The disconnect between today’s operating model and tomorrow’s workplace

Is there a glitch in your “matrix”?

Read the article and learn about:

  • The future battle for talent in the investment management industry
  • How to prepare your transformation into a data-driven organization
  • The requirements of a future workforce
investment management workplace of the future
Tomas Edwards
Global Product Strategist, SimCorp

About the author

Tomas has 18 years’ experience in global roles and locations, including UBS Wealth Management and a short stint leading the Wealth Management business of a rival software provider before joining SimCorp in 2016. He utilizes his knowledge to lead the strategy for, amongst others, data management products.

For several years, we’ve been talking with our clients about the value of data. The ability we now have to collect, store and analyze data is driving new approaches to research, analysis and client engagement. Data can help you understand yourself and your clients better than ever before and create exciting new opportunities. However, in order to take advantage of data, your organization must be prepared for it. This article investigates some of the prerequisites for becoming a data-driven organization.

Because of our position in the industry – working closely with the world’s largest asset managers – we can attest to the dominance of data in organizational strategies. However, we’ve also discovered that there is sometimes a disconnect between those strategies and the organizations that need to realize them.

Just as investment management firms want to take advantage of the latest digital innovations, their future employees want to work for technologically innovative companies. It’s well documented that the digitally native Generation Y (Millennials) and Generation Z (those born after 1996) bring new expectations regarding technology into the workplace. In a Microsoft survey of more than 1,000 millennials in the U.S., 93% said that having up-to-date technology is important when choosing a company.1

Millennials are also not hesitant to leave a company that doesn’t fulfill their needs for a challenging, rewarding work experience. A 2018 Bridge survey reported that if a job lacks growth opportunities and avenues for leadership development, 67% of millennials would leave that position.2

The disconnect

As some investment management firms push to become more data-driven, they are discovering it’s more difficult than anticipated, perhaps even impossible to achieve. The reason is that their tech infrastructure is hindering them.

Historically, many investment managers have adopted a “best-of-breed” approach to their platforms, where separate systems have been deployed along the way for specific asset classes and parts of the value chain. As a result, data reconciliation needs, interfaces, and workarounds have increased proportionately.

To keep disparate best-of-breed systems running, you need an IT department full of people in traditional roles like Database Analysts and System Architects. The more separate IT systems you use, the more of these roles you need to fill. Companies with best-of-breed infrastructures can have numerous systems, requiring a small army of people to handle the manual tasks necessary to get data flowing throughout the organization.   

In Operations there is a similar story. Standalone best-of-breed systems complicate processes, which increase the need for administrative roles. All these people – the firm’s human capital - are busy doing manual, administrative, and dare we say, boring tasks that do nothing to further the organization’s data-driven goals.

The war for talent

To exploit the data they already have, or can glean in the future, investment managers need more people with titles like Data Analyst, Data Scientist, Business Intelligence Analyst. These people are in demand right now and will continue to be so, and as such, have a huge premium attached to their heads.

How will senior management and/or shareholders react when they’re told they need to increase labor costs in order to attract the talent required to build the streamlined, efficient and data-driven organization of the future, which they need to deliver on their business strategy?

Even if they are able to fund such a transition, will the people with the desired skillsets want to work for them? These tech-savvy young people are also being lured by every other industry and by firms offering work environments much more suited to their preferences, beyond the clichés of ping pong tournaments and chillout zones. These firms are instead offering the meaningful, rewarding and life-enhancing work that these generations seek.

Future infrastructure and workforce requirements

We think a deeper dive into the requirements for a future workforce is required. Where will headcount be allocated? What roles will they perform? If headcount in IT and Operations will be reduced, how will best-of-breed infrastructures survive? Your executive leadership wants to be proud of a well-run organization, your clients want efficiency and customization to their needs, and your workforce wants to you to provide an environment that matches their expectations.

We also believe a prerequisite for transformation into a data-driven organization is a simplified and integrated operating model. This will enable organizations to free up headcount and reduce manual tasks, in turn allowing new roles to flourish and attract the workforce of the future and the exploitation of data to begin.