Nov 10, 2023

How a 'build everything at any cost' mentality holds asset managers back from executing AUM growth strategy

Asset managers need to think carefully about which differentiators they need to invest in to unlock AUM growth.

Luke Tones
How a 'build everything at any cost' mentality holds asset managers back from executing AUM growth strategy

At Aiviq, we are seeing relentless fee pressure and fierce competition forcing asset managers to really scrutinise which internal investments in new capabilities are worth funding.

As internal costs spike, markets remain uncertain and waves of headcount reductions are likely persist into 2024, senior executives at many investment firms have arguably never had more at stake when it comes to deciding which transformation initiatives are true strategic priorities.

The flip side of this is that market and technological innovation are creating new opportunities to create a clear space between asset managers and their peers.

Some examples we are seeing include leveraging applied data science to forge new investment or trading strategies, new product innovation to meet rising investor demand for Alternatives and Active ETF solutions or even the emergence of Generative AI to drive more personalised client experiences and content automation.

Let’s take one of Aiviq’s core capabilities as an example, sales attribution rules and trade splitting.

As a capability, the ability to accurately assign client flows to salespeople, teams and territories could be considered table stakes. It is a pre-requisite for making informed sales management decisions, calculating team compensation (for non-discretionary bonus structures) and evolving client and distributor engagement strategies. All managers must contend with the same problem, albeit coming at it from different starting points.

Working with some of the world’s leading asset managers, Aiviq invested nearly 2000 hours in building a rich and growing feature set to handle the different permutations of sales data, attribution rules and reporting use cases surrounding this problem. Furthermore, we are contractually committed to supporting the capability across our customer base for the long haul.

Where industry solutions for common industry challenges exist, asset managers must ask whether owning and operating proprietary answers offers a comparative advantage.

With the functionality to handle sales attribution, Aiviq customers have been able to bring forward aspects of their sales analytics roadmaps for over six months.

Some of the features our sales attribution module included early on included:

·       Multiple split rule types for automating AUM & Flow attribution

·       Trade claiming user workflow and approval queues

·       Advanced data validation, transaction lineage and audit

·       Real-time application of changes to split rules across historical periods

·       Creation of reversals to enable both TA Account and Sub-account reporting.

In practical terms, it has freed up in-demand data and technology resources to build more informative sales ‘next best action’ insights, enabled more accurate allocations of sales credits and fundamentally changed the map for senior leadership around where global AUM is concentrated by sales channel, region, and client – enabling different decisions about where to go next.

In parallel, industry answers that bake a multitude of ideas and perspectives into the design often include benefits that go beyond the immediate business need. Aiviq’s sales attribution feature, for example, helps Finance functions automate transfer pricing and revenue reallocations across business units – demonstrating, paradoxically, how external specialists can be a driving force in uniting internal teams and breaking down information silos through common solutions.

Aiviq's approach to building product-based answers to common industry client data challenges with our customers enables them to channel internal investment towards revenue-generating initiatives that help them stand out from the crowd.

👉 Contact Sales to find out more or to discuss common industry data challenges we should be examining on our roadmap.

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