In Search of Analyst Productivity

By Ted Wright | 4 December 2015

Three (and a half) ways that funds are making more time for research.

Knowledge workers spend a disproportionate part of their day searching for information, rather than using and creating it. In an industry where the main capital is knowledge, that can be a pretty costly oversight.

According to a recent IDC study, 36% of a typical knowledge worker’s day is spent looking for and consolidating information spread across a variety of systems. Few places is this more pronounced than in the investment management industry, where research analysts spend hours searching-out fund data, trawling through notes across disparate systems and organising ideas. That is by no means a good use of your most expensive asset.

When it comes to pre-trade activities, outdated Research Management Systems (RMS), siloed data repositories and complex processes deprive research analysts of the tools they need to do what they're paid to do, to the best of their ability, which is generate investment ideas that make the fund money.

It should come as no surprise then that analysts are proactively seeking out connected and easy-to-use software that will give them the freedom they need to get stuff done.

This is why the day-to-day consumer software they rely on in their personal lives, such as Dropbox and Evernote, has crept into the workplace. It is why analysts refuse to use proprietary RMS, or are frustrated and often vocal when they are forced to. It's one of the reasons why compliance officers have such a hard time keeping a handle on fragmented data management processes for recordkeeping. Alongside this, it is why finding new ways to integrate people, process and technology to harness the institutional value of research now tops the list of priorities for many hedge fund chief technology officers (CTOs).

Research analysts could be your ultimate technology consumer, but to make sure they’re using the secure and compliant technology you provide them with and not what they have taken out of their personal App Stores, funds need to provide a user experience that fits with their professional workflow and meets their productivity needs.

Here are three (and a half) of the most common factors we've found make a big difference to boosting research analyst productivity:

1. Breakdown silos: Removing data silos and enabling collaboration is the first step to accelerating investment research tasks. Whether you’re using a locally installed content management suite, custom-built RMS or more informal “hacks” (combining spreadsheets and consumer-oriented tools), it’s nearly impossible to avoid data fragmentation, disorganisation and inconsistencies. One of the biggest productivity breakthroughs stems from when the mindset shifts from using a set of systems to upload, track and access individual research information, to creating a unified research environment that analysts can work within, and collaborate from.

2. Automate tedious tasks: It’s often the small tasks that can be the most time consuming. By automating, or semi-automating, the admin-based tasks that frustrate and distract investment professionals day-to-day, you create more time to focus on what counts: research. A solution that takes care of versioning automatically, for example, takes away one of the most tedious tasks for analysts, and when you build in easy roll-back and accessibility to that, you also eliminate the worry around accidental data loss associated with it.

Other automated techniques, such as providing templates to create reusable note structures (like an outline for an earnings call) and short codes for simple note and report formatting, means analysts can get their thoughts down quicker and with less hassle. And it’s just as important to quickly find research, which is where our clients tell us auto-tagging and auto-indexing via companies, countries, authors and other properties helps them spend less time organizing and searching and more time thinking and doing.

3. Make data accessible, everywhere: If your analysts are mobile, so must their research. There's no point in having a data repository of any kind if analysts cannot easily access or create the information they need, when they need it, on whichever device they're using. Whether note-taking in a meeting, reviewing thesis information on the plane or collaborating on an idea on the way to the office, enabling analysts to capture information at source, and share information and ideas when it matters, really matters. And it's making it easy for them to do, so that really counts.

To push productivity wherever your analysts need it, you need more than an iPad and a VPN or a selection of consumer tools. This is where integrated note-taking, combined with a database and CRM, that’s consistent and synced across all devices, really comes into its own – providing the single, integrated experience that gives analysts the ability to get stuff down and focus on the task at hand, wherever and whenever.

3 ½Simplify compliance: While it may not directly deal with your analysts' workflow (hence the half), we all know you cannot begin to build a research productivity environment until you're confident in the compliance posture of the technology. At the same time, avoiding research management tools that restrict user experience for compliance is key. Your analysts do care about maintaining the fund's compliance and security integrity, but are reluctant to let that come at the expense of their own time, productivity and performance.

A unified research environment with logging and archiving automatically taken care of, takes away the pain and chore of compliance for analysts; they don't have to worry about where and how they're saving information, if it's been recorded or about creating backups for every change. For analyst productivity, this “out of the box” compliance approach means they can be confident they're going about their research in a way that doesn't put the fund at risk, without having to change the way they deal with data or adding time-consuming processes along the way. It also means compliance and IT are not tracking their every move and breathing down their necks, which is a big relief for everyone involved.

In a knowledge-critical, research-intensive environment where labour costs run at their highest, it's hard to believe that poor user experience and subpar productivity should ever be an option.

Research analysts just want to get on with their job and generate returns for the fund – and if there is one overriding objective for hedge fund IT at the front-end, it is to let them. When competition for attracting capital is fiercer than ever, it will be the technology that enables your analysts to perform at their best that wins out.

By Ted Wright, Customer Success and Business Development at Bipsync.

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