Blending tech into business models

On the 10/08/19 at 12:39PM


Tuba Raqshan

At the AMTech Day 2019 in Paris, top asset managers shared their strategies on how they incorporated innovation into their business models.

Pascale Auclair, secretary general of La Française group, said that innovation should not just be limited to the products and services but also deal with leadership at the top management. “We need to ensure the full spread of this innovation and also develop disruptive innovation into traditional business models,” she added.

Speaking about the challenges to technology related to blockchain or distributed ledger, Jean-Pierre Grimaud, CEO, OFI AM, raised the point of distribution problems faced by asset managers. “When you are a French asset manager and if your clients want to buy a share of your fund, there is a process in France. If they want to buy your fund in Germany or Luxembourg, they have to go through totally different processes for each country. This results in cost inefficiency and poses difficulty in scaling up distribution. We put a lot of effort and understanding to opt for blockchain platform, which requires good health and efficient distribution,” he said, adding that banks are the hardest to convince regarding disruptive technology because of the revenue models, drastically different from traditional operations.

Arnaud Claudon, head of asset managers, BNP Paribas Securities Services, said that more work needs to be done in the areas of infrastructure, cybersecurity and business models – which will require collaborations in the future.

Grimaud pointed out that the cash part is important while discussing technology. “The main issue is access to cash and ways to exchange it in the funds. We tried solving problems using stable coins within the blockchain model, to have a full working platform,” he said. Auclair said that their firm has launched a fully digital distribution platform for their real estate offering.

Hermin Hologan, partner, WAM leader France EY, said that the challenge for asset managers is to unlock the power of data. “One of the basic questions is if the firms can build on their own capacity of partnering with a fintech. This is causing a reluctance to move rapidly to innovative solutions,” he said, adding that asset managers will be stuck if they rely on legacy IT systems.

Patricia Regnault-Fouqueray, managing director at BlackRock Solutions, said that standardisation and flexibility can go a long way in integrating innovation into existing processes.

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