Vision Super has insourced investment operations over the past 10 months to improve operational efficiencies and leverage direct insights from the investment data captured.
In March 2015 the $7.6 billion fund created a “head of investment operations”, followed by an “investment operations analyst” role in September 2015.
Vision Super says this has transformed its day-to-day internal investment processes, generating improved reporting and allowing senior investment staff more time to focus on value-add activities.
The fund has also taken advantage of a new performance reporting platform introduced by its custodian. According to Emma Robertson, head of investment operations at Vision Super, this means “We can now access our own data and no longer need to simply send the custodian’s reports to the investment committee and board. We now download, analyse and present information in the way we want to”.
Robertson added that the ability to access and analyse its own data has added tremendous value, enabling the fund to have greater insight into its assets and liabilities. For instance, it now has a better understanding of cash flows, which in turn impacts on how the portfolio is handled, leading to improved decision-making capabilities.
Stephen Huppert, partner at Deloitte, said this move towards a hybrid model, where a provider offers a platform as a service, was being seen across the industry.
“Even if a fund decides to insource a function … does it want to actually invest in software and therefore invest in hardware and infrastructure and maintenance and continual upgrading?” Huppert said.
“It might be a fund has a function in-house but it doesn’t actually own the hardware. That’s why it’s important to look at the various layers of the operation model.”
He added that even before the question of insourcing or outsourcing was asked, a fund needed to stand back and decide what was the reason for an operating model and its strategic intent.
“It’s important to link the key elements of the operating model to your business strategy. Once you’ve done that then you need to look at the different components of what you need to do.”
Emma Robertson and Stephen Huppert will be speaking at the Investment Operations Conference at the Sheraton on the Park, Sydney, on February 24, 2016. To register click here.