Against the backdrop of macroeconomic challenges, global asset managers are facing a dilemma, as falling revenues across the industry in 2022 hit both management and performance fees, while the need to spend on technology upgrades to enable growth and serve clients continues unabated. How does a firm manage costs, boost profitability and support client needs simultaneously?
Institutional asset and wealth managers should take a close look at upgrading operational systems as a way to reduce costs and advance effectiveness through the latest technology. A good candidate for upgrading is the reconciliation process, for which many firms still employ a time-consuming and risk-laden process, where spreadsheets and manual work make for an inefficient and unsustainable approach that severely limits firms’ profitability, service and growth.
Automating reconciliation processes and implementing exception-based workflow best practices offers firms easy wins in the quest for greater productivity, performance, efficiency and profitability. Replacing an error-prone, manual file-matching process or creaky legacy system with a time-saving, accurate and automated environment offers significant advantages on multiple fronts.
An effective reconciliation environment requires a solution that can capture, validate, match and report data from a wide range of internal and external sources. And when breaks occur, a sophisticated solution will assist the exception management process by automating as many functions as possible, thereby increasing efficiency, cutting costs and reducing errors.
Where should asset and wealth managers begin on their journey to reconciliation optimization?
Introducing automated, exceptions-based processes to reconciliation—with all the cost reduction, error minimization and scalability advantages it brings—is one of the most effective ways for wealth and investment managers to gird themselves for whatever changes and challenges lie ahead. While automation in itself may be no guarantee of success, a scalable and repeatable process will provide the foundation for stability and growth.
Download our "SS&C Aloha Recon – Reconciliation Reimagined and Automated" brochure to learn more about our new and highly innovative investment reconciliation solution that reimagines investment operations and provides for streamlined operations and lower total cost of ownership