The 4th Annual Asset Management Digital Readiness Survey: “Necessity is the Mother of Digital Invention”

Kevin O’Shaughnessy, Antonia Bos, Mark Webb

Alpha’s 2021 Asset Management Digital Readiness Survey provides unique insights into the progress the industry is making on its digital journey. Contributions are drawn from 36 firms, working across the globe and managing over $25trn in AUM.

It will be no surprise that the global pandemic has been a major theme this year, as Managers had to urgently shift to digital ways of working as restrictions were applied across countries. This acceleration in plans, coupled with increased focus and spending, has meant many Managers feel they have improved their digital capability and grown their maturity in this space.

Managers now see digital as more holistic term and are looking at Digitization across the whole of the firm, and not just for client-facing use cases. Providing access to dynamic & personalized content and data is seen as a key area for development. These in part are being driven by the reporting needs of ESG & Responsible Investment approaches.

Whilst progress is being made, there is still a concern that firms are not yet fully meeting the needs of their clients and their progress will be hindered if they don’t address organizational design questions. Alongside this, firms want to make best use of the data from the digital footprint that clients are creating.

It is clear that firms are thinking about what the next “new normal” will look like, how they get ready for this, and what lessons they can take from the forced experiment of the last ~15 months.

 

To answer this, we highlight four approaches which can help Managers set up for the future:

  • Continue to invest in defining and designing the client digital experience as this will continue to be a large proportion of how firms will interact. Read more.
  • Seize the opportunity to drive test & learn activity using additional data that is captured from digital interactions. Use this to create specific use cases for your data strategy. Read more.
  • Revisit (or kick off) work on a Strategy for Digital – use this to bring the firms thinking and approach together and set a course for the next 18-24 months. In doing so, factor in the learnings from the last 2 years. Read more.
  • Take the opportunity to look at the organizational structure – especially how digital & technology work together, and the roles between Sales, Digital & Marketing. This would also include assessing skills set gaps in areas such as process redesign, automation skills and data science. Read more.

 

Like many companies, through necessity, Asset Managers have had to rethink and reinvent the way they deliver their services to clients and how they operate internally. This has given a shot in the arm to the digital ambitions and plans of firms and produce some great benefits to companies and their clients.

The key will be to capitalize on the positives that have come from this, as the world prepares to enter a new phase as restrictions and lockdowns begin to ease and we turn to hybrid ways of working.

2021 Digital Readiness Survey by Numbers
  • The definition of digital has expanded. Firms ranked the No. 1 definition for digital as an all-encompassing term that includes the various aspects of their businesses across client, operational and cultural elements.
  • 97% of Managers said that Digital Transformation was now a top priority and nearly half of firms said they expected their spend on digital to increase by more than 5% over the next 12 months.
  • The top 3 drivers for digital change were quoted as increasing client expectations, the need for scale, and enabling remote ways of working.
  • Whilst only 23% say they are meeting their clients’ digital expectations; to rectify this, investment spend is focussed on client improvement, sales enablement and surfacing data through digital channels.
  • Firms predict that digital usage levels across a range of services will grow over the next 18-24 months. This is across client types and moves from the fragmented adoption seen today.
  • Firms’ change programmes are hindered most by their set up and cumbersome governance processes. The age-old issue of tight budgets and legacy technologies continues.
Rising Digital Maturity Levels
  • The increased focus and spend and a year of accelerated developments has seen maturity levels grow across the firms in the survey.
  • We have seen our Fast Follower group increase in proportion from 10% in 2020 to 26% in 2021. Consequently, the Getting Organised group shrunk from 68% to 57%.
  • Most still feel that Fast Follower is a good level to reach, which still allows for selective innovation and R&D activity in certain regions, segments of topic areas.
Source: Alpha FMC’s 2021 Asset Management Digital Readiness Survey

 

The Digital Readiness Survey

If you would like to see more of the findings then please click here to receive the survey results report. Please see our contact details below if you would like to speak to a member of the Alpha Digital & Agile Transformation practice.

About the Authors

Kevin O'Shaughnessy Alpha FMC
Kevin O’Shaughnessy
Executive Director, Head of Digital & Agile Transformation

Kevin is a Director at Alpha and leads our Digital & Agile Transformation practice. He has over 20 years’ experience of driving digital & client centric transformation across the Financial Services Sector and in particular in the Wealth and Asset Management space. His experience covers the full range of digital topics from strategy to execution which have deployed with a range of asset managers supporting a mix of Institutional, Wholesale, Retail and End Investor audiences.

Antonia Bos
Associate Director

Antonia is an Associate Director at Alpha. She has over 15 years’ experience in Financial Services, Distribution & Marketing Services Consulting. Antonia joined from Accenture, where she led the Wealth Management Distribution Practice. She has a proven track record in leading large-scale business transformation programmes from strategy through to execution.

Mark Webb
Manager

Mark has over 7 years in Investment Management, with experience in technology implementations, data systems and client experience design. Most recently he has worked to provide specialist market input through a client experience design programme at a global asset manager, and has successfully led the implementation of a Web Content Management system at a global asset manager which was successfully delivered under presentenced timeline challenges.