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Top Five Themes on the Asset Management Agenda

Andrew Barnett CFA
Chief Product Officer

2023 has been a tough year and as we near the end, I've identified the following themes that have resonated the most at numerous industry events I've attended or spoken at throughout the year:

1 Harnessing the power of Artificial Intelligence (AI)

It will be of no surprise that this has topped the list of trending topics. We’ve been down this road before with clever machine learning models that seemed to distract in the past. In November 2022 ChatGPT was launched by OpenAI and it was the first real use case that showcased how AI could help us be incredibly efficient in writing great content.  

This has led to many more use cases but for the investment industry, how should we use AI. With vast amounts of data, AI allows those making the investment decisions, a short cut to data that evolves as you use it. The idea isn’t to replace human decision making, but to support it. AI is capable of analysing data quickly to identify and test new products, shortening the time taken to make decisions. However, for AI to work, data streaming must be available first.  

This means that keeping the current target operating model is no longer up for debate and feeds directly into the second top trend for 2023.

2 Removing the friction between the front, middle and back office

At one closed door conference, it was declared that the arbitrary divide of the front to back office is outdated and to be quite frank, a cause of many technology issues that currently exist. Historically, each of these business areas required different technology with funding tiered much higher to the front office and underfunded as you moved through to the back office. As technology has progressed, this is not the case and only serves to cause significant business disruption. These siloed structures cause friction and we need to move to a frictionless environment.

Why you may ask? Data just doesn’t make the distinction of which part of the organisation is accessing it. This means putting up these arbitrary walls stops the information from flowing across the organisation which breaks many of the data processes required for ease of access to inform decision making.

This segways nicely into our third trend for 2023.  

3 Streaming data – one copy – multiple states

As with the revolutionary idea of Snowflake, why move data from one folder or system to another, why not host in one place? A similar concept of streaming data to all business users in an organisation has begun to take shape. The value in doing so is that the data is enriched as it is constantly evolved. This also provides a state where all data is tagged, governed and relied upon. Without this accessibility, new technologies such as AI, our number one theme, cannot be accessible.  

This change in infrastructure then has a more future proof effect, it means that adding on new modules of functionality may not necessarily lead to new technologies required for newer asset classes or types of investment opportunities. Making our number four spot, to support this new thinking, the vendor/buyer relationship must change.

4 Removing the vendor/buyer misalignment – become partners for growth

This is a change of mindset. Instead of treating your solutions providers as an outsourced delivery firm, transition it to a partnership strategy. Your suppliers of technology can act as an internal resource in solving some of the biggest technology issues you may have. They act as an education platform and help your team develop. Having been in house and also as a supplier of technology and best practice principles, it’s important that the relationship moves from “us and them” to “us”. By being outcome focused for the long term, everyone becomes the positive change agent for the future.

One of the key issues highlighted was communication between people within and outside of the organisation. This is the fifth and final trend and is key for the investment industry. Great emphasis on “change” was required across the organisation to collectively own the responsibility to improve a company’s ability to grow.

5 Breaking the culture of resisting change

Change can be hard but it’s often the few who refuse change that make it impossible for the many. Change is now constant. The industry is undergoing enormous pressure to change. There are new regulations in place to protect investors and investors themselves are looking for new opportunities. This places a heavy burden on an already overstretched technology stack that was never meant to be maintained for 20-30 years but replaced as new technology advances were made.

2024 is looking to be equally challenging. As the industry continues to struggle - change must be the catalyst for survival. As I’ve summed up the key themes for 2023, it seems that HUB is standing at the forefront of them. We want to help firms as partners in solving some of the longest standing issues they have faced.

We believe that taking smaller steps and realising value in shorter time frames helps the whole organisation embrace change. By seeing success and value early on, helps bring teams together and builds better business outcomes.

Top Five Themes on the Asset Management Agenda
Andrew Barnett CFA
Chief Product Officer

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