Products (SMA, UMA, etc.) on platforms? How to solve the visibility problem

Depending on your business you may have multiple products that you are selling directly and through different channels and platforms. Bringing non-Mutual Fund data, such as SMA, UMA, CIT, UCIT, and more, into your ecosystem may present a visibility problem. Let’s look at SMAs (Separately Managed Accounts) as an example, illustrate where the problems arise, and share an approach for how to solve them.

Platforms pose problems

If your SMA is managed directly by you (an asset manager), an account will be established on your books and records. You’re responsible for managing the account’s positions, cash in/out, performance calculations, customer statement, invoicing, etc. and you know who you’re doing business with. Now, let’s say you also have your products and strategies listed on various platforms where they can be used by other asset managers as part of their portfolios, or a “sleeve”, used to manage their own SMA accounts, other investment accounts, even their own mutual fund. In this scenario, your business will be represented at the asset manager level responsible for the underlying account(s) instead of the individual or institutional account. How do you know who’s really using your products so that you can best manage, market to, compensate on, and grow that relationship?

Here’s an example to help illustrate the problem: John Smith at RBC manages retail accounts who are invested in your mutual funds ($250M), but he’s also using your products in his model portfolios for SMA accounts ($100M) as well as using your offshore products/UCIT’s for his international accounts ($150M). Each of these will be siloed and reported on separately. How can you know John Smith actually represents $500M in assets and not just $250M if you’re looking at mutual fund assets alone?

Gain visibility

When looking at your platform business, the accounts and their flows and assets are recorded from data feeds directly from the platform or from data files or various reports that you may receive from the SMA managers directly. Data delivery varies by platform and data type, which makes it difficult to aggregate, reconcile, and share. To solve these data management challenges and gain visibility, you need to:

Manage, Transform, Steward

The lift and burden on your internal resources to execute these steps can be significant. Asset managers will often explore a combination of technology and services to help prepare the data and draw insights from it. To aid in the execution of the three steps above, we recommend you:

  • Assess internal resources – Do you have the right people and do they have time to pull data and process? Evaluate whether it makes sense to add a team member with specific expertise or to outsource.
  • Evaluate infrastructure and tools – How is your tech stack functioning today? Do you have the right tools in place to have you transform and steward the data?  A distribution data platform delivers the greatest value to asset managers who have products sold through model portfolios or platforms, as it helps you bring the data in, reconcile it, and present it in your CRM at the advisor or account level.
  • Establish a process – Products, data files, and people all change. Establishing a process that includes flexibility will help ensure you continually get the visibility you need to make intelligent distribution decisions.

Empower distribution

When you have the right people, tools, and process in place, you’ll be able to determine who is doing business with you at the advisor and account levels. Integrating this information into your CRM will empower distribution. Your sales and marketing teams can use this, along with other attributes and insights tracked in your CRM and elsewhere, to segment your clients and communicate the right information at the right time. With a 360° view, you can also look for trends or themes (e.g., Are your strategies gaining better traction in model portfolios and which ones vs. how products are doing across platforms?).

Independent of where you are in the process of gaining visibility, we’d be happy to discuss your approach and how we may be able to help. Contact us or connect with me.