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.
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 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.
- 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