Engaging Millennials – The Role Of Asset Managers (Part 3)

Blog - 06.09.2018


Put simply, asset managers (like the pensions industry in general) would benefit GREATLY from adopting a technology mentality in their operations. Rather than the general sense of inertia which pervades, managers should be seeking to build digital solutions quickly using an agile mindset with a dedicated commitment to refine their services regularly.

This might initially seem contradictory given previous comments on the cost pressures managers are facing – in the near-term, such things require investment and will drive up spending due to the need to invest in upgrading and introducing new systems. Nevertheless, this has to be considered on a long-term view. Technology offers the potential to reduce costs over time and managers have a significant opportunity to improve their core infrastructure, which would then enable institutions who have a direct route to savers to be able to offer attractive and flexible solutions which help those people engage better.

To some degree this has started but although that spending has begun, it’s far from being at the level required to make a real difference, meaning driving higher revenues are even more important. An Alpha FMC survey [1] earlier this year of 15 of the largest global asset management firms who collectively manage £7tn, revealed fewer than 10% are spending over £50m a year on digital projects. These amounts are dwarfed in comparison with the hefty budgets banks, such as J.P.Morgan who spent $9.5bn on technology in 2016, and other financial services groups devote to their digital projects.

Yet having modern, efficient IT systems and digital capability forms a critical base infrastructure for Asset Managers to run their operations efficiently and meet client and regulatory needs. Such capability could then allow Managers to act as key data providers for dashboards like Abaka and Moneyhub enabling savers to easily see a consolidated view of their investment accounts and savings. As the first truly digital generation, it feels like having this type of capability is essential, and if managers were seen to be proactively powering this it could improve their reputation with Millennials.

[1] Large fund managers skimp on digital spend – Financial News, April 24th, 2018

Looking for another entry in this blog series?

Part 1
Engaging Millennials - The Role Of Asset Managers

Part 2
Why Should Asset Managers Prioritise Engagement?

Part 3
Why Technology Matters

Part 4
Building Trust

Part 5
The Importance Of Sustainability & Education In Finance

About Tom Hibbard

Tom Hibbard (closeup)

As Head of Business Development for ClaritEx, Tom’s focus is on understanding the industry's ever-changing challenges, and bringing relevant stakeholders together to establish how new technologies can make a real difference to reporting in the pensions industry. Tom will use his knowledge of emerging technologies to create and deliver the governance solutions that Simplitium will provide for the pensions market. 

Formerly a Business Development Manager at KAS BANK, he has extensive knowledge of the global pensions industry landscape. During his time at the bank, Tom was instrumental in building the strategy and brand for the UK branch, playing a key role in establishing its position in the market and growing revenue.

About ClaritEx™

ClaritEx is the next generation pension cost data monitoring solution for the pensions industry. Powered by Simplitium, the service helps both DB and DC pension schemes access the information needed to make better investment decisions and meet increased governance obligations. In response to the ever-growing demand for greater transparency across UK financial services, ClaritEx provides comprehensive transparency of costs to the UK pensions industry. 
Cost transparency is achieved through a combination of innovative technology with a detailed and expert understanding of the investment value chain. By collecting consistent and comparable cost data from both schemes and their underlying service providers, ClaritEx delivers full assurance of costs to market participants in an industry which has, until now, struggled to achieve transparency. For further information, please visit www.simplitium.com/claritex