Alpha FMC - Wealth Managers

Client Reporting: The Next Generation

Neil Curham, Thomas Goldwater

As the Investment Management industry continues to navigate a period of significant uncertainty, never has there been a more appropriate time for managers to provide reassurance to their clients through timely and accurate reporting. However, on account of the shift in working patterns brought about by COVID-19, the need to drive down operating costs and reduce risk only adds to the case for change. Unsurprisingly, over 80% of respondents in this year’s Asset Management Digital Readiness Survey identified client reporting as the primary target for automation and transformation benefits.

The evolution of client reporting

Generation 1.0: In its simplest form, client reporting solutions were focused on the basic provision of pages, relying on a very limited ‘in-house’ production process.

Generation 2.0: As the capability matured, we witnessed the introduction of externally managed platforms. However, the integration between the business and the respective vendors remained siloed, greatly limiting the quality and customisability of the final reporting output.

Generation 3.0: Now, as the industry continues to evolve, firms are moving to a more client-centric solution, with key business functions integrating within the broader technology estate. This results in a more consistent, compliant technology architecture supported by a holistic integration of data, enabling firms to more efficiently create high quality reports for their clients.

Why now?

The question firms must ask themselves is how long do they wish to fund a costly, outdated approach to client reporting? Typically, firms respond to inefficiencies within their technology stack by adopting labour intensive, manual workarounds which creates a self-perpetuating cycle of increased overheads underpinned by growing operational risk. Consequently, they become slower to respond to ever changing regulatory and client reporting requirements.

If this doesn’t motivate action, the growing expectation of clients eventually will, as the prominence of personalised, digital solutions in the Investment Management industry continues to grow. From the firm’s perspective, the cost of inaction is a battle on two fronts; the burden of managing a growing cost base, compounded by the threat of impacting client satisfaction (leading to a squeeze on margin).

Where to start?

Firms need to act decisively to achieve meaningful change. Alpha recommend the following approach to help focus priorities:

  1. Plan with the end in mind. Set the foundations for a successful transformation by clearly defining your firm’s reporting requirements and investigate how to access the underlying data. This is the only way to truly understand what is required to support your end goal.
  2. Fix the data. Governing the creation, maintenance and use of data is an essential dependency for an effective reporting capability. Centralising access to key data increases usability and reduces operational risk.
  3. Transform to succeed. Re-align your operating model and implement a best in class technology solution to create an automated, efficient and flexible capability.

What are the benefits?

From our experience, clients who have invested in an industry leading reporting solution have enjoyed a range of internal savings, and have been able to project these as benefits to their clients:

If this is a topic you wish to discuss further, please reach out to Neil Curham to arrange a convenient time to speak.

About the Authors

Neil Curham Alpha FMC
Neil Curham
Global Chief Marketing Officer

Neil has fifteen years' experience working within investment management distribution and has more than eight years consultancy experience. During this time, Neil has assisted with business, operational and technical strategy addressing areas such as service proposition, client relationship management, client communications, marketing automation and web delivery.

Thomas Goldwater

Tom is a Manager in the Digital Practice at Alpha with over six years' experience working in consulting with financial services clients. He has helped design and implement programmes of work using digital technologies to solve client problems, with a growing focus on transforming client reporting, and the distribution space in general.