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In fund services, CFOs are our people. Put them first.

To promote the strongest business partnerships, build a team of people who have walked in your clients’ shoes. 

By Michael Trinkaus  

To maintain a good life or a flourishing empire, Roman emperor and Stoic philosopher Marcus Aurelius advised readers nearly 2,000 years ago to “Look well into thyself; there is a source of strength which will always spring up if thou wilt always look.”

Fund services should take that message to heart.

Firms that provide administration, tax, compliance, auditing and other services are helping their clients create foundations for growth and prosperity. But they can only be effective if they understand what constitute success, often from the perspective of the person most intimately acquainted with a firm’s bottom line: the chief financial officer.

[See Episode 1 of the Private Capital Strategy Series for more on this]

Admittedly, the talent pool out there is small. It’s very hard to find folks with the C-suite experience necessary to thoroughly understand the CFO’s role today. But investment managers can see which service providers are making the grade by examining the careers of the principals in a firm – intelligence that is likely to become more valuable as more money enters the markets in search of acceptable risk adjusted returns.

This new dynamic means that firms are going to have to work extra hard to keep their folks happy and allow them to focus inward as well as outward to grow. In our view at 4Pines, if team members leave, as some inevitably do, their endgame should be to become a CFO if they are the type of folks suited to the firm in the first place.

On the front lines

The needs of CFOs are at the forefront of financial services today, of course. Think hand-filled subscription documents, wet signatures, compliance, data management and other tasks. The solutions are also within the CFO’s wheelhouse, too – automation, artificial intelligence, cloud computing and other innovative technologies that can oversee and balance performance and operational costs.

Consider it the new model of fund administrative – for CFOs by CFOs.

Technology alone doesn’t cut it

New tech to solve old problems has become a mantra in the fund administration space. It can certainly automate tasks such as the tedious subdoc process, saving time and money and harnessing the data we need more effectively.

But without the right people, a solid team, it’s nearly impossible to integrate technology to move a firm forward, much less the entire industry.

To that point, tech does not replace people. It must empower them. It has the power to unlock talents, freeing people up to focus on the creative, flexible and nuanced aspects of client engagement that offers solutions to complex problems. And while it can quickly identify client concerns by doing that behind-the-scenes work, automation, machine learning and other innovations are just the first steps to a new and broader fund administration model and growth.

Another way to think about it is what we call the technology “sandwich.” It starts with people, it ends with people. Technology. Sits in between. But it’s the people on either side that make it work.

Down with silos

So, what is the new model if you accept success starts with people on either side of the technology? And how can it help fund administrators improve operations? Integration is the key, the way an in-house team in private equity is operates, with a special focus on client services.

Clients – usually CFOs – expect to reach out to real people. It’s long been a problem that they have been cut off from the people actual administering their funds. In the new model, clients gain closer access. That translates into allowing fund accountants, investor-facing relationship managers and others who usually operate in silos to become more integrated with each other and their clients. That also allows the CFO to work with everyone more closely.

In this model, fund administrators are empowered to deliver more boutique-like services to clients, which will certainly make for more satisfied customers. At the same time, it helps to reduce turnover among staff because members of teams are happier, leading to a more solid whole.

This new framework means seamless fund administration for asset managers and as such, administrators who are part of the internal team. That’s about trust and relationships and tech.

But most of all, it’s about people.

Michael Trinkaus is Chief Executive Officer and Co-Founder of 4Pines Fund Services