Well, it’s better late than never.
According to a new report by Osney Media and BackBay Communications, asset managers are finally ready to update their operations by making technology a priority in 2017. More than half of the asset managers surveyed indicated that they plan to replace outdated or legacy tech over the next 12 months.
One in three plan to introduce an online client portal for the first time, and 14 percent are planning to launch a mobile app. Data governance initiatives and outsourcing tech operations were also high on the list of priorities.
The shift in priorities isn’t as much to satisfy customers as it is to comply with new regulations. Two-thirds of asset managers named regulatory change as the key driver behind new tech adoption, and just 27 percent said it was to meet changing client demands. About half named pressure on margins and costs, while 39 percent cited the rise of passive investing.
“The asset management industry faces a number of challenges: growth in passive investment is putting traditional fee structures and margins under pressure, expectations and behavior of clients are evolving and of course the regulatory environment continues to change,” said Jonathan Wiser, the director at Osney Media.
Still, asset managers are proceeding cautiously, with a quarter skeptical that the industry will look much different in five years (though 13 percent expect the industry to look radically different). Sixty-one percent believe that their firm will remain competitive, and 76 percent are optimistic that they will meet the challenges they face.
They survey was completed by 74 respondents across all areas of operations. The asset management firms ranged in size from boutiques to global firms with AUM over $500 billion.