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04 September 2018

How Asset Managers Benefit from a Multi-Consumer Data Model

The collection, management and deployment of ever-greater volumes of data and information has become an asset management focal point.

According to the July BAIN Insights intelligence piece, “the decline in profitability has accelerated the demand for technology investments that will simultaneously offer new types of value-adding products and services to customers and increase process efficiency and capability.”

Given these market trends, firms that can efficiently manage and leverage available internal and external data flows are gaining a significant competitive edge in the battle to outperform their peers, deliver exceptional client service, satisfy their compliance obligations and reduce costs. The big challenge though is how best to manage, extract and deliver this information gold. We’ve seen that this is where many organizations struggle. Often that struggle starts with managing accounting data for multiple asset classes, in multiple systems, across multiple teams.

Common infrastructure problems

In our experience, firms’ problems typically stem from the lack of an integrated technology infrastructure that allows accounting data to be managed, controlled and disseminated. The most common issues we see include:

  • Excel and local data stores – where data is siphoned off into often undocumented and little understood individual desktops, databases and departments.

  • Siloed data – producing data views that are inward-facing and application specific, based on an IT infrastructure bought for a particular purpose.

  • Spaghetti infrastructure – where firms are wrestling with a sprawl of systems that have evolved over time (and often made worse by M&A activity), in which accounting data is moved around this point-to-point infrastructure, creating a high risk of it being changed or corrupted.

The multi-consumer model

By contrast, a multi-consumer model – where flexible solutions leverage a single dataset to serve multiple constituents – enables assets managers to deliver higher quality accounting data in near or real time across the firm in a scalable and extensible way, without incurring high costs or the need to add headcount.

With this single accounting dataset infrastructure, firms can provide multiple views that match the needs of its different data consumers, on demand and at the level of detail they require. These include:

  • Accurate and timely investment views for portfolio management and investment decision support, helping staff to take advantage of trading opportunities and minimize risks.

  • Portfolio accounting views for faster NAV and period-end processing.

  • An operational view for enhanced reconciliation support.

  • More accurate and granular performance views for internal rate of return and time-weighted return.

By working off a single data source that can support multiple consumers, firms no longer need to maintain numerous copies of the same accounting data in different solutions, or implement controls to ensure it remains consistent across the enterprise.

In addition, they can significantly reduce their integration and data portability requirements, and avoid a lot of the overhead that comes with moving data across the firm – not to mention the indirect costs associated with errors, manual processes and inefficient systems.

One of our clients, a large US-based asset manager, recently won Celent’s award for Core Transformation with a successful implementation of Geneva to reduce risk, consolidate systems for asset class coverage, streamline processes and improve efficiency.  Data you can trust, available when you need it.