At our recent conference, I had the privilege of presenting on the impact of long-term technology trends on the LGPS. During the session, I hoped to demonstrate that whilst engaging with technology – for non-technologists - might seem daunting, it doesn’t need to be as scary as it first seems… even when you have limited time and technical knowledge.

One of the major hurdles in adopting any new technology is the specialist jargon that often accompanies it. This can make new concepts seem inaccessible. To bridge this gap, you can back away from the academic papers and try using resources designed for a more general audience. Programs like BBC Click and TED Talks provide insightful overviews of current trends without the overwhelming technical detail. Building a basic understanding through these sources can help you demystify technology yourself and give insight into its practical applications.

This consideration of application is crucial as any new technology is not inherently valuable. Its real worth emerges when you apply it to solve real-world problems.

For example, artificial intelligence (AI) has the potential to revolutionise all kinds of human-intensive activities, but only if implemented thoughtfully. You can start by identifying the challenges and opportunities within your own fund. Are there any processes that take a lot of research time? Is there a need for more sophisticated data analysis? Do you have lots of documentation that takes effort to navigate? These types of consideration can help pinpoint where technology could be most beneficial.

There is a useful role for controlled experimentation in understanding what some of these applications might be. Rather than committing significant resources upfront, you can start with small-scale trials and test out technology now – investigating how it might work best and understanding its real limitations or opportunities.

For instance, if you’re interested in AI, you could begin by simply playing with a platform like OpenAI's ChatGPT. Taking a hands-on approach allows you to really understand the technology's potential and applicability to your specific needs without taking significant risk or requiring a large investment in time and money.

I demonstrated this approach at our LGPS conference by showing the audience how they could build a chatbot of their own using a large language model (LLM) that was given access to specialist LGPS resources available on the public web – and showing that this was both possible and very effective without requiring any understanding of how LLM’s are calibrated or how neural networks actually work behind the scenes.

The discussion that followed raised some interesting points on the importance of safeguarding when using AI. Trustworthy data sources and thorough validation of these are essential. Limiting AI’s data access to trusted repositories rather than the entire internet, especially when specific, accurate answers are required is important in maintaining a level of confidence in any generated responses.

It was also highlighted that despite the capabilities of advanced technologies, human judgment remains indispensable. Technology should augment human decision-making, not replace it. Many are concerned that AI might remove the need for certain roles. Whilst this may be true of some very specific job roles, it’s far more likely to change some roles rather than eliminate them. It may also create new ones as human oversight and critical evaluation help ensure that any implementations are continually aligned with both organisational goals and ethical standards.

Ultimately, technology doesn’t have to be scary, and embracing it can lead to some great innovations for both funds and scheme members. By starting with manageable steps anyone can begin to understand technology's potential. Remember, the goal here is not to become a technology expert or digitally transform your fund overnight but to progressively integrate technological solutions that enhance your fund’s operations and targeted outcomes.

If you'd like to discuss any of this in more detail, or have any questions, please get in touch.

This blog is based upon our understanding of events as at the date of publication. It is a general summary of topical matters and should not be regarded as financial advice. It should not be considered a substitute for professional advice on specific circumstances and objectives. Where this blog refers to legal matters please note that Hymans Robertson LLP is not qualified to provide legal opinion and therefore you may wish to obtain independent legal advice to consider any relevant law and/or regulation. Please read our Terms of Use - Hymans Robertson.