Director of Solutions
As Director of Solutions for Clearwater Prism, Dillon is responsible for assisting companies in defining and implementing Target Operating Models for investment reporting processes. Since joining Clearwater Analytics in 2013, Dillon has served in roles across client services, sales, and product, giving him a deep understanding of client needs. Based in Boise, Idaho, Dillon earned a BBA in finance from Boise State University.
I recently spoke with a director at an asset management firm and showed him Clearwater’s flash poll results that indicated 73.7% of asset owners (his customers) would like to receive customized portfolio reporting.
Looking at the poll, he shook his head and said, “We just don’t have the people required to give customized reporting to many of our clients.”
This is the old way of thinking.
When asset managers say, “We don’t have the people,” what they should be saying is, “We don’t have the people OR the technology.”
Asset managers, I’m here to tell you: It’s not a people problem. It’s a people + technology problem.
For many years, spreadsheets were a cornerstone of data management for asset managers. I’ve found spreadsheets to be a powerful tool, but one that is deceptively dangerous. When used for business processes, it can lull teams into a false sense of security. You can build almost anything in it, and then trust it unquestioningly for many years.
I once worked with a client to implement an investment accounting technology solution. As we worked through their old spreadsheet processes, we found there was a critical number that they had been reporting incorrectly for years. Further investigation revealed the problem: Someone had incorrectly updated a formula in the spreadsheet, and no one had ever noticed the mistake.
This is the old way of using technology.
When asset managers say, “We didn’t realize our data was inaccurate,” what they should be saying is, “We are upgrading our system so we know our data is accurate.”
With new technology implemented into daily processes, asset managers can reduce the complexity and risk of data management.
As the technology around asset management changes, so does the workforce. This is especially true of young people who are early in their career, many of whom are already accustomed to working with modern technology.
Young workers starting their careers are unimpressed by legacy spreadsheets and the tedious manual tasks associated with them. It’s unfortunate for many asset management firms, but the status quo is unlikely to meet the needs and expectations of Gen Z.
We’re seeing many young workers expect features like self-service functionality. They want to be able to interact with data and modify the output to meet any job-specific needs. In this regard, legacy spreadsheets might not be the most appealing option for the next generation of asset management professionals.
Perhaps partially due to the technology gap, the financial services industry has seen a material increase in turnover in recent years, posing a significant business risk. For asset managers seeking to attract and retain top talent, it’s no longer enough to train new employees in outdated processes.
Rather than saying, “Young workers aren’t interested in learning our processes,” asset managers should be saying, “Young workers want to work with state-of-the-art technology. Is this something we can offer?”
There has been a lot of volatility in the world over the past few years, between the pandemic, the great resignation, the war in Europe, and ongoing market instability. One bright spot through these challenges has been the growth and adoption of high-tech solutions.
We’re seeing new technology permeating every aspect of the asset management workflow. Managers are using new tech to streamline portfolio management and drive returns, as well as to improve operations performance and compliance.
On the client reporting side of the business, though, we are still seeing a large gap between services offered and client expectations. It’s increasingly common to hear that clients don’t want to spend time working with spreadsheets, slide decks, or PDF reports, a trend that aligns with how the young workforce views these outdated formats. Yet it is still common in the industry for asset managers to send their clients reports in a format that doesn’t align with their needs.
By implementing state-of-the-art technologies for client reporting, data management, and business intelligence, asset managers can empower their workforce, as well as their clients. A technology-enabled workforce combines the strengths of both people and technology to meet the complex needs of today’s market.
It’s a people + technology problem, but luckily, there is a people + technology solution.
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