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Seitz Partners’ Monday Q&A This Week’s Focus: Preparing for the Turn - Advice for Asset Managem

Q: What advice do you and others have for asset management leaders in the face of this crisis?

A: I have to admit, this doesn’t feel like 2008. The tenor of most of my conversations with asset management leaders is more optimistic than those I recall having during early stages of the last financial crisis. Whether you believe we are entering a ‘new normal’ or simply rolling with the ups and downs of the market, however pronounced, we’re all faced with the need to adjust to challenges most of us didn’t see coming – at least not in this form.

So, what are we to do? Do we sit on our hands and wait it out? Do we push forward continue with business as usual? Do we worry about doing and saying the wrong things, at the wrong times, to the wrong people and risk creating animosity with tone deaf messaging? Do we follow the herd and offer daily or weekly written/audio/video commentary on broad market themes?

To address these, and other questions, I interviewed several asset management leaders including: a retail distribution president, a head of global distribution, a head of institutional distribution, a head of investment specialists, a head of global consultant relations, a head of institutional sales and a head of DCIO sales. Assets under management, ownership structure, asset class mix, global reach and business strategy varied from firm to firm and from person to person, giving us a range of perspectives.

I’ve included their answers below:

What are you messaging to your teams?

  • Take care of the people that take care of you. If possible, get people on the phone, connect with them, listen to their personal and professional challenges and be a resource/coach/advisor to them.

  • Stay on top of clients’ (and prospects’) portfolios and the impact of the market relative to both risks and opportunities.

  • Take care of yourself. Get your family situated and focus on your own mental and physical well-being. Exercise, shower, dress for success and be productive in spurts – knowing you’re not working a full 8-hour day (or more).

  • We need everyone, in every department, to step up and lead in their words and actions. You don’t have to have management responsibility to be a leader. Do the right thing for you, your colleagues and your clients.

  • We’re not pumping the breaks but taking a different course. Clients need our help more than ever. They need to get this right. Help them be more productive and follow the right path – especially advisors, who risk losing prospects, clients and revenue. Help them focus on opportunities that generate revenue in addition to those that preserve revenue.

  • 2008 and 2009 were my best years as a salesperson, in spite of the financial crisis. I focused on my process and highlighted that our investment strategies will do what we say they will do (and they did). Project certainty and confidence.

  • Communicate at a respectful pace and don’t just add to the noise. Recognize that everyone is getting bombarded with emails related to business continuity, the markets, their portfolios, etc. Spread out your correspondence, make it meaningful and provide valuable content.

  • Clients and prospects, whether they’re institutional investors, investment consultants, manager research analysts at platforms or financial advisors are acclimating to working from home. Many of our distribution professionals already work from home and can leverage their experience and share best practices.

What are you doing, and what should you be doing, to prepare for the new market realities?

  • Review your current pipeline to identify what’s at risk, what’s stuck and what you can and should push forward.

  • Map your investment strategies against market opportunities by channel and geography. Identify where there are needs given current market conditions and where there will be needs when the market returns to some sense of normalcy. Identify investment solutions that meet both needs and spend time with marketing, investments and sales to craft, customize and hone your message.

  • Segment your contact list – focus on top clients and prospects first. Work with your internal salesperson/associate/analyst to identify those that require the most attention and those that can be placed on the backburner.

  • Many firms are currently focused on cross-selling to existing clients, figuring that they are more likely to turn to a trusted relationship versus an unknown quantity.

  • Pay more attention to the activities that led to successful results in the past. Work backwards from when you were awarded a mandate to the beginning of the process and acknowledge what worked and what requires improvement.

  • Identify ways to leverage available bandwidth (there should be more now) to sharpen tools, develop skills, organize your workspace and thoughts, improve your sales process and prepare to move quickly when the gates reopen. For example:

  • Fine tune marketing materials, pitchbooks and presentations. Remove stale/obsolete information and graphics and refresh/update content. Customize for specific channels or market segments.

