Executing global growth
With broad functionality, scalability and flexibility in mind, Ashmore implemented SimCorp Dimension in 2008. Today, Ashmore continues on its growth path, over a 5 year view having zero growth in IT support staff and a reduction of global middle office staff. Over the same period, expanded from a primary office in London in 2010 to 12 offices in 10 countries, seven of these in Emerging Markets. Their agile and flexible IT solution has been a key enabler to help manage global expansion cost effectively.
|Ashmore's IT Challenges||SimCorp's Solutions|
|IT platform lacked sufficient flexibility for future business growth||Replace legacy systems with a modern investment management middle office system|
|Challenging consolidating and extending data||Provide a central dynamic repository of investment data|
|Required a platform to support a truly global operating model||Support streamlined operational processes|
|Reliance on manual processes||Improved functionality, yet simplified system architecture|
|Difficulties in scaling operations||Strategic partnership|
Established in 1992, Ashmore Investment Management (Ashmore) focuses exclusively on Emerging Markets. By 2007, fuelled by its reputation for specialist knowledge and superior returns, Ashmore had grown to be one of the world's leading investment managers in the sector. To continue its growth strategy it was clear that Ashmore’s existing software system lacked the flexibility to cope with the increasing investment diversity and expansion into new markets. Recognizing the risk, Ashmore prioritized its IT infrastructure so that it could effectively support future business activity levels and enable the business to grow with appropriate operational controls.
Functionality, not complexity
Ashmore needed sophisticated functionality, but also believed that utilizing as few systems as possible was key to the operational efficiency required to support growth. Deploying fewer systems with broader functionality would result in a simplified technical landscape with minimal dispersion of data.
In order to maintain tight control, upgrade on a regular basis, and keep their platform modern, Ashmore sought to have their infrastructure as lean as possible. John Gregory, Head of Technology and Middle Office at Ashmore explains, “We don't want our global model to wither on the vine, it has to keep current, so we upgrade the platform every year in order to gain access to new functionality. Our aim is to have as simple a technical architecture as possible. We wanted the efficiency and data integrity that can be assured only by having a single version of the truth.”
We don't want our global model to wither on the vine, it has to keep current, so we upgrade the platform every year in order to gain access to new functionality.
With SimCorp Dimension, Ashmore gained access to that lean platform, rich in functionality. With semi-annual releases available, Ashmore can implement additional functionality when needed. Modules may be “switched on” without new software installation and integration with external systems and utilities is easier too, because interfacing is highly standardized and the database extensible.
Agility to react
Efficiency in day-to-day operations is fundamental to the success of any business, but Ashmore’s growth ambitions also mandate adaptability to handle expansion into new markets and investment opportunities.
The flexibility of SimCorp Dimension, underpinning the operation as it does, has been key to satisfying this requirement. The expansion from one to nine investment offices using the same instance of the system was accomplished in large part because the system is flexible enough to cope with local requirements as well as the needs of the firm as a whole.
Furthermore, the system has been robust and reliable enough, and its documentation good enough, that the deployment required limited specialist consulting support from SimCorp. The outcome has been a global operation with central control and consistency of process and data.
A Global Operating Model giving streamlined operational processes
When firms expand into new markets, they often end up with a number of entities operating on different IT platforms. Ashmore on the other hand, has not allowed divergence unless there is a genuine requirement to do so – for instance local regulatory obligations. To date, their asset management subsidiaries around the world are using the same global platform.
To streamline global operations, integrating a web of different IT platforms is less than ideal. Having a modern and efficient IT platform on a global scale ensures Ashmore is in the best possible position to act on its growth strategy.
John Gregory states that, “While we have expanded considerably in the past five years, our IT staff levels have remained constant, and global operations staff have actually come down in the same period. Part of that was through efficiency gains of pooling IT resources across entities. We've removed duplicate activities for example, instead of processing corporate actions in two different centers, we now do it in one, saving time and money.”
While we have expanded considerably in the past five years, our IT staff levels have remained constant, and global operations staff have actually come down in the same period.
Owning the IBOR - a central repository of investment data
Operating on a global scale, Ashmore needs to know what they own, what they might want to own, how they get there, what the risk is, and to ensure they are compliant. They also need to ensure that when their employees log-on each morning they are looking at up-to-date data that is consistent, timely and trustworthy. If their data was in disparate locations staff would spend significant time every day figuring out their start of day positions.
With an investment book of record (IBOR) at the heart of their operations, Ashmore doesn’t have these questions, and that is critical when operating globally. While SimCorp Dimension comprises many modules, all use the same single database so there is only one “version of the truth” and aggregating data to provide information for operations, management, regulators or clients is straightforward.
Ashmore’s use of the IBOR helps with the internal and external distribution of information from the system for any purpose, including compliance, cash and security forecasting, and full instrument coverage for example.
As John Gregory explains, "There isn't a division in the firm that doesn't utilize the data from our IBOR, either directly or indirectly. If we hadn’t had an IBOR supporting our global growth strategy, I have no doubt that it would have cost more and taken longer to deliver."
