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LATEST THINKING

A New Paradigm
for Investment
Performance
Measurement

OVERVIEW

Performance measurement within investment operations is ripe for innovation. The digital revolution has intensified existing data management and information delivery challenges, creating growing expectations for higher quality information delivered near real-time, neatly packaged for instant digestion. Yet some investment managers are struggling to satisfy these new demands due to fragmented operating models for performance measurement.

At the same time, internal and external stakeholders are turning up the pressure for higher quality performance data. They expect information that is more flexible and timely. The fact that the methodologies behind these calculations differ across numerous stakeholders multiplies already complex needs.

To meet these demands, firms should re-architect the enterprise-wide performance measurement process with an eye to refine data management, redesign operating models and enhance technology applications. Those that do could be well positioned to meet stakeholders’ expectations for performance measurement data.

 

“THE DIGITAL AGE HAS RADICALLY ALTERED INFORMATION DELIVERY DEMANDS. INTUITIVE, INTERACTIVE INTERFACES ARE NOW BECOMING THE NORM.”

GIRARD HEALY
MANAGING DIRECTOR

TAKE ACTION

There are three foundational areas that investment firms could address to improve performance measurement:

1

Refine data management. Creating a central repository for performance data can improve information capture. Data quality is also a major issue at many institutions. To improve it, the performance measurement team must understand stakeholder requirements. They should also actively participate in the enterprise-wide data governance process to help ensure they receive the highest quality information possible.

2

Redesign operating models. The operating model, as it relates to performance measurement, must help enable production, delivery and client service. Both decentralized and centralized models can achieve these functions. Regardless of the model, utilizing standard processes and controls is mission critical. The quality of execution depends on having the right staff with the appropriate skills for the allocated tasks.

3

Enhance technology applications. While technology applications can streamline and automate performance measurement processes, any investments here should be guided by business requirements first, and technical functionality next.



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