Executive Sponsorship: It’s the Difference Between Success and Failure

It is difficult to overstate the significance of executive sponsorship in the implementation of fund administration software. Without the right people backing the decision and driving the process in the right direction, even the best-fitting software system can fall flat and wind up as a useless, forgotten tool in a year.

So, to make your software investment pay off, you’ve got to secure ongoing and engaged executive sponsorship.

Executive Sponsorship Is More Than Just Executive Input

Typically, during the sales process, we deal with a small group of decision-makers. In most cases, that group is made up of the CEO, managing partner, and potentially others at the executive level.

Naturally, these people do extensive research into which tool is the best fit for their business and they thoroughly vet each company they’re considering. However, after they make a purchase decision, they tend to toss the responsibility to lower-level employees with a “Here, implement this,” type of directive.

In other words, they provide executive input on the purchase decision but no executive sponsorship for the software implementation and user adoption phases.

A couple of things usually happen at this point. First, the employees who have taken over the project end up guessing at what information should be tracked and how the system should be configured because those issues are outside the scope of their normal work. Then, when the executives who made the purchase decision see the system for the first time, they’re disappointed to discover that it only meets, say, 75% of the needs they hoped it would.

In response, they go back into executive input mode and suggest that additional fields be added. But this still doesn’t qualify as executive sponsorship. And it creates more work for the group performing the implementation.

Executive Sponsorship Can Prevent Time-Consuming Restarts

When executives re-engage with a software implementation project and ask for modifications to be made, this can be frustrating for the implementation team. They’ve typically spent hours importing data into the new system utilizing the fields they had initially defined. When they’re tasked with adding fields retroactively, they must export the data, modify it, and import it a second time. Needless to say, this can be a time-consuming task.

Maybe you’re thinking, “Why don’t they just add the new fields but leave them empty until a later time?” The reason that’s not ideal is that before a firm trains its people on how to use a new system, the software must be set up properly and completely. Otherwise, you end up doing additional training later, which wastes valuable time and can be confusing to users who were already getting familiar with the software as it was originally implemented.

That approach can also hinder the adoption of the new system. Launching without all the appropriate fields and data in place makes it difficult for users to see the software’s potential and more likely that they’ll ignore the system and keep doing things the way they always have.

Who Should Be Your Executive Sponsor?

So, who should be the executive sponsor for your fund management software implementation? We recommend having a senior-level champion to guide the process and lend support.

But a well-executed implementation requires other support, as well. You should also involve a mid-level employee who does more of the implementation “dirty work” but is still senior enough to understand how your organization operates and the business processes you use. This person must know what data should be tracked and have enough authority within the organization to effectively engage senior executives for feedback, while also providing encouragement and direction to system users.

In short, an effective software implementation requires strong leadership, with an executive sponsor to spearhead the initiative and a “second in command” on the implementation team to coordinate the process.

If that seems like a significant amount of time and resources to invest in this type of project, it is. But it pales in comparison to the time you’ll spend making post-implementation corrections if you don’t have the right guidance for your project.

And… The efficiency and productivity gains your firm will enjoy with an advanced fund management solution from Altvia will make your executive sponsor (and everyone in the firm) glad they invested the time to get things right in the first place!

executive sponsorship

A traditional crm was built for general ‘customer’ scenarios

Software platforms have made the world a better place by making work a better place. Indeed the world is better off when people enjoy their jobs even marginally more, and workplace applications on big CRM platforms like Salesforce.com have done that and much more.

But the potential that platforms like these offer presents diminishing returns: once the platform provider has engineered too many industry specific components into its platform, its usefulness for other industries begins to be threatened, and with that so do the usefulness of the component tools built into the platform.

So it is with the CRM category that Salesforce.com has defined: it is generic enough to work for many industries, and yet still offers the potential for others to round off the edges and nail more vertically-oriented and extremely tailored software solutions.

