In the race to innovate in the wealth management space, firms are increasingly prioritizing enhanced operations as an investment with broader strategic implications. A CapGemini report on digitizing the back office revealed that 70% of bank executives were not confident that their operational processes could adapt quickly to external changes. The study goes on to further highlight that increasing efficiencies and providing better products and services must start at the back of the house, as respondents indicated that 60% of their customer dissatisfaction originates in the back office.

The benefits of a strong middle and back office are well known – it’s all about creating and increasing efficiencies and empowering the front office to better serve the end investor. So what are wealth managers actually doing to revamp their operations functions? We sat down with Cheryl Noriye, our VP of Customer Operations and Support for an inside look at the state of operations in wealth management.

How do firms currently manage operational tasks, like reconciliation?

Although the industry overall is getting more comfortable with automating operations, the reality is that many firms still find themselves rooted in manual processes (as in actual spreadsheets) for operational functions like reconciliation. Manually updating spreadsheets is not only a slow and inefficient process, but opens the floodgate for human error. While some can get by operating this way, it brings with it unnecessary risks and inefficiencies that can be addressed through technology. I have always strongly believed that no modern organization should hire people to do what technology can do — especially when the technology ensures tasks are completed more accurately and timely.

What kinds of firms will benefit from automating the majority of their middle office functions?

Every firm can benefit from improving the efficiency and reducing the risk, error, and costs of their daily operations. As the volume of investors and accounts continue to grow and the need to mitigate regulatory risks and costs becomes increasingly critical, firms are realizing that automation is no longer just a “nice to have,” but a business imperative.

Take MyVest for example: using our technology, we can service billions in assets and reconcile tens of thousands of accounts before the market opens, with just a fraction of the people of a traditional in-house operations team. You simply don’t need people to run reconciliation manually. I think most firms would agree that there are much better uses of an employee’s time than comparing spreadsheets all day.

For firms that do adopt a tech-driven middle office, what kind of outcomes can they expect?

This enhanced efficiency and accuracy opens up employees’ time and energy to focus on more value-add activities — whether it’s working on a customized project to fit a client’s specific needs, or working with new data sets and drawing out valuable insights that will help the advisors and portfolio managers to improve investment decisions.

Tasks like initial account set up & funding are ripe to be improved through a digital middle office. For example: we can get client accounts open and invested within one day of the funds becoming available — as compared to the three to five days that’s more common in our industry. Improving these processes helps firms move towards a more client-centric approach, a key to remaining competitive in today’s market.

What’s different about MyVest’s Middle Office Operations Suite that gives wealth managers an edge?

Our differentiation comes from a tech-driven approach, bringing automation and scale to common functions like reconciliation, performance, billing, and reporting:

  • Automation: Our Middle Office Operations Suite brings speed and accuracy to tasks like account opening, reconciliation, and billing, allowing the rest of the organization’s downstream processes to run more smoothly.
  • Integration with SPS and real-time data access: For those already using our Strategic Portfolio System™ (SPS), our Middle Office Operations Suite can be seamlessly integrated across an organization so that everyone is working off the same reconciled data in real-time, enabling more accurate reporting and trading.
  • The people and service: Our team of dedicated professionals accomplish the work of most firms’ entire middle office with a quarter of the people, leading to greater efficiency and cost savings.

Take Action

MyVest has long recognized the value of a strong middle office and has taken measures to ensure our offerings provide our clients with best-in-class operations capabilities. We recently enhanced our Middle Office Operations Suite, which integrates into our enterprise wealth management platform, The Strategic Portfolio System™ (SPS). Read more about MyVest’s Middle Office Operations Suite.