With apologies....

With apologies to my actuarial and marketing friends......

Two people are flying in a hot air balloon and realise they are lost. They see a man on the ground, so they navigate the balloon to where they can speak to him. They yell to him, "Can you help us – we’re lost."

The man on the ground replies, "You’re in a hot air balloon, about two hundred feet off the ground." One of the people in the balloon replies to the man on the ground, "You must be an actuary. You gave us information that is accurate, but completely useless."

The actuary on the ground yells to the people in the balloon, "you must be in marketing."

They yell back, "yes, how did you know?"

The actuary says, "well, you’re in the same situation you were in before you talked to me, but now it’s my fault."

Mergers - Who Really Benefits?

One of the things that intrigued me about the 20 year anniversary edition of Professional Pensions was the article by JonathanStapleton looking back at the names of the companies that were advertising in that very first issue.

Names that have now disappeared: Hill Samuel. GAN. Dibb Lupton Alsop. Kaupthing Singer & Friedlander. Capel-Cure Myers. Gartmore. Abbey Life. Hogg Robinson. Morgan Grenfell. Hewitt. Norwich Union.

All gone- and mainly forgotten in a plethora of mergers and takeovers over the years.

And now another one. Aberdeen and Standard Life are to merge.

I suspect the name Standard Life will survive. But then I thought that of Norwich Union before it gave way to the clinically globalised name Aviva.

Pensions Age Magazine quotes the marketing gobbledygook: ‘[the] merger would harness Standard Life and Aberdeen’s complementary, market leading investment and savings capabilities which would deliver a compelling and comprehensive product offering for clients covering developed and emerging market equities and fixed income, multi-asset, real estate and alternatives.’

They mention synergies. And surely there will be. In the way of job losses for the back-room functions mainly. But what about the investment managers- the individuals tasked with making the strategic decisions? Changes are not always welcomed to the people that do the work. They are used to a system, used to a style. When that style changes, so might their appreciation of the job they do. This in turn can affect returns for clients.

Synergies? Cost savings more like. And cost savings don’t always mean benefits for clients.