A change of mindset
04 Jan 2021
The shift from manual processes to automation is now more than ever seen as critically important. Fenergo’s Kevin O’Neill explains the last couple of months have highlighted that firms really need to embrace this transformational approach
Image: Fenergo
What are the biggest industry challenges facing transfer agency and fund administration firms globally?
The first thing, the pandemic has really shaken up the industry over the last number of months. Globally, the industry has been dealing with the fallout from this and it has raised a number of issues, particularly around how well businesses are prepared in terms of business continuity planning (BCP), disaster recovery, etc. and what processes are in place today to de-risk and mitigate against an event like COVID-19 happening.
A lot of businesses are re-examining their BCP, and how they can provide workers with a better working experience. As a result of this, some companies will become more operationally efficient in terms of how they manage their various books of businesses. The whole shift from manual processes to automation is now more than ever seen as critically important. Automating regular client reviews, risk assessments and regular maintenance requests will become the norm.
All of these tasks can be streamlined today through the use of technology and the last couple of months have highlighted that people really need to embrace this transformational approach.
Do you think the pandemic has helped to prepare firms for similar future events?
It is absolutely phenomenal the changes that will come out of this, particularly around improving client and investor journeys and the ability to be able to offer fund administration and transfer agency customers a streamlined digital and remote experience. This will allow them to provide data and documents in a more digitally efficient manner and avoid all the duplication of information requests that goes on in terms of reaching out to clients for data and documentation.
Moreover, I think by automating a lot of the investor regulatory rules, you are de-risking the experience for the customer, your business and from a regulatory compliance point of view as well. We have already seen so much transformation in the last six months that would normally take two to three years to complete.
Many new regulatory deadlines have been pushed back due to the pandemic yet regulatory change management is often slow and reactive. How can firms ensure they are adequately prepared?
When you consider all the regulatory reforms that are taking place, particularly around anti-money laundering (AML) and know-your-customer (KYC) rules, not just in Europe but in the US and globally, regulatory change management has become front and centre for every organisation. Even if there has been a slow down due to disruption from the pandemic, a lot of firms have used that time to fine tune their processes and see how they can automate a lot of those various different tasks. By tapping into the knowledge that is available via regulatory communities, they are speaking to practitioners within different markets to get an operational context on how best to adapt and change for those regulations. So, while things have slowed down on the regulatory side, this has been really good in terms of organisations using this time to become more disciplined and focused in terms of leveraging technology to address these regulatory pain-points.
In terms of client and investor onboarding, what are the key everyday hurdles impacting time to revenue?
It is all about the communication trail – for example, it’s extremely frustrating for customers to receive multiple requests asking for documentation that has been previously supplied to another part of the business months ago. Leveraging the ability to provide a full 360-degree view of all the customer’s information in an electronic format is absolutely critical. In addition, you need to be moving to managing on an exception basis, enabling a good bulk of your regular KYC reviews to be fully automated.
From the speed to market point of view, we are seeing a move towards integration with CRM solutions such as Salesforce and Microsoft Dynamics. This enables the front office to kick start the onboarding process and collaborate seamlessly with middle and back-office operations, without leaving their CRM experience, as well as utilising integrated client portals to easily request data and documentation from the end client/investor.
Why is it important to digitalise the end-to-end investor onboarding experience?
Filling out paper forms is a thing of the past, especially for millennials and generation X. They want an experience the same as when they walk into an Apple store or when they subscribe to Netflix where it’s only 10 or 20 different clicks to get their required product or service within a rapid period of time. Financial services are on a transformation journey to expedite operational processes but I think organisations are starting to make those changes now to digitise their various end-to-end customer journeys.
These investor onboarding journeys represent the bulk of their onboarding requirements, but we have also seen onboarding of distributors and other counterparties transform from paper to digital journeys.
Looking to the future, what technologies do you think will offer the greatest efficiency gains for asset servicing firms?
From a client lifecycle management (CLM) perspective, it is getting the core basics and fundamentals right around AML and KYC, digitising those investor counterparties or distributor journeys and automating risk assessments and regulatory rules. Today, we have regulatory rules for over 120 different jurisdictions across the globe embedded in our solution. This helps automate those regulatory journeys which are critical.
The big area which I see as the fastest transformation piece is what I call an application programming interface first strategy. This enables our solution, for example, to surface and integrate with CRM solutions like Salesforce and customer portals in order to speed up that onboarding process in a compliant fashion but also deliver better client experiences and operational efficiencies for the organisation.
