Achieving operational efficiency - key takeaways from InvestOps 2024

Operational efficiencies are the top strategic priority for firms in 2024

This year’s InvestOps USA event presented a prime opportunity for the industry to engage in extensive discussion, collaboration, and knowledge sharing. Over three days, experts tackled the pressing challenges confronting buyside firms. Across panel discussions, keynote addresses, and fireside chats, key themes surfaced, offering insights into the common trends of the industry in 2024.


Operational efficiencies reign supreme

As anticipated and echoed in the WBR Insights Report, shared before the event, operational efficiency is the top strategic priority for firms in 2024. Whether focusing on the front, middle, or back office, or contemplating operational challenges, technological advancements, or AI integration, the industry's focus remains on enhancing cost-effectiveness, streamlining processes, and maximizing operational efficiency.

Operational efficiencies are the top strategic priority for firms in 2024John Joseph from Xceptor led a thought-provoking panel on "Leveraging Operational Scale," where participants discussed the importance of collaborating across business functions to identify and implement efficiencies aligned with broader organizational objectives. As firms further define their target operating model they are looking to scale; whether outsourcing middle and back-office operations and/or through the application of data and automation. Panel participants shared that many of their firms are looking to pinpoint cost drivers and prioritizing efforts to streamline through the strategic utilization of technology and process enhancements.

Improving operational efficiencies goes beyond processes and systems; it also considers employee optimization. While many firms view employee costs as fixed, it was noted that inefficiencies often lurk within existing tasks and tools. Understanding how employees allocate their time enables firms to look at opportunities for streamlining specific tasks to improve workforce productivity. When looking at high volume, highly repetitive processes with lower value output, firms are outsourcing. This allows employees to focus on those high-value, bespoke processes, and tasks where that human element is needed.

The inevitable rise of automation

Automation was also a prevalent topic among attendees, with many actively exploring its potential and allocating budgets accordingly. Still, firms are grappling with the most effective deployment strategies. During a session led by Xceptor titled "Automation and Process Consolidation," participants discussed concerns on the extent to which automation should be pursued before experiencing diminishing returns. We know that automation is the future, but is it possible to talk operations without AI?They identified low code/no code solutions and last-mile approaches as having the highest potential for return on investment. Additionally, discussions emphasized the importance of hiring or upskilling talent to deploy these automation tools throughout a global organization efficiently.

While acknowledging automation's transformative potential, firms are navigating the complexities of implementation, including regulatory considerations. Kelly Branco, CFO/CCO at Tremblant Capital, emphasized the importance of rigorous due diligence on service providers and counterparties, taking into account SEC guidance. Others stressed the necessity of piloting automation initiatives in controlled environments, with thorough expert evaluations to assess real-world benefits.

AI: Integral to modern operations

Reflecting on this year's conference, it's evident that discussions around operational processes, technology adoption, and automation invariably intersect with AI. However, panelists made the important distinction that AI is not Automation and Automation is not AI. Industry stakeholders, while cautiously optimistic, are adopting a deliberate and conservative approach to AI integration. Selecting core AI use cases and conducting comprehensive evaluations are deemed essential steps in this journey.

Data quality remains paramount

The importance of data quality, data management and data integrity remains pivotalWhile firms are focused on operational efficiencies and technological advancements, the significance of data quality, management, and integrity is more important than ever. From ingesting and normalizing unstructured data to validating its integrity, diligent data management not only enhances efficiency but also mitigates risks and enables resource reallocation towards value-added tasks.

InvestOps 2024 served as a testament to the industry's unwavering commitment to operational excellence, technological innovation, and data-driven decision-making as firms navigate the evolving landscape.