  • Spend time with PMs, analysts and product specialists to enhance your understanding of their investment philosophy, strategy and portfolios. Develop a thesis regarding where, when and how to best position them in a prospect’s portfolio.

  • Practice your pitches and presentations across sales, investment and marketing staff. Write and refresh your scripts. Leverage internal and external audiences for feedback and ideas.

  • Pursue a CFA, CAIA or other designation; study for your Series 3 or 24, or similar license.

  • Brush up on industry regulations and relevant compliance material.

  • Conduct detailed competitive intelligence. Review competitor messaging and marketing. Track product performance against your own. Pinpoint and categorize their weaknesses and your advantages. Identify where you have consultant/platform/client overlap and identify opportunities to replace their strategies with your own or gain additional market share. Differentiate your messaging.

  • Assess the talent on your team. Compare them with the talent available internally and externally. Is this the best team available or do you need to upgrade in a specific territory, channel or function?

  • One distribution leader noted that 80% of his team is hitting their (revised) activity numbers while the rest are backing off and not engaging with the market. If they’re not engaged, understand why they’re taking their foot off the gas – whether for personal/family reasons, concern for the timing and content of the messaging, fear, laziness or other motives. Help them.

  • Plan for a longer downturn with best- and worst-case scenarios (and everything in between). Ask hard questions like, “What happens if our assets drop 30%?” and “What if our revenues drop 40%?” Do your homework so that if asked, you can pinpoint where you have opportunities to cut costs without significantly impacting performance.

What can you do to build your brand, gain eyeballs and open doors?

  • Leverage technology to communicate and share your message. Collaborate with internal and outside technology partners to effectively (and professionally) connect with clients and prospects, and distribute your content

  • One leader noted they initially had hiccups with their technology in the early days of the market disruption. Phone lines were jammed, access to webinars was limited and multiple technical delays caused some angst internally. They didn’t get it right out of the gate, but they’re now introducing subject matter experts and content that others are not, and thankfully, they’ve tackled their technical issues.

  • In addition to your CEO, chief investment officer, economists and key PMs, offer access to other subject matter experts (offer a menu of experts similar to a speakers’ bureau) including: your head of government affairs (if you have one) and key analysts – perhaps your star healthcare analyst or a geographic-specific (i.e., China) analyst.

  • Have these experts develop content targeted to a specific client type and need; make sure the content is easily digestible.

  • Recognize and react to an opportunity to innovate and explore new ideas. Determine if there is an opportunity to acquire relevant investment businesses/ teams or adopt their strategies.

  • Identify firms and people with whom you can partner and collaborate. Share prospect lists/contacts and make introductions to your relationships; trade best practices and ideas; conduct joint online marketing events and conference calls; share costs; develop a collaborative solution to a client problem; etc. This is especially important for smaller firms and those attempting to break into the U.S. market but lack brand recognition and traction.

  • Review your pricing. Identify options and arrangements that will allow your firm to gather assets and generate revenue to fund both business operations and innovation. Like the bullet above, this is a key issue for smaller firms whose survival may depend on the ability to gain enough assets to keep the doors open long enough to ride this market anomaly out.

  • Identify new channels where your strategies may gain better/additional traction. Explore ways to enter those channels with the biggest bang for your buck.

Key Takeaway

As one head of global distribution put it, “I feel like many firms are missing the message. They need to be aggressively planning for the turn [in the market].” No one knows when that will be, but if you’re not already transitioning from defense to offense, you’d better at least be preparing for it.

If you would like to hear more about what asset management leaders are doing to prepare for the turn, please don’t hesitate to reach out to us.

About Seitz Partners

Seitz Partners is a retained executive search firm dedicated to serving clients in the asset and wealth management industries. We deliver unparalleled access to talent and unrivaled market insight to our clients. For more information, please contact:

Christopher Seitz

Managing Partner

Seitz Partners Monday Q&A

© 2020 Seitz Partners. All Rights Reserved.

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