Operating Model Benchmarking

Benchmarking an in-house operations’ cost and capability against our global comparison data, to pinpoint key service recommendations for the future.

Client Challenges

This large US-based asset manager ran all operations in-house and did not know how their cost and service performance compared to the market.

The COO had been under pressure to consider outsourcing options, something he was hesitant to do as he believed that the operations were efficient. There had recently been significant internal investments in their operations capabilities.

Alpha Approach

Alpha benchmarked costs, service levels and capabilities against our global data-set of metrics.

The review found that, overall, the operations were both cost efficient and delivered very good service levels, however, two focus areas were identified:

  • The costs to provide derivatives administration were very high. This was because volumes were too low for the expensive infrastructure. We recommended to consider outsourcing this function if volumes remain as-is
  • The manager’s project spend was three times higher than for comparable managers, partly due to a large, standing, project team. We recommended to find a more dynamic and flexible approach to managing change that avoids the team “creating work” to keep themselves busy

Client Benefits

Alpha’s breadth and depth of operations data gave the client deep insights with clear actions. By providing independent metrics-driven analysis, the client was able to more easily gain buy-in to implement recommendations.

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Client Types

  • Asset manager

Sponsor

  • COO

Functions

  • Investment operations
  • Derivatives administration
  • Fund accounting
  • Client reporting

Geographic Scope

  • US

Fund Types

  • Mutual funds
  • Segregated mandates