Miller maintains this view is part of some new thinking crystallizing among asset managers and other financial executives. âItâs unrealistic to believe that institutions and asset management firms can do everything well,â he says. âThey operate in a business environment marked by IT resource constraints and escalating demandsâlike regulatory and compliance requirementsâplus an unyielding need to differentiate their products and services from those of the competition.â
Success in this setting requires finding a means of achieving superior, cost-effective business process execution on all fronts, and Miller feels it is easy to make a business case for partnering with appropriate outsourcing suppliers. âOutsourcing is gathering momentum across a wide range of asset management businesses,â he says. âClients can easily rationalize costs, address time-to-market considerations, offload work from their IT groups, and gain access to focused expertise on processes ranging from CRM, portfolio management, analysis, accounting, risk processing, business intelligence, and other important functions.â Miller cites as examples of outsourced services a number of companies, including RiskMetricsâ¢, Algorithmicsâ¢, InvestEdgeâ¢, Backstopâ¢, SS&Câ¢, and MicroStrategyâ¢, among many others.
Outsource vendors, Miller maintains, can be considered trusted strategic partners if they offer the domain expertise that helps clients grow their businesses over the long haul. âSetting aside technology differences for a moment, the successful vendors in 2006 will demonstrate a deep understanding of their clientsâ long-term business issues, strategies, and goals. Theyâll have a track record of rapidly implementing solutions that are not only customized to their clientsâ specific business needs, but can accommodate future throughput and functionality requirements.â Miller adds: âThe best partnerships represent investments in the ability to innovate.â
For 2006, Miller feels asset management businesses should focus on fast-turnaround projects with immediate benefits, like streamlining access to internal data assets and improving agility and product differentiation via mass customization capabilities. âIf you link efficient access to your data assets with the ability to quickly customize the appearance, user experience, and functionality of your information-based products and services, Iâd say youâve just established competitive advantage.â