I am part of the sales team for a midsized asset management firm. While our product line is diverse, we are considered a traditional, long-only manager which I fear may be a dying breed, but I hope not. My question is that when we are nearing the end of the due diligence process, I really need to have one of our portfolio managers attend the meeting because I think I've brought the prospect as far as I can by myself and now need the “investment expert” to participate. Unfortunately most of the portfolio managers think I am bothering them and really only agree reluctantly and their attitude shows during the meeting. What do you suggest?
The importance of portfolio managers attending final presentations
Based on your description of their non-team spirit and general negative attitude, I will assume that the investment team's compensation is not tied to asset growth, revenue growth or profitability of the firm.
I am not suggesting that a portfolio manager's compensation should be tied to any of those measures, because then they may not totally focus on what should be their biggest contribution to the firm: producing a positive and sustainable alpha. If they at least can do that, then you and your firm will be considered for new business in the future.
I have seen the problems that arise when an investment professional's compensation is tied to any or all three of those measures, and it's bad. They spend a great deal of time monitoring your activity, your success in getting meetings and of course, your ability to bring in new business as if that job is yours and yours alone. This is especially true in firms that have multiple products where each product head thinks he or she is being shortchanged because, for instance, you're spending too much time on equity rather than fixed income or on active vs. passive products.
You clearly want the portfolio managers to focus their attention on producing competitive rates of return, but as you rightfully point out, you will be in “semifinals” or “finals” where the asset owner is going to want to meet, assess, learn from and be presented to by the investment professionals. That is only logical and that phenomenon really hasn't changed over time. Imagine if you were scheduled for major surgery and couldn't speak with the surgeon before the operation.
If you can't convince your investment management team that it is in everyone's best interest to grow the business and that their participation and contribution to that effort is critical if not mandatory, then you really need to have a brief discussion with senior management, which are generally compensated for new business and asset growth. Moreover, they are usually responsible for determining how portfolio managers will be paid and most likely will understand that portfolio managers are required to make a presentation at some stage in the due diligence process.
Successful investment management firms understand how each group within the firm all work together to produce a product that the asset owners need and want in order to meet their objectives and expectations. If you can't get everyone on the same page with regard to demonstrating mutual respect and championing the teamwork required to achieve this success and you feel these folks and their attitudes are entrenched with no change in sight, then it's time to move on.