From technology provider to service delivery partner
FIS: Best Fund Accounting & Reporting Software – The past year has seen the role of the technology service provider evolve from a more transactional function to a coveted consultative partner.
This has been the most transformational area of focus for FIS. The firm has been working to change the nature of its relationship with clients. Trevor Headley (pictured), VP, Hedge Funds, FIS notes: “We are moving ourselves into more of the co-sourcing and outsourcing realm. Rather than just being considered a technology provider, FIS is now being seen as a service delivery partner. We can help our clients through spikes in operational activity and solve for key-man risk with our managed services platform.
“Over the course of 2020, we have evolved our product offerings to look at some of the adjacent or complimentary areas to our business. These include middle- and back-office services like reconciliation, corporate action processing and risk reporting. We take these opportunities to empower our clients with solutions to manage more assets and grow their AUM with less resources.”
This change reflects an overall industry trend which is seeing more hedge funds taking on third-party partners for non-alpha generating activities.
In 2020, FIS also acquired a majority stake in Virtus Partners, a credit-based alternatives fund solutions provider. Headley discusses the impact this has had on the firm’s strategy: “The acquisition is now enabling us to look across the spectrum from hedge funds to credit and CLOs. We are extending our capabilities and empowering a full workflow from a technology and business process as a service (BPaaS) perspective.”
As managers aim to focus on return generation, the role of service partners like FIS is to help them optimise their pursuit of alpha, especially in the face of downward fee pressure. “We play our part in being able to deliver lower total cost of ownership to our clients. Also, in view of the move to virtual due diligence, we partner with them to smooth out that process from a cybersecurity and IT infrastructure risk point of view,” Headley outlines.
The outlook for the hedge fund industry is bright and this consultative role service providers are taking on is bound to become even more instrumental in providing next-generation growth. Headley says: “We will continue to look at the industry strategically across asset classes and fund structures. Our aim is to improve the way we integrate and deliver comprehensive solutions which allow firms ultimate flexibility.”
Another area of focus for FIS has been around enhancing operational efficiencies. Headley comments: “We’ve placed a lot of emphasis on improving workflow management. This is a central theme across our front-to-back-office platforms. Within our back-office platforms, we’ve focused on report generation and automation to improve the delivery time of those reports.”
Further, the shift from LIBOR to alternative reference rates is also a pressing issue in the accounting domain. “There has been a lot of emphasis to ensure our clients are prepared for the transition. As a provider, we have made sure our platforms can support the gamut of alternative reference rates. We also launched an educational campaign to inform clients and support them in understanding how it will work from a workflow and operational point of view,” Headley underscores.
As managers continue to face challenges amid the opportunities, partnering with a transformative organisation like FIS provides the means to help them successfully navigate the shifting environment.
Trevor Headley, Vice President, FIS Hedge Funds
Trevor Headley is a Vice President of Product Management, Hedge Funds at FIS. He is responsible for strategy and go to market for the Buy Side Portfolio Manager. With more than 15 years of product development experience, Trevor manages the process of converting strategic directives into tangible solutions and the delivery of the roadmap.