Members share detailed operational and technological data to learn from peer experiences and use this invaluable information to drive improvements in their own organizations. The CutterMetrics service will meet the unique needs of mid-sized asset management firms and provide them with the tremendous value that the global firms enjoy.
âWe will work with firms on a holistic basis to define the metrics needed to evaluate operational effectiveness and to assess technology and operations costsâ, offers Bob Klehm, Managing Director. âFirms compare their performance against others in their peer group, and armed with this information, they can accurately prioritize their technology investments and process improvements. Over time, they are able to chart improvements in performance and continually gauge the companyâs operations against âbest-in-classâ achievers.â
All investment management firms collect at least some operating data to assess their ongoing performance, and they use this information to re-align initiatives or defend budget requests. While this process works, it suffers from âmeasurement myopiaâ. Without any external comparison it is very difficult to differentiate which initiatives require the most attention, pose the greatest risk and promise the greatest return. If a firm observes that some of its peers excel at trading, it might want to raise the bar on its own trading capabilities. If an organization is having difficulty implementing algorithmic trading and finds that all of the companies in their peer group are facing the same challenges, it could modify expectations for this effort without incurring the wrath of traders and other business users.
âBased on more than ten years of research and consulting in investment management systems and operations, CutterAssociates has identified the key metrics that investment management firms need to effectively assess their operations performance,â stated Mark Bobseine, President. âFor each function, CutterMetrics defines the most appropriate metrics â those categories that are most useful for recognizing achievement and that are actually measurable.â
âWhether you are positioning for rapid growth or controlling costs, you can benefit from understanding where other firms are investing their resources, and whether they are achieving better results than you are. To provide additional insight on market trends and vendor capabilities, CutterAssociates will also, as an option, provide an analyst who is expert in each field, to conduct a personalized review of your results and offer specific recommendations for improving your businessâ, says Bob Klehm.
CutterMetrics delivers four quarterly reports â each focusing on a different aspect of the investment management business â based on data submitted by each participant. In addition, CutterMetrics identifies best practices for each functional area and analyzes the data for trends and anomalies. Assessments and the detailed reports are be available only to CutterMetrics members. The four topics are:
â¢ Front Office (Trading, Compliance, Risk, Portfolio Analysis)
â¢ Middle Office (Performance Measurement, Data Management, Client Reporting)
â¢ Back Office (Corporate Actions, Regulatory Compliance, Settlement)
â¢ IT Spending Priorities