Front Office Survey Shows Reliance on Manual Processing

Survey of front office decision makers indicates correlation between high spending on manual processing and decreased investment performance.

SimCorp, a prominent provider of investment management solutions for the global financial services industry, found that a survey of asset management front office participants demonstrated that manual processing has a detrimental effect on financial returns. Nearly half of the 48 respondents spent more than 15% of resources on manual processes in the front office. Average performance ratings were lower for all participants in this category.

Furthermore, almost one in five (18%) of those surveyed indicated that their ability to generate and view intraday positions was insufficient. Almost a quarter of respondents also admitted to feeling uncertain about their system’s ability to support new market entry (24%) and new asset classes (21%).

The survey also demonstrated that the front office still requires further change in order to accommodate regulatory burdens, which have materialised as a result of the financial crisis. Over one-third (37%) of respondents said they were not entirely confident in their ability to comply with regulations.

“In many cases, manual workarounds have been developed as a patchwork solution to ageing legacy infrastructure at investment management firms,” explains Klaus Holse, CEO at SimCorp. “These will struggle to provide the front office with a full and timely overview of their risk without moving to an integrated solution, which allows them to compete effectively.”