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The 5 Onboarding Changes Every Buy-Side Organization Needs to Make

Thinning margins. Growing competition. Tougher regulations. A volatile global political landscape. Higher transactional volumes. Greater transactional complexity. There is no lack of reasons why onboarding has become an increasingly challenging and time-consuming process for asset managers.  

However, there are steps onboarding teams can do to regain control of sprawling, inefficient processes.

SIFMA Asset Management Group and IHS Markit interviewed a group of high-performing buy-side onboarding professionals to find out how industry pressures were impacting their workflow and what they are doing to optimize their onboarding processes.

The five areas of best practice outlined below represent the key capabilities that these teams are focusing on as they re-align the onboarding function with industry changes and organizational priorities.


Establish a command center

High-performing onboarding functions are building a centralized team that works with the incoming client and coordinates across departments. This central team understands the data and documentation required by each of the various workflow teams and acts as a project manager that ensures all of the puzzle pieces are in place and the onboarding process is moving forward on schedule. 

The director of a global investment management corporation described their new, centralized process in these terms:

"We now have a project manager who oversees a team of individuals who are responsible for making sure everything's moving internally. Previously, we had the same people overseeing the process as well as taking on a host of data-capture tasks and owning the collaboration with the sell side, but we have now centralized the onboarding oversight function and delegated low-level and specialist tasks to other teams. This shift has been a way of optimizing the functional alignment and improving the client experience."


Build expert workflow teams

Several of the onboarding professionals interviewed mentioned the need to integrate specialized expertise into their teams as a way to address the complexity of the onboarding process. Many are transitioning from a generalist approach, in which a single team straddled multiple workflows, to a specialist approach where each stream of the workflow is assigned to a separate team. For example, one team interacts with the external broker/dealer setup, another team sets up the custodian, and a third team sets up any external trading platforms.

As one investment professional described it, "My team only handles the broker side onboarding. We work closely with another internal team to open the needed collateral accounts. And there's a third team that's basically under the same umbrella with us opening all of the foreign markets accounts and custodial accounts."

These core workflow teams tap into the expertise of legal, tax, KYC and other experts as needed. 


Create a central repository

In addition to centralizing the oversight of the onboarding process, firms are centralizing the documentation and data required to complete it. 

Firms that have adopted platforms to centralize and distribute the information required for onboarding move faster by reducing manual effort and enabling internal and external parties to access information more directly.  

To quantify the impact that a centralized portal can make on a firm's efficiency, we extracted data from Counterparty Manager, an industry solution used by counterparties to manage client lifecycle workflow, documentation and data. We found that, on average, banks access documents uploaded by the investment manager 200 times per year. For a smaller, mid-tier investment manager working with 25 banks and 50 entities, that adds up to 5,000 access points per year, or approximately 2,000 potential email requests.  

At that rate, even a highly efficient team that's capable of reading and responding to each request within two minutes will lose 67 hours of productivity per year to simple document requests. For firms with hundreds or even thousands of accounts and relationships with considerably more counterparties, the hours lost to productivity will rise significantly. 

When a central repository is API-enabled, the value to the firm is enhanced further, as the data can be transmitted to populate any tools the firm uses to manage the various onboarding workflows.  

One respondent said, "We're evaluating options for a portal at the moment. We would like to extend the process so clients have more visibility and can also exchange documents and data. We're even replacing the process of printing, signing, scanning, and emailing a contract with a digital signature solution." Another respondent said of the digital portal they had implemented recently, "It's the first step in a broader, multi-year client experience program that's currently underway. Our clients' first point of engagement with us is going to be more technologically supported than historically it's been, so now they're actually able to exchange data and documents with us."


Establish regular touchpoints

While many onboarding teams are actively researching and, in some cases, implementing solutions that automate parts of the process, for most asset managers today, onboarding is largely a manually-driven process. That means that moving the process forward requires a concerted and sustained human effort. 

One of the most effective ways to accelerate the onboarding process is surprisingly basic:  establish weekly calls with the various stakeholders to discuss and resolve the most pressing items. While ultimately, the implementation of an automated lifecycle solution will eliminate the need for this type of touchpoint, it is a useful interim measure to help teams keep lines of communication open and tasks moving forward. 


Leverage technology

Adopting new team structures and optimizing manual processes can significantly improve onboarding speed, efficiency and the overall client experience, but technology also has a role to play. High-performing onboarding teams are actively evaluating and implementing a wide range of advanced technologies.

One respondent said, "We’re looking at things like robotic process automation where that might make sense. We're also taking a look at client lifecycle management solutions. We're working to develop a workflow and engagement solution build on our internal operating system. Ultimately, what we're building internally is meant to connect to what we’ll leverage externally to the sell side.”     


Onboarding's pivotal moment

As the capital markets head into a new decade, onboarding is experiencing a pivotal moment. Fast-evolving regulatory imperatives and narrowing margins are putting more pressure on onboarding teams to be more efficient. At the same time, there is a renewed focus on enhancing the customer experience, with onboarding being positioned as a key touchpoint where firms can differentiate and demonstrate service excellence.

For those who lead the onboarding function on the buy side, it's a time of dramatic change, and top-performing teams are rising to the challenge by establishing a central command post and a central information repository, building teams of specialists, establishing regular touchpoints, and exploring ways to automate the workflow.


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Brittany Garland

Brittany Garland

Executive Director

IHS Markit

Member since

24 Apr 2020


New York

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This post is from a series of posts in the group:

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