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Owning Strategy – and Delivery!

Asset management firms don’t come into existence fully formed. As with any industry, they typically start from a modest base and grow organically over time as business (hopefully) grows and AUM increases. An asset manager’s functional evolution develops in a similar fashion. Typically, the firm starts with a set of core functions like Investment Management, Distribution and Operations and adds more esoteric products and functions as the business grows and becomes more complex.

An internal project team, frequently called a Program Management Office (PMO) or a Business Change team is one such example. In Asia’s growing economies, a trend we see with small to medium-sized asset managers – and even some industry leaders in their home countries – is that they are often late to the game in establishing this strategic corporate function.

Our experience suggests that most firms are not opposed to the idea of forming a project team but simply haven’t prioritized it or don’t see a clear cost/benefit for doing so. If your company is growing, then it’s a safe bet you have a list of strategic projects that are in some way intended to further your strategic objectives. For those Asian asset and wealth managers who haven’t made the leap to forming a dedicated internal project team, here are some reasons why we think now could be the time to do it:

  1. Change is the only constant.  Even in relatively static business situations, ‘care and maintenance’ and keeping up with market trends implies a certain level of change. If your plans are more ambitious, you will likely already have a set of strategic initiatives required to achieve those ambitions. To put it simply, there will never be a shortage of change to be addressed and your project team will never be looking for things to keep them busy. 
  2. Own your strategy – and your delivery of it. Many firms over-rely on vendors and service providers to deliver projects on their behalf. While the vendor/service provider community is highly reputable, their interests generally don’t extend beyond the specific product, service or solution they are implementing.  How their offering holistically interacts with your infrastructure is not their priority. In a broader sense, asset managers should take strong ownership of defining and delivering their own strategic objectives and a dedicated project team is a vital component in achieving that.
  3. Cost efficiency.  A project team is a cost center so it may seem counter-intuitive that it is also a cost saver. Most sizeable projects can benefit from external consultants, but in our experience selective use of higher-cost external expertise, working hand in hand with an internal project team, is not only more cost effective but also yields more successful project outcomes. A skilled project team that can manage external vendor / service provider / consultant relationships also saves valuable management bandwidth.
  4. Project delivery is a specialized skill set Smaller companies, by necessity, frequently deliver projects with BAU (business as usual) staff. While there are many project-savvy people out there, those in BAU roles are generally busy with a full-time job – keeping your company in business.  In addition, project roles and methodologies have evolved over the last 10-15 years into discrete specializations with well-defined methodologies, training programs, coursework, accreditations, etc.   
  5. Management reporting.  While having internal delivery capability may be the biggest benefit to your organization, it’s not the only one. Effective project management requires informative, concise management reporting. A standardized reporting regime extended across all of your firm’s strategic initiatives provides executives a ‘one stop shop’ to keep the pulse on one of your most important objectives – realization of your strategic ambitions.

Even in the fastest growing region in the world, asset and wealth managers can’t simply expect to succeed by following the aphorism that “a rising tide lifts all boats”. Well thought-out strategies are more important now than ever. But a strategy alone achieves nothing if it can’t be realized. Shoreline believes that establishing a dedicated project team is not an if, it’s a when, and for up and coming firms (or even established firms) that have yet to do so, you should ask yourself if now is the time.

James Baker

Director

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