Efficiency, or rather “Untrue Efficiency” – we’ve been talking about it a lot. We wrote a paper that introduced it in January (you can read that here) and have been exploring its themes in more detail since. But then, Covid-19 arrived on our shores and for a fleeting moment, threatened to alter our path.
As you’d imagine, our minds immediately turned to those who were already suffering or might do so as it spread. We then worried about the global economy and what lied ahead for us all as we began to evaluate our own operations and considered the impact it might have had on our ability to deliver.
We concluded that impact to us would be, at worst, minimal. We’ve always been a lean and efficient organisation and “working from home” was already seen as business as usual. Yes, there was a risk of illness amongst our workforce, but the likelihood of its severity meaning an unmanageable number of us were unavailable was pretty low so we operated with a great deal of confidence and we’re happy to report, we have not suffered any service interruption.
However, as we have seen, a pandemic of this nature is so total in its affect that our own delivery was actually only a small part of our concerns. Our ability to deliver would have meant very little if our supply chain failed. Can we continue to deliver if we lose internet access? Can we meet our obligations if our software stops working or is unavailable to our clients? Could that happen? How rigorous are our partners in respect of the management and control of their own supply chains?
These questions and others lead us to consider our role in our clients’ supply chains and given the nature of this pandemic, its likely aftermath, and possible reoccurrence in the future, the undoubtable importance of it.
Supply chains are in focus. Weaknesses have been exposed. Contracts and SLAs fail to guarantee delivery and penalty and recompense do not contribute towards a required service or product being provided when it’s most required.
In this instance, many firms have found that existing continuity plans couldn’t be invoked. Instead, they were replaced with a switch to a remote operational workforce which is sub-optimal for operational efficiency, the client experience and likely (as we’ve discussed with some industry consultants) detrimental to operational control.
Ultimately, that means continuity ceases to be about replication of an operational environment and instead is about your operational environment being designed in such a way so as not to be affected in the first place, i.e. it continues to operate as expected, regardless of restrictions placed upon you by law or the availability and location of your workforce.
Consequently, we foresee new demands being placed on firms through Regulation, Audit, and increasingly, by their clients, to guarantee uninterrupted service regardless of wider operating conditions and the onus will then be on service providers to prove that they are unaffected by any such future events. Doing so would strengthen supply chains, improve operating models, and instill confidence in buyers and participants.
Today, the International Standards Organisation (ISO) list several standards and certifications that could be applied to demonstrate to some degree that your organisation is able to cope in such circumstances (available here). However, we anticipate new pandemic related certifications that attest confidence in operations should the same or similar happen again.
If that’s the case, then there’ll be a surge in demand for new partnerships and technology to redesign business models. Those who move early will have a competitive edge, those who don’t move it all will suffer greatly in the long-term.
We’ve always known that our service improves our clients’ efficiency. We replace time and resource heavy processes with a fully automated cloud-based service at a fraction of the cost. What we now also know is, the business model we recommend has another benefit. It ensures continuity in the most difficult of times. None of our clients had to worry about available workforce, deadlines, client expectations etc. and we are more certain than ever that we are advocating the right path and choice for the investment management industry.
An agile business model, supported by appropriate technology, and well-chosen partners continues to be the desired state for progressive organisations. It certainly increases efficiency, but there’s now perhaps a greater benefit – it might be the only way you can guarantee the uninterrupted service that your clients are demanding.
Given the choice, and all else being equal, would you choose a service provider whose supply chain is “pandemic proof” over one that wasn’t? Will the degree of your own readiness be something you’ll actively promote in the future?