Money managers need to manage their own cultures to keep a competitive edge, according to a research paper from Willis Towers Watson's Thinking Ahead Institute, a non-profit investment research organization.
In the paper, "The asset manager of tomorrow," the institute says its view is that "anything can be measured" including culture, but too many money managers do not do so. They are instead so committed to precise measurement, they treat culture as a "non-controllable" item.
The attributes of effective culture, the paper says, include associate ownership of culture, a clear linkage of culture with vision and strategy, clear and strong agreement on what constitutes cultural strength, the action of leadership to embed culture and how inclusiveness and professionalism can resonate throughout the organization.
Roger Urwin, global head of investment content at the Thinking Ahead Institute, said: "We see culture as a big differentiator in determining the successful asset management firms of the future. But perversely, many firms are so hard-wired to the use of precise measurement that they omit culture altogether in their strategy, treating it as a non-controllable item," said Roger Urwin, global head of investment content at the Thinking Ahead Institute, in a news release regarding the paper. "The dangers of this are particularly apparent when organizations confront growth and disruptive changes, as these put even effective cultures into reverse. In these situations, it is only with considerable increases in the leadership energy and focus applied to culture that you can maintain its quality and consistency."
The paper also says successful money managers won't dodge industry realities, such as the well-established idea that money management firms in aggregate face weaker revenue growth in the next five to 10 years.