MINNEAPOLIS - The business of money management will continue to evolve, as ownership structure and management capability play bigger roles, according to two speakers at a recent conference.
John Casey, president and chief executive of RogersCasey & Associates, Darien, Conn., told an audience of Investment Advisers Inc. clients that in the life cycle of an industry, money management is still in its adolescence.
"What you're looking at is the first generation going into its second," Mr. Casey said.
According to the life cycle theory, money management has yet to hit its prime stage of growth. Following that, would be a period of decline.
Different firms, though, reside in different parts of the cycle, Mr. Casey said.
The money management industry hasn't stabilized, and "at some point, an organization has to be run like a business," he said.
Similarly, Charles B. Burkhart Jr., president of the money management research and consulting firm Investment Counseling Inc., West Conshohocken, Pa., said growth for growth's sake is not necessarily a good business goal.
Profit, asset growth and revenue growth increasingly are being influenced by ownership structure, product capability and distribution, rather than size, Mr. Burkhart said.
Traditionally, the productivity and management capability of a firm gets "short shift" from its management, but that will change, he said.
And with the changes taking place in the investment management industry, contrary to what some people advocate, no single business strategy can serve as the bellwether of what will be successful, he said.
If a predominant strategy were taking hold, there would be much more consolidation than there is, Mr. Burkhart said.