AIMSE 18TH ANNUAL CONFERENCE- EDUCATIONAL SEMINAR

Career DevelopmentCareer Development

SKILLS NEEDED FOR MARKETERSSKILLS NEEDED FOR MARKETERS

Kim Yates, DirectorAsset Management Practice, Principal Search

1st February 20061st February 2006

AGENDA

How did we arrive at where we are? A look at some major events that have changed the asset management industry

Career management – how can you maximise your potential in an increasingly specialist market….

HISTORY OF ASSET MANAGEMENT

Late 19th century: Investment Trusts1931: M & G Launch first UK Unit Trust1970s: Development of Pension Fund Management1980s: Dramatic Growth of Mutual Funds1990s: Growth of AUM, economies of scale, acquisitions by banks and insurance companies2001-03: The Perfect StormPresent & Future: Horses for Courses

Growth of UK Pension Assets 1963 - 2004

£ billion Value at 2000 prices

0

200

400

600

800

1000

1200

1400

1600

Source: ONS, UBS

Projections for total UK Pension Assets

Source: UBS Global Asset Management estimates based on data from National Statistics, Inland Revenue, Association of British Insurers

150 180

630820

160

340430

770

0

500

1000

1500

2000

2500

end 2004 end 2014 (in 2004money)

£ b

illio

n

Personal andstakeholder pensionsSelf administereddefined contributionSelf administereddefined benefitInsurance/administered

Internationalisation of US Pension Plans

Source: InterSec Research

U.S. Tax Exempt Active and Passive Assets: Cross-Border Mandates (US$ billions)

$-

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

'75 '79 '85 '90 '95 '00 '04 '09

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%Assets (left)

Allocation (right)

© 2005 InterSec Research

WHERE DID IT ALL BEGIN?

Companies asked their bankers to help manage pension assets in the early days hence the dominance of the merchant banks – Warburg (subsequently Mercury/MLIM), Schroders, Morgan Grenfell, Flemings, Hill Samuel

Independent managers (Henderson, Geoffrey Morley, GT) challenged the merchant banks and the business development function emerged in the early 80s

THE BUSINESS DEVELOPMENT FUNCTION GROWS UP

The development of business development skill and practice were largely learned from the US

Management of Consultant Relations

Development of dedicated RFP teams

Direct Sales Activity

Training for Beauty Parades

THE BUSINESS DEVELOPMENT FUNCTION GROWS UP

Sales initially called “marketing”

By 1990 Sales and marketing differentiatedDedicated consultant relations function

Late 90sBalanced to Specialist trend well advancedProduct Champions introduced to support

sales of multiple specialist products

CLIENT RELATIONSHIP MANAGEMENT IS INTRODUCED AS A SEPARATE FUNCTION

Previously undertaken by a combination of investment managers and back office administrators

Large firms such as MLIM and Schroders split the investment teams around 2000

CRMs now recognised as a critical function requiring specialist skills and knowledge

Revenue generation is now an important part of the CRM function

INSTITUTIONAL BUSINESS STRUCTURES- Model 1

Institutional Sales D irec tor M arketing/Sales Support C onsultant R ela tions C lient Service

Institutional B usiness M anager

INSTITUTIONAL BUSINESS STRUCTURES- Model 2

R ela tionship Management T eam- Prospects

- C lients- C onsultants

M arketing/Sales Support

Institutional B usiness M anager

CLEAR DISTINCTION OF MANUFACTURING AND DISTRIBUTION – An Opportunity for You

Success = Superior Investment Performance + Strong Client Relationships

Power base of distribution has increased enormously since it took “ownership of clients”

Business management skills largely held in distribution – the role of CEO is now in sight

RAPPROCHEMENT OF RETAIL AND INSTITUTIONAL

Historically retail was regarded as the poor relationBut margins are good and it is growing fast Patterns of distribution are changing “pushing product via IFAs is no longer the name of the game”Key distributors need sophisticated levels of technical service as well as highly commercially tuned business management skillsSkills needed for wholesale distribution are closer to those in the institutional marketRemuneration for retail sales directors has now pushed ahead of their institutional counterparts

“They are never prepared enough about our fund and most of the time waltz in and say “tell us about your fund.” I expect more, there are dozens of publications to tell them about our fund”

“It is extremely variable, too often sales people don’t have the level of detailed knowledge which we need”

“25% are the good ones – they distinguish themselves by understanding our needs and have more technical knowledge”

“Quality is variable and you know within 5 minutes whether they are knowledgeable”

“Some are more subtle than others, subtlety being a virtue!”

– “Variable quality, either very good or very bad”

SKILLS NEEDED FOR SALESMEN AND WOMEN

PENSION FUND SURVEY - CLIENT SERVICING

Good quality client servicing is a basic requirement “I take it as read that we should have accurate and timely reporting”“We would soon let them know if there were things that we were not

getting from them”“My manager was strong in client service but they did not invest

enough and fell behind”

Competitive advantage comes from adding value over and above the service level agreement

“We should be leveraging on the experience of our managers on a whole range of issues where they have something significant to say”

“ A CRM is great as a focus but not as a block…post Myners we need to know much more”

“We noticed much greater efficiency in having one central contact…we were always bothering the fund manager before”

SKILLS NEEDED FOR SALESMEN AND WOMENWhat our clients say they want…

Personal attributes

Communication skills, including language ability

Ability to listenTechnical investment knowledgeEnthusiasm, energyFlexibility, entrepreneurial spiritStature, maturity, credibilitySelf-motivation, self-starters, team playersResults driven, natural salesman

SKILLS NEEDED FOR SALESMEN AND WOMENWhat our clients say they want…

Professional qualifications/experience

Compliance – IMC, CFATechnical product knowledge at an increasingly

sophisticated levelMarket knowledge – pensions practice and

legal/regulatory framework, local influences

Personal Contacts

SKILLS NEEDED FOR SALESMEN AND WOMEN- What my clients and your clients do not want…

Product pushOver-promise, under-deliverDelivery of something other than what they boughtMeetings/calls for the sake of it – if you don’t have anything to say, don’t say it, think of something Off target salesOver-spending on the sales process Desperation!

AND FINALLY CAREER TIPS…..

Work hard Demonstrate, don’t claimDo what you are asked to do and do what you say you will doDon’t take it personally and don’t get intimidatedWhat you don’t ask for, you don’t getManage your clients’ and your boss’ expectationsDon’t jump from job to jobBut move jobs occasionally to enhance job status and remunerationNetwork(and be nice to headhunters, you never know when you might need them)

Enjoy your work, be proud of what you do