Can Fund Administrators Buy Time? The Answer is Yes.
Warren Buffett famously once said, “I can buy anything I want, basically, but I can’t buy time.” The Oracle of Omaha was right. No amount of money can add another hour to the day. But what if fund administrators could buy time for their employees and their clients?
Fund administrators have become accustomed to certain tasks taking set amounts of time. It might take two weeks to onboard and reconcile financials for large clients… Or it might consume 105 minutes to process financials from a single investor.
It’s easy to take these times for granted. But innovations in data intake, processing and reporting are transforming them. Harmonate’s flagship enterprise product, Conductor, is on record taking onboarding and reconciliation for a large client down to 24 hours (saving some 13 days) and the time to process a single investor’s financials down to minutes (saving 1.5 hours.)
In other words, Conductor helps financial administrators buy time. So, what would you do with two weeks returned to your team’s calendar? Or ask yourself: What would you do if your competition had two weeks that you did not?
As in other specialized fields like health care, machine learning in fund administration is not replacing the institutional knowledge that is so crucial to success. Rather, asset manager are deploying it to speed up the processes that absorb time but don’t add value to the bottom line. And the number crunchers on fund teams — the accountants, analysts and quants — are using machine learning to move faster from data intake to actionable insight.
A smart data system can automate data and document ingestion as well as aggregate and normalize data from various sources. It can also constantly check data for accuracy, facilitate faster reporting and pave the way for reliable, real-time digital dashboards.
Funds have been shielded from some of the digital disruption happening in other industries. More than a decade of almost uninterrupted economic growth has certainly helped reinforce the status quo, along with client relationships that are less fickle than other sectors.
But the competitive advantages of digital innovation in investing are now obvious, signifying opportunities for tech-savvy fund administrators and the diminishing relevance of those that resist the tide of change.
Today, it’s not hard to find fund managers whose “data operations” still consist of emailing Excel spreadsheets and employing humans to input numbers into the general ledger. That just won’t work in a few years, as investors start demanding faster and more transparent reporting. It’s probably not working well now but firms are putting up with it, shortsightedly saving on the costs of change management while losing ground overall, especially when fees are under downward pressure.
Upgrading data systems isn’t only about buying time. It’s about empowering teams to make better decisions, deliver better returns, and create lasting relationships with partners. It’s an investment that will pay increasing dividends over time.
Fund administrators won’t be able to overhaul their data systems overnight. But those that start their data journey now — and commit to digital innovation in the years ahead — will be handsomely rewarded for the time they are buying along the way.