4 Questions to Ask When Procuring an Investment Management Software

If you’re an asset manager, asset owner, or hedge fund manager looking to scale, manual Excel spreadsheets or flush/fill systems just won’t cut it. You need to procure an IMS tool that’s robust enough to meet your growing needs.

But what tool do you need?

An Investment Management System (IMS) is the answer. A sophisticated IMS will help attract bigger clients, make rules and regulations compliance easier, and advanced calculations possible. 

Keep in mind that an IMS can be beneficial for new firms, as well as established firms that have outgrown their existing system. Being proactive about your IMS procurement will help you stay ahead of the curve.

Here are 4 questions you need to ask yourselves when procuring an IMS:

1. What do we actually need in an IMS?

The temptation to jump straight into IMS procurement without doing the necessary preparation is the number one stumbling block most firms encounter. Before you do anything, you need to hit pause, gather your team together, and get crystal clear on your business needs. Otherwise, you’ll end up with a system that’s way too sophisticated, too expensive, or unable to perform the critical functions your business needs today—and into the future.

Think about a typical day at work:

• What is your current situation and workday like? 
• What are the problems that come up most often? 
• Where are you wasting time? 
• What do you need in a system to increase your effectiveness, efficiency and accuracy?  
• What’s been on your wish list the longest? 
• What are your must-haves, vs your nice-to-haves? 
• What are your goals for the future?

Consider whether an older, more established IMS can provide the solutions you need, or do you need a system that was built to anticipate how technology and the investment industry is changing? 

It’s important to think about your growth trajectory. Will the system you choose grow with you? Is there functionality you can add later as you need it? What kind of clients are you trying to attract? 

The firm you want to become is just as important as the one you are today.

2. Will the IMS we procure work for me and my organisation? 

Did you know that some providers (but not all!) will let you take a new IMS for a test run? Consider taking it one step further by asking each potential vendor to use your own data. This will help you see if the system will truly work for you. 

Just as you would for any other purchase, check reviews and case studies to see how well different IMSs are working for others. Ask the IMS provider if you can talk to current clients. They may even be willing to put you in touch with past clients. This is a tougher ask but if they’re open to this, it can be extremely helpful. 

Next, ask if there are different packages or options available to suit your unique needs. Some providers offer levels that vary depending on the size and requirements of your business. A good IMS should work with you, supporting your growth and always thinking ahead, so it's important to consider you current and future needs throughout your IMS procurement process.

3. Are we suffering from ‘feature blindness’?

All the latest and greatest functionality is great, but is it really necessary? We like to call this ‘feature blindness’ because you end up focusing on all the latest tech, while missing out on what’s actually important for your company.

That said, features and functionality are still a huge consideration. Will the IMS keep up with changes in the industry? Consider your own unique needs, as well as the changes precipitated by COVID-19. Then determine if the features you’re considering will enable things like working from home, seamless upgrades, automation/machine learning, cutting-edge security, and cloud-based capabilities.

At the onset of the pandemic, it became clear that some existing solutions were not fit for the new world. For example, asset managers who historically resisted off-site cloud technology were left scrambling to communicate and connect during lockdowns. Your procured IMS system needs to be able to respond to future needs in a post-COVID world, as well as the future of your unique business.

When evaluating vendors, it's important to get below the "standard demo", where life is rosy, and everything is working as expected. To help you do this, we've built a tool that aids your decision prioritisation and gives ideas on difficult questions to ask vendors. Try it for free at:

4. How does the migration process work?

Procuring and setting up a new IMS is a significant undertaking, but there are huge variations between IMS vendors in the time it takes, how easy (or difficult) it is to implement, and how disruptive it is. 

Ask if the work can be done in stages to limit work interruptions. You’ll also want to understand what training and implementation support is available. When you get to this point, it’s not about features and functions, but about change management. How will your IMS vendor help with that process?

The takeaways

Deciding which IMS to go with is a big decision, whether you’re starting from scratch or shifting to a new provider. Do your research – some systems can take six months to a year or more to implement; others as little as three months. Be sure the IMS you procure fits your business needs, both now and in the future, and stay focused on your goals and solutions, rather than a long list of fancy features. 

The right IMS can also make a huge difference to your bottom line, your ability to scale, and your efficiency, effectiveness, and ease of work. It will help you address future challenges to the investment world, make you more attractive to top talent, and make it easier to comply with rules and regulations while maximising your growth potential.