What are forthcoming key trends that will shape the Wealth Management and Asset Management industries, and specifically what are we likely to observe in the client reporting space as a result of these trends and business pressures?

The following short text is an extract from a larger research led paper outlining the forthcoming challenges for investment firms. The paper outlines how current client reporting solutions will need to adapt such that investment firms can remain profitable despite these challenging trends and business pressures.

Illustration of 2017 - Opus Nebula

As you will see, it really is the case that firms will have to improve their client reporting, in terms of content, personalisation and timeliness, whilst spending less money. How can this be done, read on…

Trend and Challenge – one

Reduced fee revenues, firms need to reduce costs to maintain profitability

There are predicted to be a number of reasons why fee revenues will be under pressure in future, these include:

  • Global AUM growth is slowing
  • Investment firms appear to be over-estimating AUM growth
  • Fee growth will not increase in line with expectation
  • Increased fee transparency is likely to drive down fee levels

Fixed operational costs need to be replaced with variable (and lower) costs to compensate for the lower fee revenue, such that profit levels are maintained or increased.

Trend and Challenge – two

Ageing, in-flexible legacy systems that are becoming more expensive to maintain and enhance, and more challenging to properly service clients’ reporting requirements.

Old and in-flexible reporting systems will become increasingly expensive and time-consuming to enhance and develop in order to provide high quality, timely reports and content to clients.

In the event that investment in systems in not undertaken, firms will have to either add further people to the process or reduce/limit the reporting offered to clients.

The aged and inflexible reporting systems need to be replaced with a reporting solution that provides high levels of flexibility, high quality and timely cost effective reporting, as well as reducing the cost of change, and time to market.

Trend and Challenge – three

Investment firms need to focus on core business activities; managing money and servicing clients and not expend effort and resources on other non-core activities.

In future investment firms will need to focus on core activities, such as managing money and servicing clients. Being distracted by undertaking other non-core activities may create inefficiencies within the firm and incur additional cost, whilst delivering a substandard solution.

Investment firms need to rely on external expert firms to provide the required services. For instance the costs and effort to maintain and develop the required technical infrastructure and systems for client reporting can be shared with other organisations and be managed and remain up to date, without the investment firm having to manage, control and pay directly for these activities. Significant cost savings can be generated via this model as well as gaining access to expert resource and solutions.

Trend and Challenge – four

Clients needing faster delivery of more tailored reports and content.

Investment firms will need to “do more with less” in the future. This is always going to be a challenge.

Investment firms need to provide high quality, relevant and tailored reporting to clients in prescribed and shorter timeframes. With aged and legacy systems this becomes increasing difficult and costly, and in the extreme, impossible, as simply adding people to the process is unlikely to provide a scalable solution.

The solution to all these challenges

Investment firms need to “do more with less” in terms of:

  • Reduce their fixed costs, e.g. system and infrastructure costs and replace fixed costs with variable costs, based on their use
  • Improve their reporting capability, including the efficiency and scalability of the reporting system, the flexibility of the system and the ability to automatically create personalised reports for individual client requirements
  • Be more operationally efficient and insensitive to volume, such that client reporting can be highly automated and is managed by exception

Reporting from highly automated, well configured and flexible systems allows for high quality, accurate and content rich reporting to be provided quickly and simply via automated workflows and processes.

The Opus Nebula “Reporting as a Service” solution allows wealth and asset managers to self-service their clients’ reporting requirements. As well as providing dynamic reports that flex depending on the data being reported and the client or fund being reported on, the system allows users to make specific reporting changes by the single click of a button.

The Reporting as a Service has fixed set up fees, and operates a pay-per-use model. The time to market is weeks, not months or years, and due to the inherent flexibility of the solution any on-going enhancements or new requirements are quick, cost effective and straight-forward to implement.

Opus Nebula are client reporting domain experts, our Reporting as a Service solution is securely hosted in the Microsoft Azure cloud. Our end to end reporting solution is pre-built and requires simple configuration to accept your data and produce reports precisely configured to your requirements in terms of content, layout and branding. All this is controlled and managed by your reporting team, using our simple to operate user dashboards.

Sound too good to be true? Explore www.opus-nebula.com or contact [email protected] for more details and to arrange a demo of the solution.

Andrew Sherlock
Opus Nebula