Fund Operator: What is the impact of automation on the skills required from operations people and how are you hiring for that?

Terry Yodaiken: If you look at the industry, there is a spectrum as to where people are in the automation journey.

Depending on where you are as an organisation, you require different things from staff in operations to help you move along in this journey and the strategic objective of the organisation.

When I was in operations and we were starting to look at automation, I asked some of our operational staff, team leaders and managers to take a step back with me in order to look at the bigger picture.

Through that exercise I gained a sense of how much of the operational infrastructure that has been built over many years needs to be peeled back in order to help simplify and get the basics right around workflow processing and using automation.

"I asked some of our operational staff, team leaders and managers to take a step back with me in order to look at the bigger picture."

I had to ensure that people understood the strategic reason for doing this and the way that they could contribute to the delivery of the operational strategy.

At the same time, I tried to reassure people that we weren’t trying to replace their jobs but rather that there are new requirements and we have to be able to oversee these processes.

To the extent that we have outsourced, our outsource service providers are supervising degrees of automation. And robotics gives a whole new perspective on how you oversee a service provider.

Any organisation that is starting to automate or is automating should be thinking about the different types of skills needed in relation to where they are in that spectrum.

Fund Operator: How can you ensure that you can retain the talent in your teams as new technology is being introduced? Also, as you are bringing new members into the team, how do you get them to understand and embrace the technology that is being used?

Terry: I was quite amazed when we started to have these conversations around automation, at just how ‘on-board’ and excited people were to start to think about the use of technology and the operational strategies that are key to their everyday roles.

It certainly isn’t for everyone but there are several people in operations who have been pigeon-holed, who never viewed operations as an area where you could contribute to the alpha of the business.

I found that there was a tremendous desire from people to get involved and I had very few people who felt threatened by it.

A lot of this is around appropriate positioning and not just walking in one day and announcing that you are going to be embarking on some significant automation change.

"There was a tremendous desire from people to get involved and I had very few people who felt threatened by it."

In terms of bringing new people on it is even easier because you typically have millennials coming through who all embrace technology.

In some respects, whilst we have done this, other asset managers have started to think about their operating models in terms of a smart sourcing approach where they have sought to insource or smart source some functions with more technology.

These functions would supplement some of the traditionally outsourced type functions and
for this it is all about attracting the right type of people.

Fund Operator: As technology and data frees up time, what role does operations play in driving the business forward in growth at a strategic level as opposed to tactical?

Terry: Having operations people in a new position where they can go and face off against front office distribution people and do their translation work is a huge value-add.

The time you save through automation, workflow and robotics should allow for this and genuinely does get people excited.

Ten years ago, operations people wouldn’t have thought that they would be advising a fund board on operational strategy.

"Now operations are viewed as a key pillar in terms of driving the strategic direction of the firm forward and supporting revenue growth"

There is a general theme that now operations are viewed as a key pillar in terms of driving the strategic direction of the firm forward and supporting revenue growth and maintaining operating margins.

Far more people than just the COO or head of operations really understand this and where they fit within this puzzle.

Everyone has had a dynamic mind shift from just checking things off a check list to actually working through a process.

With there now being much more automation, they can focus on the value-add stuff and this goes to the retention point. So, all of this becomes a holistic ecosystem.

In terms of data, I don’t like the organisation of data, but I do like having it available and of course you do have to go through the pain of organising it in order to have it available.

As we become much more data-centric and have the tools and the data to analyse and to take the insights from this, we are able to translate it into something quite practical that the business can use to support its activities.

When I started my career, I was in product development. As part of this process I would go to the distribution team and ask how much they were going to raise, which was always such a painful conversation, because they would just pull a number out of thin air.

"As we become much more data-centric, we are able to translate it into something quite practical that the business can use to support its activities."

Whereas nowadays, when you ask this question the distribution guys will pull out a lot of data and information and will come up with an informed number.

This is important, as the operational component of distribution, which is to provide the data and make it accessible to distribution, really informs how the business is deploying their resources.

And then you can ask whether they are deploying them effectively into something that is going help you achieve your strategic objectives or not.

 

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