Increasing Operational Efficiency the #1 Focus for Asset Management

Insights, September 26, 2018

Temenos – Company

Latest Temenos Multifonds Every Fund Survey finds:

• 90% of the asset management industry think operational efficiency will become increasingly important
• However, 94% said technical innovation in operational support needs to accelerate
• Supporting new asset classes highlighted as the top value-add area asset administrators need to focus on

GENEVA, Switzerland – September 26, 2018 – Temenos (SIX: TEMN), the banking software company, today announces the launch of its latest Temenos Multifonds Every Fund Survey, this time looking at operational efficiency – how fund managers and asset administrators can unlock value from operational systems, open up new opportunities, and reduce costs.

In a global survey of 100 asset managers, custodians, third-party administrators and professional service providers, Temenos identified that increasing operational efficiencies is a key priority for asset management. An overwhelming 90% of respondents said that operational efficiency will become an increasingly important focus, with a further 91% saying that improving operational efficiency plays an important role in increasing profitability. In terms of the industry’s focus on innovation over the next 12 months, operational efficiency was highlighted as the #1 priority, followed by product development, digital channels and risk management.

However, the survey also showed that technological innovation in operational support is not keeping pace, with 94% of respondents saying it needs to accelerate, and 1 in 4 saying that fund administrators and transfer agencies are not currently keeping up with the requirements of asset managers. To close this gap, 92% of respondents said that third-party technology providers have an important role to play in accelerating technical innovation.

The survey also asked respondents to rank in order of priority the key areas of innovation that asset administrators need to focus on – the findings were:

• #1  Supporting new asset classes (e.g. ETFs)
• #2  Unlocking insights through data analytics
• #3  Opening up new markets and jurisdictions
• #4  Increasing the speed to adapt to regulatory change
• #5  Shortening the time period to produce NAVs
• #6  Increasing client oversight and control

Commenting on the findings of the Every Fund Survey, Oded Weiss, Managing Director of Temenos Multifonds, comments:

“Improving operational efficiency is now a key priority in asset management, and an important driver of profitability. However, the demands from asset managers on third party service providers have changed due to a combination of factors – competition through digital channels such as robo-advice, increasing regulatory standards necessitating a move to real time oversight, combined with increasing cost pressures as expense ratios have continued to fall.

“To keep pace with the demands of the industry, third party administrators now need to invest in the technology, data and services to help asset managers compete in the digital world, by opening up new asset classes, unlocking insights from data, improving the user experience, and increasing oversight and control.”