The role of AI and natural language programs for fund operators

Three industry experts look at what artificial intelligence (AI) is offering and what operational professionals should be aware of.

Fund Operator Editor POSTED ON 11/23/2023 8:00:00 AM

(L-R) Nerlekar, Newman, and Melkonian.

The rapid rise of artificial intelligence (AI) and natural language processing programs over the course of the past 12-18 months has caught many off-guard.

It has even shocked the industry itself, which is struggling to cope with this pressured world. Recently, Dr Martin Goodson, CEO and Chief Scientist at Evolution AI, told Fund Operator that “the truth is that nobody can predict the impact of AI on any kind of work”.

With this claim in mind, questions about AI and how it could help or hinder fund operations teams were posed to panellists, including Russell Newman, former Managing Director, Great Lakes Advisors, Aani Nerlekar, Senior Director, Solutions Management & Solutions Consulting, SS&C Advent, and Arthur Melkonian, Chief Operating Officer at Equinox Partners, during a recent Clear Path Analysis webinar in conjunction with SS&C.

The discussion covered the topic of “What are the major barriers to business expansion, why do they persist, and what tactics are available? Exploring experiences in operations, finance, and technology”. The transcript has been published as a report and features insights from the panel. 

Andrew Putwain: What role do automation and natural language programs play in asset management? What are they offering, and what should people be aware of?

Arthur Melkonian: We’re looking closely at things like ChatGPT and neural networks that you can deploy internally. Early on, I embraced these items at a high level because they’re easy to use and great for repetitive and mundane questions that arise frequently. With enhancements, these technologies could answer more complex questions – ones that are referenceable. You wouldn’t need the general council to advise; you’d have the encyclopaedia within the chat function. If these things become more intelligent – which they will – they will begin to do the analysis for you, effectively being a co-pilot in all decisions.

"It comes back to budget and cost, especially for smaller businesses."

Russell Newman: It’s still early on, but there are many innovative technologies that could help the asset management space both now and in the future. However, it comes back to budget and cost, especially for smaller businesses that can’t afford to implement that technology. The first thing to prioritise should be automation. This means you can streamline your business, have an automated intervention, reduce risk, and enable systems to run themselves. You want to use open source and other methods to get you to the same place that you would be with paying for high-end technology.

Aani Nerlekar: I agree that it’s too early to see the full value of these items. Some of these AI technologies will provide a lot of data at your fingertips and enhance decision-making. Hopefully, it is smarter data and knows what you are asking and looking for and can provide information accordingly. We have already seen the value of intelligent automation with robotic process automation (RPA) and natural language processing (NLP) across a number of our service businesses – in areas like accounting, reconciliation, portfolio management, trading, customer communications, and more.

Andrew: How do you develop human talent and what is the biggest focus there?

Aani: Having a panel discussion with four AI bots wouldn’t be very interesting. You’ll always need the human element and touch – whether you’re talking to investors, vendors, or looking at strategies.

"You can get data from AI, but there’s a lot of value in human decision-making."

You can get data from AI, but there’s a lot of value in human decision-making – which I don’t see changing or going away. At SS&C, we have Blue Prism, so we use digital workers via AI technology to do some of the menial and repetitive tasks. Digital workers free up our staff to focus on higher-value tasks.

However, the human element remains – and will always remain – crucial for us.

Russell: I don’t feel that technology eliminates human roles, but rather shifts them to new areas. This could be analysing data or overseeing certain responsibilities, which allows people to grow and learn other aspects of the business.

You can see more of the panel’s thoughts and read the report in full, by clicking here.


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