Private capital markets are actually a great demonstration of this dynamic. Where generic CRM platforms simplify — appropriately so — to assume there’s a business, a customer, a sale, and service of that customer, there are a few industry-specific pieces that are missing.

Take for example, that investors become customers by investing through legal entities the GP raises. It’s a subtle but important nuance that just doesn’t make sense at a platform-as-a-service level (because it’s overly complicated for a simple one-time sale that many industries require), but which can easily be added without 10 years or software engineering. Once provided, the rest of the platform’s components become tremendously powerful again and you’re set to take over the world.

As a traditional CRM in our pillars methodology, these nuances must be present to properly account for investors in these legal entities, potential target companies and which are owned by these entities, the context of all interactions with these parties (as well as the appropriate overlap, ie co-investments), and how you’re arriving at finding these opportunities on both sides of the equation, such that you’re able to piece together what’s effective and what’s not. Not just because we say so, but because these are the very relationships and data that are key to the motivation behind a CRM in any industry.

It’s critical, too, that the valuable publicly-available information that helps to enrich CRM systems and save users painful steps of entering it themselves is fully-integrated at the platform level.

Again, look no further than the 3,000+ pre-built integrations that Salesforce.com — the creator of the CRM platform concept — has at a platform level to do so, and which only exists by way of holding just short of overly-specifying certain industry workflows that would present challenges to properly integrate.

Stakeholder reporting and communication (investor relations) draws on a range of datasets

The traditional “customer service” model of CRM systems once again makes overly-simplified assumptions about the customer relationship when applied to private capital markets.

In fifteen years I personally have yet to hear the terms “warranty” or “service call” in this market because it’s just not the same. But make no mistake, as uncomfortable as it may be to say aloud, customer service is more important now than ever and it’s constantly happening; the industry is, after all, considered to be a financial “service”.

As it turns out, that service is primarily information-based — it’s driven by data and takes the form of reports and analysis that drive decisions, and then end up again in investor-facing reports and analysis.

The foundational elements of a private capital markets CRM must be built such that they accommodate this data (like we discussed above), but so too that it can accommodate additional supporting data that investors (customers!) need in the context of service.

Oftentimes this supporting data — financial metrics and time-based values, for example — is believed not to meet the traditional definition of CRM and the natural thought is “well, better do this in Excel!”.

While I happen to believe Excel is still the greatest software application ever built, its introduction to this value chain we’ve discussed herein actually creates the problem many firms suffer from: key data needed to provide customer service (again: effectively the entirety of a firm’s reports and analysis) is now in disparate systems and detached.

Both of those dynamics are important and distinct: not only is this supplemental data disparate, but when brought together there is no logical association that can be made between the two data sets.

Allow me, then, to make the point very simply: not only can this financial and time-based value data (you may be thinking about is as “portfolio monitoring” or “accounting”) be a part of a CRM, it is arguably the most important part of a CRM because it’s at the core of what providing service to the customer entails — information that comes out of data!

Firms need a digital method to engage stakeholders (ie investor portals)

Investor portals are not new; in fact, for many of us — including myself — they conjure up horrifying nightmares in which we’re aimlessly guessing at folders to find the newest document we need.

So in lies the opportunity: not only have the portals we’ve come to hate not simplified the process of acquiring information, they’ve failed to create an entirely new experience that is “customer service” driven.

To be fair, this is not a B2C market where you’d be long out of business for not having focused on customer service and thus the customer’s technology-driven experience. But don’t expect to be around too much longer if you aren’t thinking about this shift.

Today’s institutional investors increasingly expect this same consumer-like experience, and a massive opportunity is being missed by not providing it. It’s not about providing them the experience they desire; it’s more about the ability to measure engagement that is had in return.

Put simply: what’s keeping the market from providing this experience is the availability of the information that’s required to create the service that provides the experience.

If you’ve hung in this long, you know that by focusing on your CRM, you have the data that’s required to manage the customer relationship and the technology-driven experience through which that information is shared to create a differentiated and opportunistic customer experience.