Keeping those core principles in 2021 will be critical. Adoption of automation within this space is in its infancy and organisations are slowly adopting new technologies but I see this accelerating over the next few years.
The first thing, the pandemic has really shaken up the industry over the last number of months. Globally, the industry has been dealing with the fallout from this and it has raised a number of issues, particularly around how well businesses are prepared in terms of business continuity planning (BCP), disaster recovery, etc. and what processes are in place today to de-risk and mitigate against an event like COVID-19 happening.
A lot of businesses are re-examining their BCP, and how they can provide workers with a better working experience. As a result of this, some companies will become more operationally efficient in terms of how they manage their various books of businesses. The whole shift from manual processes to automation is now more than ever seen as critically important. Automating regular client reviews, risk assessments and regular maintenance requests will become the norm.
All of these tasks can be streamlined today through the use of technology and the last couple of months have highlighted that people really need to embrace this transformational approach.
Do you think the pandemic has helped to prepare firms for similar future events?
It is absolutely phenomenal the changes that will come out of this, particularly around improving client and investor journeys and the ability to be able to offer fund administration and transfer agency customers a streamlined digital and remote experience. This will allow them to provide data and documents in a more digitally efficient manner and avoid all the duplication of information requests that goes on in terms of reaching out to clients for data and documentation.
Moreover, I think by automating a lot of the investor regulatory rules, you are de-risking the experience for the customer, your business and from a regulatory compliance point of view as well. We have already seen so much transformation in the last six months that would normally take two to three years to complete.
Many new regulatory deadlines have been pushed back due to the pandemic yet regulatory change management is often slow and reactive. How can firms ensure they are adequately prepared?
When you consider all the regulatory reforms that are taking place, particularly around anti-money laundering (AML) and know-your-customer (KYC) rules, not just in Europe but in the US and globally, regulatory change management has become front and centre for every organisation. Even if there has been a slow down due to disruption from the pandemic, a lot of firms have used that time to fine tune their processes and see how they can automate a lot of those various different tasks. By tapping into the knowledge that is available via regulatory communities, they are speaking to practitioners within different markets to get an operational context on how best to adapt and change for those regulations. So, while things have slowed down on the regulatory side, this has been really good in terms of organisations using this time to become more disciplined and focused in terms of leveraging technology to address these regulatory pain-points.
In terms of client and investor onboarding, what are the key everyday hurdles impacting time to revenue?
It is all about the communication trail – for example, it’s extremely frustrating for customers to receive multiple requests asking for documentation that has been previously supplied to another part of the business months ago. Leveraging the ability to provide a full 360-degree view of all the customer’s information in an electronic format is absolutely critical. In addition, you need to be moving to managing on an exception basis, enabling a good bulk of your regular KYC reviews to be fully automated.
From the speed to market point of view, we are seeing a move towards integration with CRM solutions such as Salesforce and Microsoft Dynamics. This enables the front office to kick start the onboarding process and collaborate seamlessly with middle and back-office operations, without leaving their CRM experience, as well as utilising integrated client portals to easily request data and documentation from the end client/investor.
Why is it important to digitalise the end-to-end investor onboarding experience?
Filling out paper forms is a thing of the past, especially for millennials and generation X. They want an experience the same as when they walk into an Apple store or when they subscribe to Netflix where it’s only 10 or 20 different clicks to get their required product or service within a rapid period of time. Financial services are on a transformation journey to expedite operational processes but I think organisations are starting to make those changes now to digitise their various end-to-end customer journeys.
These investor onboarding journeys represent the bulk of their onboarding requirements, but we have also seen onboarding of distributors and other counterparties transform from paper to digital journeys.
Looking to the future, what technologies do you think will offer the greatest efficiency gains for asset servicing firms?
From a client lifecycle management (CLM) perspective, it is getting the core basics and fundamentals right around AML and KYC, digitising those investor counterparties or distributor journeys and automating risk assessments and regulatory rules. Today, we have regulatory rules for over 120 different jurisdictions across the globe embedded in our solution. This helps automate those regulatory journeys which are critical.
The big area which I see as the fastest transformation piece is what I call an application programming interface first strategy. This enables our solution, for example, to surface and integrate with CRM solutions like Salesforce and customer portals in order to speed up that onboarding process in a compliant fashion but also deliver better client experiences and operational efficiencies for the organisation.
Keeping those core principles in 2021 will be critical. Adoption of automation within this space is in its infancy and organisations are slowly adopting new technologies but I see this accelerating over the next few years.
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