By Ken Akoundi
“In the middle of the journey of our life I found myself within a dark woods where the straight way was lost.” ― Dante Alighieri, Inferno
If an institutional investment professional were to be guided through Hell (a la Dante’s Inferno), he would pass by five circles of torment … all of which would contain colleagues frantically checking calendars and clocks, desperate to get through to-do lists that grow faster than items can be checked off. Time is indeed a valuable commodity, and the lack of it can be hell on earth.
While the only way out of the Inferno was through the center of earth, the way out for investment professionals is much easier, thankfully. While it is impossible to add hours to the day, it is possible to reclaim some of those hours and put them to better use. Let’s follow our guide – not Dante’s Virgil, but our own modern-day Technos – through the five circles of hell for institutional investment professionals.
The Fifth Circle: Reporting Woes
We start at the outermost circle – Reporting Woes. The demand for transparency is increasing from all quarters, with the result that generating reports and responding to requests for information is a way of life. Unfortunately, the processes, software, and systems that are in place in most institutional investment firms were not designed with this level of demand in mind. To ease the burden on investment staff who are swamped with requests that require significant manual effort to fulfill, firms must invest in modern technology that can keep data in order, roll data up, generate reports, facilitate analysis, and satisfy compliance.
The Fourth Circle: Board Package Perdition
Old decision-making processes have created a necessary evil: the quarterly Board package. In the two to three weeks leading up to a board meeting, investment offices are focused solely on preparing a board package, with all its questions and nuances. This task involves updating charts and data (both quantitative and qualitative), endless emails, and round-the-clock communication via text, calls, and chats around the water cooler. Many of these tasks can be streamlined, simplified, and digitized with the proper software, putting weeks of time back into people’s schedules.
The Third Circle: Excel Agonies
Historically, each team in an investment firm – the equity team, private equity team, fixed income team, etc. – has been authorized to buy its own technology. Consequently, when it comes time for cross-departmental reports to be generated, each of the different teams submits their data via Excel spreadsheets or CSV files. Those files then have to be cleaned up and the information funneled into a single PowerPoint deck for the consumption of the C-suite. These Excel agonies can be eliminated by integrating all technology needs under one umbrella.
The Second Circle: Data Mayhem
Collecting qualitative knowledge within investment offices is often messy. Unlike the quantitative information that usually comes from a custodian or fund administrators, qualitative knowledge may come in emails, be downloaded from secure and non-secure websites, or reside on personal or shared drives. Information coming in the form of a PDF or other type of unstructured data is frustrating to analyze, store, and locate. The firms that use Excel templates or other open-protocol formats for their due diligence questionnaires (DDQs) still haven’t gone far enough. What they can do is completely digitize the exercise, so they can access the structured data via REST API technologies. The resulting data is conveniently stored, located, and queried in the database.
The First Circle: Email Abyss
The center-most and deepest circle of Hell is the Email Abyss. The number of emails received by investment professionals is staggering – topping 25,000-50,000 per annum. With 100-200 emails coming in every business day, professionals struggle to prioritize. Distractions are constant, interrupting concentration and further limiting productivity. Technology can filter this barrage of emails, however, siphoning messages into different categories and priority levels to boost focus and increase efficiency.
If you have found yourself tormented in one or more of these circles of investment professional Hell, it’s time to follow Technos out of the pit. You can make every minute count with the right technology at your side!