We are fast approaching a perfect storm in asset management.   From our standpoint here at Fundipedia, a data agnostic data management platform used by a range of high-profile firms such as M&G and Barclays, we have a unique perspective on the market and the challenges it faces in the next three to five years.

In summary, we expect firms that are ship shape i.e. they already invest in resources, technology and drive their business forward with a clear operational focus and strategic objectives around data governance, will come out ahead.

Admittedly this was always the case – but the same COVID-19 outcomes which have accelerated the demise of high street shops will suitably punish firms that continue to ignore the importance of their data.

The FCA are on to disorganised data in firms too.  Based on their 2017 review of the industry, they recognise firms continue to underinvest in adequate technology for data stewardship.  In fact, they specifically call it out on page 22 of their 2020/2021 business plan:

The UK investment management sector covers asset management, institutional intermediary and advice services, and custody and administration services.

Harm in the sector is caused by several factors, including cases of poor governance, insufficient focus on delivering good value, and lack of investment in technology and operational resilience.

So enough doom mongering, let’s pull up the anchor and explore how firms who wish explore a sea of data driven decisions can get set sail.

1 Create a CDO position and fill it – fast!

If your firm does not already have somebody in charge of data, you are in danger of being dead in the water.

Hiring, or better still promoting, somebody into a chief data position is crucial because it ensures that somebody in the organisation is now responsible for data.

This person must report into the C-suite – ideally COO or similar. They need to have budget, autonomy, resources, and a thirst for making business wide change.

They also need to be highly persuasive. We often see specific departments struggle to relinquish control of their data or push back on any advance to remove their ownership of data. The CDO will need to leverage their diplomacy skills to achieve results quickly.

2 Speak with your network and learn from others in the industry

When used and governed correctly, innovation holds great potential to drive efficiencies, streamline processes, build resilience, and free up employees’ time for more value-add  activities. However, there are also risks and challenges associated with the adoption of certain technologies that need to be understood and addressed.

Reduce this risk by speaking with others in the industry who are one or two steps ahead of you. This can include industry bodies such as the Investment Association, who run a fantastic Engine fintech accelerator that Fundipedia is part of.

Speak with data experts with specific asset management experience.

Speak with solutions providers such as Fundipedia. Discuss the current and future trends they see across the asset management data landscape.

Partake in tech forums aimed at supporting senior technology experts, such as CTOs and CDOs, to address their technology priorities.

3 Create and socialise a business case for a data governance strategy

Armed with lessons learned from your peers and starting with the data that is critical to regulatory reporting and operational efficiency, you can now undertake the journey to write a business case to take the data governance initiative forward.

Amongst other benefits, the business case ensures that the key stakeholders and decision makers understand the ROI of any data governance initiative and sets the journey off on the correct foot and with a tangible set of outcomes documented.

Outcomes we would expect to see documented in the business case include:

  • Ensuring data terms are clearly defined company-wide
  • Improving confidence in how business users handle data
  • Clarifying roles and responsibilities for data owners, data stewards and data users
  • Enhancing data quality and mechanisms to distribute it efficiently and accurately
  • Understanding data lineage through full data audit trails
  • Improving decision-making capabilities through access to data
  • Simplifying the process of proving compliance to third parties

Clearly the best argument for any business case uses monetary terms!  So, after you’ve set down the costs, you should highlight how this investment will be paid back over time. While the proposed initiative might carry a range of ongoing operational benefits, a demonstrative financial benefit will be critical to securing the buy-in of your investors or leadership team.

On the savings it is important to note:

  • All immediate money savings the initiative offers
  • Annual cost savings when weighed against maintenance costs
  • An estimate of the total financial value of the initiative

4 Invest in technology that integrates your data and evolves with your business

The vast majority of the firms we work with that are in desperate need of a data initiative have no business wide understanding of the data they hold, who owns it, the data lineage (where it is sourced from and delivered to) and much more…

Deciding which technology is appropriate for the problem at hand is a process worth spending time on.

Work backwards from the problems highlighted in the business case to understand how specific technologies can assist. For each potential technological solution (AI/ML, big data, dashboards, workflow etc) select two or three potential vendors.

While the specifics will vary from organisation to organisation, I would surmise that in most cases the solution you propose should:

  • Offer self-service capabilities for end-users
  • Be capable of being fully integrated with other up and downstream solutions
  • Be straightforward to use, with minimal training required
  • Allow users to ingest, prepare, analyse and act on operational data
  • Be a part of a larger ecosystem of clients, all of whom are heavily invested in the solution evolving to meet ever changing needs

So there you have it – four steps to get your data ship shape and your organisation ready to outflank your competition.

If you are interested in meeting likeminded data problem solvers come join our LinkedIn group: https://www.linkedin.com/groups/8912191/.

Finally, if you would like to learn more about building a business case and what should be incorporated in your attempts to secure that all-important buy-in, our team at Fundipedia have years of experience and we’re eager to help.