Rebooting the global asset management industry

54 Rebooting the global asset management industry GenAI is Not Just a Tech Play but a People Play Too AI and GenAI offer an extraordinary opportunity to transform the asset management industry’s operating models and create value for clients. Central to this promise is the role of talent that can differentiate winners from losers. Yet, for their part, research analysts, portfolio managers and client advisors remain concerned that AI and GenAI can commoditize value propositions and devalue skills that have thus far been the key value drivers. This speaks to the importance of having a supportive work setting with clear governance, guidelines and training. A significant proportion of asset managers’ current technology-based work processes remain reliant on constant human intervention, with technology used as a supportive tool, not a direct replacement for humans. GenAI agents and humans work collaboratively when making decisions. Over time, agents may gain greater autonomy and cause a ‘digital flip’, in which the winners move to entirely different operating models, with GenAI doing much of the heavy lifting. Whether regulators will allow that eventuality is unclear at present. For now, the emphasis is on combining the analytical prowess of GenAI with the contextual understanding, emotional intelligence, and strategic decision-making of human experts, in order to unlock new levels of efficiency, personalization, and client experience. As a result, our survey respondents are implementing or are likely to implement changes that improve talent management (Figure 5.3). Their main thrust is directed at ensuring that staff have the skills, values and behaviors that support the business vision (62%). Past attempts at setting a bold vision were marred by a lack of follow-through action in these areas, creating a long legacy of cynicism about change management. Lessons have been learnt. Now the emphasis is on developing digital as well as soft skills to enable the cross-functional teamworking required by the emerging operating models (58%). After all, talent alone is not enough: team chemistry is what differentiates investment firms, as their business becomes more global and value chains more complex with growing horizontal integration via outsourcing. Talent alone is not enough: team chemistry is what differentiates investment firms. Figure 5.3 In light of the newly emerging business models, which talent pool changes are your organization currently implementing or are likely to implement over the next three years? Source: Citi/CREATE-Research Survey 2025 % of respondents Hasskills, valuesandbehaviorsthatsupport thevision Has digital aswell as technical job-related soft skills Engages in continuous personal development Has the facility towork intheofficeaswell as remotely Has the capacity to work alone as well as in teams Has the opportunity to create a personal legacy 58 51 39 32 31 62 “As staff morale drops, so do levels of engagement and performance. It is vital to ensure that staff see GenAI in a positive light.” “Tax software did not displace tax specialists, nor will advice software completely displace people. Howwork is redesigned will be crucial.” Interview Quotes