Annual Review 2006 - PwC

Why?
Our
Clients.
Investment
Management
The investment management sector is enjoying a period of
sustained growth and continued optimism, exceeding the
trillion-dollar mark in 2006 and cementing its place as the
world’s largest market on a per-capita basis.
However, while the outlook for
the industry is positive, there
are many challenges associated
with such fast-paced growth.
In order to meet the demands
of increasingly sophisticated
investors, investment managers
need to develop avenues for
sustainable alpha at the same
time as managing capacity
levels. Industry leaders are
continuing to innovate and
develop new products in other
asset classes.
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PricewaterhouseCoopers
Strong industry growth has also
exposed a widening talent
shortfall. Our industry survey,
Australian Investment
Management 2006, shows that
recruiting and retaining the best
personnel is in the top three
challenges facing wholesale
clients, after own fund
performance and increased
competition. Interestingly, we
are starting to see more
examples of the poaching of
‘star teams’ rather than star
individuals. The focus on
retention strategies continues to
intensify and needs to be more
imaginative.
Organisations will drive growth
and achieve success by placing
the customer at the heart of
every decision. Customercentric
measures must move
beyond customer satisfaction
and towards loyalty and
advocacy. Measuring the
strength of future relationships
with customers requires
measuring complaints, their
propensity to stay and buy
future products and their
likelihood of advocating a
particular company to others.
A risk gap is looming as
innovation continues and
new, complex products are
developed that stretch risk
management frameworks and
capacity. Industry participants
need to ensure that the
emerging risks are well
managed, simply disclosed,
and, ultimately, understood
by advisors and end users.