AIA: The customer business

The battle for distribution that has been going on in New Zealand since the mid-1980s was once the domain of the old guard - names such as National Mutual, Australian Mutual Provident Society, Colonial Mutual, and the now quaint-sounding Government Life Office. With tools like agency development loans spawning terms such as ‘golden handcuffs' - essentially, large cheques written with few or no conditions other than return of capital and production - they focused on protecting their greatest sales assets.

The game was simple. They who produced the most were the winners. On the face of it, this was exclusively about the top line, with no obvious investment in or view to the long term. Distribution domination was everything. Not surprisingly, it was all rather unsustainable, and collapsed.

The problem with the model was that it was based on high sales achievers, and you can't rest an entire industry on that: it's impossible to keep everyone happy all the time, and attempting to control salespeople comes at a cost that no business can pay indefinitely, especially when a more youthful competitor emerges.

The growth of this model's replacement, the independent financial adviser market, has led to the rise of organisations that consider themselves to be distribution companies or groups.