While middle office transformation remains a priority for asset managers, many are realizing that there is a direct correlation between success and their data capabilities. Consequently, more firms are prioritizing data at the start of their transformation journey – but not all are realizing the intended benefits.
Olmstead recently conducted a survey to gauge how asset managers view the importance of data when transforming middle office. The following outlines key insights and considerations to maximize the business impact of your transformation.
Transformation Remains Prevalent
A vast majority of survey respondents indicated being actively or on the cusp of a middle office transformation. Likewise, nearly every respondent has also embarked on projects related to data and the cloud; with most being in the early stages. Not only does this reinforce the prevalence of transformation activity across the industry, but it also highlights how data is top of mind for asset managers and reinforces the connection between data and business transformation. This connection may be attributed to how expected business outcomes have evolved when it comes to transforming middle office.
Business Outcomes Have Evolved – Data Has Become Front and Center
The survey highlighted that traditional business drivers, such as achieving operational scale, reducing cost, the ability to launch complex products and expedite access to new markets/asset classes are evolving. While these drivers remain very much relevant today, improving the end-to-end data lifecycle and enabling end-users with a modern toolset to manage or mine data have also emerged as expected outcomes. The survey results attributed this to senior management embracing data as an asset, making data transformation a key organizational priority, and championing cloud technology.
Expectations are Falling Short
While the perception of data quality was high amongst most survey respondents, many continued to suggest that their data-related goals, particularly end-user enablement, are going to fall short of expectations – mainly because business transformation is not aligned with the organization’s data strategy. In other words, their data strategy is not fully enabling their business strategy. End-users are still struggling to find the data they need and lack a holistic view of what and when data is available for consumption. This can be attributed to multiple factors related to project execution that leaves inconsistencies in how data is managed and business users resorting to legacy practices instead of adopting new capabilities.
Recognizing the importance of data in business transformation is a great first step, but expectations will continue to fall short without the appropriate follow-through. Consider the following to maximize your results.
- Establish clear, achievable success criteria that align the data strategy to key business outcomes from the start; ensure its socialized across the organization, continuously monitored, and prepared to adapt as needed.
- Avoid the replication trap by adopting a more data-forward approach to defining the operating model; ensuring that solutions are solving end-user data needs and directly addressing the risk associated with legacy practices.
- Embed business users into the program to understand existing data flows and elicit feedback early and often on the viability of new data practices/tools to ensure adoption.
- Define data monitoring and governance best practices, then engage the business to identify data stewards and owners that are accountable for ensuring they persist.
Olmstead has the expertise and a proven data-centric approach to lead asset managers through their middle office and data transformation journeys. Reach out to us today to discuss how Olmstead can help your firm maximize results and achieve your business objectives.