Alpha FMC - Service Providers

Service Providers

The Asset Servicing industry plays a critical role in safeguarding assets and supporting the middle and back office operations that underpin the Asset Management industry. Servicer Providers are currently facing a period of unprecedented change and opportunity, and the importance of data is becoming greater than ever; leading providers will need to innovate to succeed. Asset Managers are under pressure from their clients to demonstrate the value they add, and Asset Servicers are no different. It is imperative to move from ‘selling a service’, to ‘selling a valuable service’, whilst still remaining transparent. Alpha has significant expertise in this area, and we are able to offer our Asset Servicer clients clear, informed and cutting-edge solutions.

How we work with clients

At Alpha we work closely with our Asset Servicer clients to understand their challenges in depth, and more importantly, the levers that drive success. We help Asset Servicers to tackle a wide range of issues and we offer a wide range of process improvement ideas and initiatives.

Our key areas of support can largely be categorised across 3 areas:

Strategic Growth:

  • Strategy Definition & Implementation
  • Market & Product Entry
  • Service Benchmarking

Operational Efficiency

  • Operating Model Design & Implementation
  • Automation & Innovation Proof of Concept
  • Enterprise Transformation

Client Support

  • Programme Delivery & Assurance
  • Transformation & Change Framework
  • Client User Experience Analysis
Alpha FMC - Why Alpha

Why Alpha?

We have unrivalled specialist knowledge of Asset Servicing from Operations to Technology, to Product to Change. Critically, we work across our clients’ entire businesses and value chains. As a result, we are in a unique position to see why Asset Servicers need to move themselves up this chain to survive, and advise on how they can achieve this.

Our clients are offered cutting edge insights on leading technology and automation solutions to increase efficiencies and enhance their service offerings within this space.

Q&A with Caoimhe Munif, Senior Manager

What are the key trends in the Service Provider industry today?

1. Data is driving everything; Service providers can leverage data analytics to learn how to respond to changing markets. In times of financial instability, access to data and leading technologies is becoming even more important to ensure fast and accurate communications
2. Human activity will be enhanced by machines; robotic processing automation (RPA), for example, can automate high-volume repeat tasks such as trade processing, reconciliation and reporting. This allows for humans to refocus on high-value, highly interpersonal tasks
3. Servicers will be ‘always on’ and ‘real time’; clients are increasingly demanding real time views on certain practices such as cash and settlement
4. People born after 1995 will become buyers; Millennials and Gen Z are increasingly responsible for selecting / overseeing outsourced service providers

What impact is Alpha seeing as a result of these industry trends?

The ability for Asset Managers to make informed investment decisions in today's complex markets requires significant resource and focus, and more importantly – immediate access to reliable internal and external data. Increased regulation is also forcing transparency and encouraging Asset Managers to look at new technology solutions, such as Aladdin and Charles River Development, to help create a transparent environment that simultaneously increase client service. Over the next 5 years, data will continue to drive everything, and Asset Servicers need to be prepared for this.

There is also increased pressure to implement other leading technologies and ‘real time’ solutions such as APIs and robotics. This will enable Asset Servicers to automate non-differentiating services and get a ‘step ahead’ of the competition. Batch processing and static portals will likely soon be redundant.

As a result of a new generation overseeing oursourced service providers, we are also seeing a move towards prioritising ESG, including ‘paperless’ approaches to sales, and consideration of ESG factors in behaviours.

How is innovation currently affecting the Asset Servicer industry?

Simply put, innovation is reducing fees and increasing competition.

There is a current focus on increased automation and integration which should reduce costs, leading to a reduction in fees. Improved technology & agile methodology will also make transitions simpler and more efficient, reducing the cost and risk to move.

Whilst it is unlikely we will see new entrants in the market, we will likely see incumbents being more aggressive in price. We are also seeing increased bundling of services being offered and ‘one stop shop deals’ in the TA space, with all services placing a strong focus on ‘adding value’.

The Covid-19 pandemic is bringing the world into uncharted territory – what impact can we expect this to have on Asset Servicing?

Since the last financial crisis, data has become a more valued piece of the Service Provider offering; the global pandemic and resulting uncertain financial times ahead have only emphasised this. Especially in times of high market volatility, Asset Servicers need immediate access to data to ensure fast and accurate communications with clients. Client reporting demands are also likely to increase and Asset Servicers will need to act fast, of face being suppressed by the competition.

Alpha FMC - Service Providers