Digitizing the investor experience

Putting the tech to work: Getting ahead instead of just catching up

Like the business world at large, technology is currently enabling an upheaval in the financial services industry. Financial firms are making up for lost time, having lagged behind other industries as they focused on operational efficiency rather than innovation. Acquiring clients has become more challenging and costly as competition increases, sparking renewed interest in improving the client experience.

With much of the asset management ecosystem now focused on digitization and how it can improve the client experience, we are seeing how intelligent data strategies have the potential to shorten onboarding times, increase portfolio transparency, ensure greater cybersecurity, and even anticipate client needs.

What does transformation look like?

Data is the primary force behind the current interest in digital transformation. More so than many other types of businesses, asset managers stand in a unique position at the nexus of multiple (and massive) data sets. Client data is a key part of the equation, joined by market, economic and their competitor’s data. The prospect of integrating these data streams in useful ways drives companies to transform their businesses into what Deloitte calls “information-centric, analytics-driven, and agile data consumers,” in a 2016 report.

Effective digitization cannot happen tactically if transformation alone is the objective. It is crucial to understand the experience from an investor perspective before you can identify changes to systems and processes. Similarly, trying to layer or integrate new technologies on a foundation of older outdated ones is not advised.

With new technology comes a new mindset. As data becomes increasingly central to your value proposition, there needs to be greater emphasis across the organization on making sure that data is accessed more easily and intuitively enabling for quicker insights to be derived.   .

Who is driving change?

Three distinct groups, each with their own needs, are driving digital transformation.


  1. Investors. While portfolio performance is at the top of an investor’s wish list, increased transparency and better communications are also key. 24/7 online access to their accounts, customized reports and detailed analysis, all the while protected from cyber-fraud and hacking, are no longer optional benefits, but are now simply expected.
  2. With increased competition, differentiation has never been so important and managers are now expected to clearly demonstrate their value. Particularly with self-service functionality, faster response rates and improved data management capabilities, technology now enables managers to deliver a more proactive, knowledgeable and differentiated experience to their investors.
  3. Regulators. Regulatory bodies are also focusing on the digital operating environment, shaping the investor experience as they go. But even the most carefully designed investor experience is worth nothing if it does not comply with existing regulations. With the regulatory and data security landscape changing so quickly, technological flexibility is critical to handle the demands of an increasingly complex and globally fragmented regulatory landscape.

Redesigning processes go part of the way in addressing these needs. The investor experience should be as streamlined as possible, with other stakeholders introduced at the appropriate time. If data is captured cleanly and efficiently, it not only provides for more customized reporting but enables managers to focus on higher value solutions as well as simplifying regulatory and compliance reporting.

Put technology to work

Data drives transformation, but the emergence of certain tools and trends has given it life. Asset managers sit in the midst of vast overlapping pools of data containing information on market movements, investor behavior, government filings and demographic trends, to name a few. Application Programming Interfaces (APIs) provide a way for much of this data to be tied together, and successfully aggregating data is a powerful first step in analyzing it in search of a competitive advantage. Additionally, through the use of artificial intelligence, cognitive computing and machine learning, firms may also see an improvement in portfolio decision-making, better risk management, improved client communications and increased operational efficiency.

The leap from surviving to competing

The benefits of digital transformation are indisputable. According to a 2017 study by the SIFMA Asset Management Group and Broadridge, clients benefit from faster, better, nimbler and less costly asset management operational processes (that) result in…improved reporting, access to more diverse products and lower fees. The same report revealed that 80% of operations managers surveyed see significant opportunity for innovation in data management.

But how fast can the investor experience be expected to change? Industry executives generally expect transformative results relatively quickly. Six out of ten, for example, believe that big data initiatives would deliver transformative results within a year, while Forbes Insights and Cognizant cited that 55% believe the same regarding mobile applications and solutions.

Initiating the process of digital transformation can be unnerving and a formidable undertaking, but a very real danger exists in not doing anything. Firms not using today’s technologies to transform customer strategies, relationships and experiences are at risk of disruption or obsolescence.

Ross Ellis is VP of SEI’s Investment Manager Services.