Investment Management System Selection – Positioning for Success

Every year the global buy-side industry spends millions of dollars in new investment management system selections and implementations. Selecting the right investment management system (IMS) is an important decision for any investment organisation as it is typically a multiyear commitment and represents a large ongoing spend for an organisation.  

Selecting and implementing a system is often a period of significant upheaval requiring the mobilisation of the entire firm. Boards and executives are keen to ensure that not only is the right decision made, but the process is run with as minimal impact on the firm as possible.

Shoreline has undertaken countless selection processes for asset management solutions and service providers and have fine-tuned our method to assist firms in selecting the best fit for their circumstances. This experience has given us a thorough understanding of how to avoid the many traps and pitfalls organisations fall into when selecting and implementing an investment management system. 

We have found that ensuring that key building blocks are put in place at the beginning of the selection and implementation project increases the likelihood of success and potentially reduces the amount of regrettable spend.  

These building blocks include:

  1. Have an appropriate project sponsor – Define an appropriate project sponsor at the start of the project, preferably a COO or CIO. With any project there will come points where bottlenecks occur, key stakeholders need to be managed and adjudication required. There is also requirement to present project recommendations to boards including funding requests. With a project such as this the CIO or COO is often best positioned senior executive to undertake this important role.
  1. Get the front office engaged – Engage front office stakeholders early and take them on the project journey. The keys to success of any IMS selection and implementation project are the front office teams, after all they will be the ones using the system. Communicating early and often is critical. Often we see push back from front office teams, particularly if they cannot see the requirement for change or they baulk at the time commitment required for the project. We have found that by engaging these teams early and often the likelihood of success is increased significantly.
  1. Communicate the project scope – All too often we see poorly defined project scope resulting in project teams getting bogged down or experiencing dreaded scope creep. This can prove to be very costly and result in regrettable spend. Clearly defining and communicating the project scope is key to ensuring the focus is on selecting an IMS that is fit for purpose. For the projects we run this is always done at the kick-off meeting to ensure everyone agrees the plan.
  1. Resourcing can make or break a project – Ensuring there are enough resources devoted full-time to project. Do not underestimate the scale of a selection project. Projects of this size and complexity can require significant resources. All too often we see projects where the project teams are under resourced resulting in costly overspend as things fall through the cracks. To mitigate this risk, we would recommend the establishment of a core project team for the duration of the project to guide it to success.
  1. Plan the implementation early – Right at the start of the selection project the implementation planning process needs to be front of mind. Undertaking implementation planning and costing early in the process ensures the right questions are asked of a vendor before a selection is made. This reduces the potential for costly surprises down the track as potential implementation pitfalls can be identified and addressed early in the process

We may be accused of “talking our own book” here, however, projects such as these often require specialist expertise that is not found readily within organisations. Some of the most successful projects we have worked on are those where an organisation acknowledged early on that they needed help and brought in external expertise to run the project.

External experts can reduce the upheaval across the firm and avoid many of the pitfalls that can plague these types of projects. There can also be the potential for cost savings by avoiding having to unwind costly mistakes.

Shoreline can help. With a cross section of expertise in front office systems selection and implementation we have the necessary experience required to work with you to successfully manage transformational programs such as these. Please contact us if you require further information.

Chris Robertson

Associate Director

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