Jessica Bauly (Governance.com): Redefining Digitalization - the New Resilience
As the tide of digital transformation rises in the asset management industry, Jessica Bauly of Goverance.com discusses how to surf the digital wave. Urgent actions to remain resilient include meeting clients’ demands for improved digital experience, maintaining competitiveness by using technology to gain efficiencies and save costs, and focusing on ‘human centricity”- deploying technology that resists replacing humans.
Why do asset managers need to “surf the digitalization wave?”
Especially in this challenging economic backdrop, the asset management industry acknowledges that digitalisation is a critical way to save costs and remain competitive. Economic volatility has become the new norm; digitalisation the new resilience. Those that take action fast, to digitalise their regulatory processes, will save time and money, steer well away from regulatory fines, and stand out to the end customer as offering an enhanced, digitalised client experience. Yet most of the industry, be it ManCos and AIFMs, Depositaries or Fund Administrators, still has far to come to turn digital ambition into reality. 97% cite digitalisation as a top priority (with a majority citing client expectation a key driver), while only 2% define themselves as “digital leaders”, (Research report, Alpha FMC, 2022). Governance.com is celebrating its 10 years of innovation for the asset management industry. 10 years ago, there was no “quick-fix” technology on the market to help compliance teams stay on top of their ever-increasing regulatory burden. Today, we are part of a mature FinTech and RegTech ecosystem. A compliance manager can reduce their workload for some tasks using the right technology, from several hours’ work down to a few minutes. Resilience today is about surfing this digitalisation wave. It’s about staying ahead and on top, not drowning under regulatory checks still built on outdated, more “manual” legacy systems (like email exchange of data related to funds and sub funds, stored and updated using static Excel sheets).
“Our greatest satisfaction comes from the sixth sense we have for what clients need next – both technically and culturally - to progress their digitalization journeys”
What do you advise asset managers in their digitalization mission?
We see three ways the industry can fulfill its digitalization ambitions: Setting and sharing a clear vision and ambition; aligning its IT and business strategies; and progressing one process at a time. Despite some internal resistance it is already happening: There has been a digital investment uptick in the industry with almost 40% intending to significantly increase their long-term, digitalization investments.
What’s on the digitalization horizon for the asset management industry?
The days of keeping everything in-house are over. Financial institutions can partner with specialised RegTechs and FinTechs to fulfill their operational needs –this ecosystem is only set to grow. We are also welcoming the return of “human centricity.” Deploying more technology is not about replacing humans: It's about freeing people from high-volume manual tasks to more value-added tasks. We also see a shift towards more human, in-person interactions again post-pandemic and as a healthy counteraction to the incredible rise of technology deployment in general, let alone the metaverse. Our own clients are showing an increasing appetite for in-person, small-scale events and our hands-on approach to project-management. Our greatest satisfaction comes from the sixth sense we have for what clients need next – technically but also culturally - to progress their digitalisation journeys. No technology will ever be able to replace such dynamics – it can enable and help strenghtn our relations, yes, but replace our relations, no.