The asset management industry of today is complex and moving from a growth industry to one that is flat. This shift is due to a variety of challenges facing the industry as a whole. These headwinds include the move to passive investing, compression on fees, rising regulatory costs, the war for talent, macroeconomic factors, and the impact of technology, amongst others. Several of my industry contacts have likened these systemic changes to what has happened to the sell-side since the Global Financial Crisis.
In this market, firms need to reconsider their approach to senior leadership positions. Historically, firms have tended to follow more of a cut-and-paste method to staffing. They’ve sought candidates who have spent most of their careers performing a particular job function, and placed them into nearly identical positions.
It’s my view that senior leadership candidates with multi-faceted backgrounds can drive change to help solve the problems firms are facing today. For example, people who have sat in different seats – or have management experience within different areas of their organization – are strong candidates for disruptive leadership positions. People who have straddled investments, product and operations, or have spent time on both the institutional and retail sides of an organization are more agile – a required trait in today’s turbulent times. Candidates like this are more likely to bring a breadth and depth of experience to new leadership roles that need out-of-the-box ideas as well as a holistic perspective.
The other side of this equation relates to the opportunities awaiting strong candidates with varied skills and experience. Given the current state of the asset-management industry, individuals who have spent time in diverse roles may benefit from recognizing that they may be the best candidates to drive change from new seats within their chosen organizations. These people have unique opportunities available to them at this time, and can act to leverage and maximize them.
For the asset management industry to meet today’s headwinds head on, firms and their leaders must evolve their thinking and corresponding actions. Adopting a new approach to leadership roles is a step in that direction.
If you have questions or would like to dialogue on any of the topics addressed in this piece, please feel free to contact me.