There isn't a division in the firm that doesn't utilize the data from our IBOR, either directly or indirectly. If we hadn’t had an IBOR supporting our global growth strategy, I have no doubt that it would have cost more and taken longer to deliver.
Supporting phenomenal growth with the same resources
Between June 2010 and June 2015, Ashmore increased assets by 67% while at the same time having zero growth in IT support staff and reducing global middle office staff by 5%. The company’s assets under management increased by USD 23.6 billion to USD 58.9 billion and the firm now has offices in 12 countries, employing approximately 280 staff.
To support the business so productively, Ashmore’s operation is 'very tight on process'. Performance and exposure reporting is delivered daily from the system for the entire global book of business to the CEO, heads of investment committees and all business lines. The resulting scrutiny means that any issues in the data are found and fixed immediately. Standardization of processes through automation of routine processing have been key to achieving this operational efficiency on a global scale.
With SimCorp Dimension, Ashmore has been able to support the firms’ exceptional growth in volumes, in diversity of investment activities and addition of new markets, with no need to increase technical and operational headcount.
Increasing demands from clients are putting pressure on investment management firms and their data provision. Client reporting ten years ago was usually something that was printed and sent in the post. Client reporting today is usually something that is packaged in a file and FTP’d to a client which they then consume in their own risk models or perhaps their own accounting platforms. Client reporting is also done on a much more frequent basis today, than ever before.
John Gregory notes that, “Clients are more demanding and if you haven't got good, accurate, clean records, how can you effectively service your clients? Our experience has been that clients are not asking whether you can provide the data, they are telling you to provide the data. They've got greater regulation scrutiny in their home jurisdictions and this increases their need to have greater visibility and understanding of where they are at risk.”
With tight control of their data, Ashmore has been able to satisfy this increased demand and frequency of client reporting by using the IBOR. “We've achieved that just by using our data, creating extracts, packaging it and formatting the report per the regulations and then delivering it to whomever we have to deliver it to within the required deadline” explains John Gregory.
With the increased transparency requirements from regulators, Ashmore, like all investment management firms, has had to satisfy increased reporting requirements. While regulatory compliance could have been a huge challenge, Ashmore has delivered. “What we’ve found is that we have been able to meet our new compliance obligations because we have consistent data. We knew where the data was and the quality of that data – from there, it was really a matter of ensuring that that data was configured in a way that our risk, compliance and reporting teams, could deliver on the requirements to the new regulators in a concise and coherent manner. SimCorp Dimension has played a huge role in providing that consistent data.
What we’ve found is that we have been able to meet our new compliance obligations because we have consistent data. We knew where the data was and the quality of that data…
A strategic partnership
SimCorp’s semi-annual release cycle showed Ashmore our commitment to the product, the industry, and most importantly, the client. John Gregory says that, “From the outset, we wanted to work with a vendor where we could have a seat at the table in order to solve problems and develop new functionality. There is a lot of change in our industry, which means that we also rely on our software vendors to ensure new functionality comes our way that keeps us ahead of the curve.”
In 2008, Ashmore set out to establish an operational infrastructure that would support its continued growth and help it achieve its ambition of being the leading Emerging Markets manager. Since then, the business has become more complex in almost every way – in client obligations, in investment activities and themes, in the need for immediacy of information to identify opportunities and understand risk, in regulatory obligations.
While AuM has increased significantly and numbers of accounts and funds has doubled over the past five years, there has been no need to increase operational or technical headcount. Front office and executive personnel have daily and improved analytics of performance and exposures. Inconsistencies and data errors are spotted and fixed much more quickly, the extensive use ensuring the data and the platform self-cleanses daily. For Ashmore’s operational platform, SimCorp Dimension has helped the business simplify.
Name: Ashmore Investment Management
Investment offices: China, Colombia, India, Indonesia, Japan, Saudi Arabia, Singapore, Turkey, UK and USA
Industry: Asset Management
AUM: USD 51.1 billion (at 30 September 2015)
About Ashmore investment management
Ashmore is a specialist Emerging Markets asset manager with assets under management of USD 51.1 billion (as at 30 September 2015) invested across a number of Emerging Markets investment themes including external debt, local currency, corporate debt, blended debt, equity, alternatives (special situations, infrastructure and real estate), overlay / liquidity and multi-asset products.
The business was founded in 1992 as part of the Australia and New Zealand Banking Group. It became independent in 1999 and listed on the London Stock Exchange in 2006. Ashmore Group plc (ASHM:LN) is a member of the FTSE 250 index. The company has significant employee ownership. Ashmore is headquartered in London, England and has offices in China, Colombia, India, Indonesia, Japan, Singapore, Turkey, and the United States.
Learn how Ashmore has expanded from a primary office in London in 2010 to 12 offices in 10 countries, seven of these in Emerging Markets. Their agile and flexible IT solution has been a key enabler to help manage global expansion cost effectively.