effective.
- Digital Literacy and Capability: Upskilling helps staff and leaders use AI confidently. A workforce that understands AI principles can identify use cases and spot risks early.
- Agile Governance: Traditional approval processes are too slow for rapid iteration. Agile governance models allow controlled experimentation – small pilots with clear guardrails that can scale once proven.
- Partnerships and Ecosystems: Collaborating with technology partners, fintechs, and data specialists helps you adopt innovation without bearing the full development cost or risk.
- Change Management and Culture: Embedding continuous improvement into culture helps sustain momentum and reduce resistance to new tools.
Together, these enablers create the organisational environment needed to manage the pace of technological change deliberately and effectively.
Strategies
The goal here is to manage the gap, staying close enough to capture value without overwhelming your organisation’s capacity to adapt.
- Selective Adoption: Focus on high-impact, low-risk areas where AI can deliver immediate benefits. For example, automating responses to member queries or streamlining hardship applications.
- Parallel Tracks: Maintain existing operations while piloting AI projects in specific areas. This reduces disruption while building confidence internally.
- Culture Shift: Embed Martec’s Law into leadership thinking. Leaders need to acknowledge that technology will always outpace organisational change and plan deliberately around this gap.
- Periodic Resets: Every few years, make larger structural changes such as transitioning from manual monitoring and review to an embedded compliance layer that continuously checks communications and transactions using AI.
In practice, these strategies work best when sequenced: start small, learn fast, build confidence, and then reset for the next wave of change.
Turning Insight into Action
KiwiSaver providers face growing pressure to deliver better customer experiences, improve efficiency, and maintain compliance in a competitive market. AI offers an exponential leap forward in meeting these challenges, but technology alone won’t close the gap.
Martec’s Law reminds us that progress depends on how well your organisation can adapt. Integrating AI by aligning systems, culture and leadership will make changes last. Otherwise, the gap between the two will only grow wider over time.
If you can manage this balance of applying AI to the right problems at the right pace, you’ll stay relevant and lead in the KiwiSaver space.