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It’s no secret that asset management firms use spreadsheets and email as tracking tools. Up to 75% of businesses use Excel for operations management and a surprising 70% use email for managing, archiving, and processing critical digital data.

Most large firms still use poorly managed spreadsheets or siloed emails when they build proprietary enterprise systems to address their needs. Small-to mid-size firms have been turning to software-as-a-service (SaaS) platforms. These are off-the-shelf systems intended to manage one aspect of their workflow that don’t integrate into other SaaS systems or replace the need for spreadsheets.

 

Why Spreadsheets Are a Disaster in the Making?

Spreadsheets were the holy grail of data organization for the financial industry. They provided a one-stop solution where you could organize thousands of records, sort through them with a click of mouse, create presentations and more.

Handwritten tabulations, paper manuals, and workflow charts-on-the-wall were tossed in the bin with the arrival of the new world of automated computing. It worked for a long time, until computers evolved to do even more things, faster and more efficiently.

Spreadsheets don’t have the flexibility to change when strategy changes—they all have to be rebuilt by hand to reflect the new idea. Even a solid system that takes data in and spits out the result has to be manually updated every reporting cycle. They have fallen far behind the newer approaches that reduce the risk of errors.

As the flow of data has increased, more people need access to that same data simultaneously. the spreadsheet is simply not up to that task because it can only be changed by one person at a time.

Security challenges also create situations where someone who requires the data on one spreadsheet cannot even look at it without having their credentials approved, one file at a time. All of this can cause workflow to grind to a halt in today’s real-time operating environments where even fifteen minutes down lies between success and failure.

 

Rigorous Archiving Demands Structure

The asset management world requires an avalanche of documentation and tracking. This relies on paperwork. It must be recorded in digital format, be accessible to meet legal standards, and internal company policies, and kept for process documentation.

These needs have produced an additional industry of data management providers along their software products. Despite all of this, many firms have cobbled together unrelated SaaS systems that are not designed to integrate and lock key decision makers out of the process when they need it most.

Firms turn to band-aid approaches to make it all work—those spreadsheets and emails—to try to keep staff informed. Investment managers, for instance, can take on average 18 minutes searching for a critical document.

Time is wasted finding the right program with the information or the right person who has the permission to access it. Infuriatingly, a busy professional will sometimes discover the document they need is only in paper form and filed somewhere. But where? They have no idea how to find it.

 

Increased Complexity Makes Spreadsheets Obsolete

The complexity of documentation in the financial industry can involve over a dozen entities sharing data in a single transaction.  Involved parties can include anyone from banks to custodians, internal officers, external managers, and counter-parties. Each element involved can require a particular reporting format or software compatibility.

While those differences need to be accounted for, the underlying data itself does not need to be scattered across multiple systems. It can be unified in a single software platform that feeds into the necessary reporting entities in order to reduce delays in processing and preserve data securely.

 

Why Key People Are Data Risks

Asset management firms worry about key person risk all the time. The data analyst guru, the stock-picking wunderkind, and the client rain-maker all get attention. Even more important for daily process and management are the integral staff that make data and productivity flow.

Without an integrated data management system, these staff members may resort to their own methods of information-sharing like emails or hand-held devices that vanish when they leave the firm. Even if their data is left behind, it is often lost in a grab-bag storage system of devices and software with no way to understand how it all relates to each other.

Key data staff of all kinds such as compliance, human resources, and IT can unintentionally inhibit productivity and efficiency simply because they are often forced into ad-hoc solutions that only they know. Tie these systems to a single access person and crucial information lies hidden while scalability becomes impossible. Worse still, it can create an entirely redundant system with its own particular flaws.

 

Productivity Goes Up with Automation and Transparent Systems

Spreadsheets need to be manually updated. They do not work in real-time, yet the entire asset management process has become a real-time industry. With the advent of cloud storage, all third-party providers can update their information instantly. Presentations, reporting documentation and data charting have all become more sophisticated, demanding flexibility that spreadsheets cannot provide.

Scalability is the key to growing productivity. What worked for a small client base must now take into account the ability to grow with new clients. The cloud allows for this scalability but only if a firm has the tools to access the information and data stored within it.

Key person dependency will continue to exist but the tools those key people use must be adaptable to their requirements and, most importantly, accessible by anyone who needs it. A permissions scheme has to exist, but the ability for information-sharing is the next step after it, not a gate-keeping tool.

 

Switching to Automation is Worth the Effort

The transition from spreadsheets and other manual systems can be complex and challenging. That does not mean it should not be done. A little short-term difficulty will be well worth the effort by producing new system processes that will be much more flexible and changeable.

By creating a uniform data and information source as an underlying management tool, the expression and manipulation of that data can take a multitude of forms without walling off the original data from other users.

Workflow automation is rapidly becoming the hallmark of forward-thinking financial firms, worldwide. These are the companies who understand that efficiency, transparency and client satisfaction will give them the edge over their less enlightened competition.

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