Client Case Study SEB Asset Management Increases Productivity by 500 Percent with Advent Solution OVERVIEW Advent creates “revolution” at Danish firm KEY BENEFITS ■ ■ ■ ■ ■ ■
500% productivity gain 80% decrease in administrative work Dramatic reduction in errors Fast management reports Exceptional system speed and ease of use Happier employees
SEB Asset Management Denmark, established in 1999, is not just another Danish investment firm. To start with, the Copenhagen branch of SEB Asset Management enjoys a unique advantage that many more-established competitors can only dream of: the backing of Skandinaviska Enskilda Banken (SEB Group), one of Scandinavia’s oldest banks. With US$85 billion under management, SEB Group is also one of northern Europe’s largest asset managers.
An Advent Advantage Another advantage: SEB Asset Management Denmark also leverages the trade order management, portfolio management, and client relationship management solution from Advent Software. SEB uses the integrated solution to manage portfolios and mutual fund investments for 50 institutional investors and 200 private clients. Since implementing the Advent solution, the Danish office has increased its assets under management to US$14 billion. And while its staff has grown to 80 employees, the number of administrative personnel has dropped sharply, thanks to a 500-percent rise in operational efficiency.
“We’ve reduced our administrative staff from 15 people to just 3. That is quite amazing. And the reason is our state-of-the-art solution from Advent.” Jens Nødskov, CEO SEB Asset Management Denmark
Reducing Administrative Staff by 80 Percent “We’ve reduced our administrative staff from 15 people to just 3,” says Jens Nødskov, chief executive officer of SEB Asset Management Denmark. “We are handling 80 billion Danish Krone (DKK), which is more than US$14 billion, and we have three administrative staff to handle it. That is quite amazing. And the reason is our state-of-the-art solution from Advent.” Before using Advent, SEB relied on another portfolio management system, together with spreadsheets, to manage client assets. These tools, unfortunately, required a great deal of staff resources to create reports, generate trades, and perform allocations. With the other system, says Nødskov, “you had to hire a consultant just to help you get into the report, and then it took half an hour to generate the report.”
A Revolution Advent changed this situation completely. “From the beginning, the portfolio managers were quite satisfied with the Advent solution because it was so automatic to perform trade allocations,” Nødskov observes. “From the portfolio manager’s point of view, it was a revolution.” Among the system’s key strengths, Nødskov cites speed and ease of use.
“From the portfolio manager’s point of view, it was a revolution.” These are welcome advantages for portfolio managers whose time is already at a premium. In fact, because SEB portfolio managers also double as researchers and analysts, they spend a great deal of time outside the office, visiting companies represented in their portfolios. This responsibility leaves little time for learning difficult systems and generating complex management reports.
Updated AUM in 10 seconds Fortunately for SEB’s portfolio managers, Advent is neither difficult nor complex. The software enables them to quickly create reports without wasting precious time. “It’s nice to have a system that’s automatic and very easy to use to get an overview,” says Nødskov. “For example, for me, who is responsible for the whole business, it’s possible to get a fully updated overview of assets under management in just 10 seconds. And I don’t need any skills to go through the system. So therefore it’s quite a fantastic system for us, because you don’t have to spend a lot of time.”
The system has also enabled SEB to automate and integrate its trade order management process. Built on spreadsheets, the old process required SEB Copenhagen staff to fax or call in orders to their colleagues at SEB Asset Management Stockholm for execution and allocation. Naturally, these procedures, which required several manual data entry steps, were slow as well as error-prone.
“We received the results of this study, and we learned that we’re number two in Denmark,” says Nødskov. “And then we went down into all the figures and discovered why. A major reason is our reporting. It’s state-of-the-art, and it’s really because the Advent solution is very good at reporting.”
An Open System Effective Portfolio Modeling Now the Danish office electronically routes trades from its Advent trade order management system to the same system at the Stockholm office. With far fewer manual steps, trade allocation takes a fraction of the time. Advent also provides sophisticated modelling tools that make it easier for portfolio managers to apply a consistent investment strategy across selected portfolios or SEB mutual funds. “Our style is to model portfolios,” notes Nødskov. “It’s like a factory. We create a model portfolio and then mirror it into different client accounts.”
Impressive Performance These Advent tools have enabled SEB Asset Management Denmark to achieve impressive performance results in a lackluster market. In 2002, for example, the firm generated an average return of nearly 11 percent across its fixedincome investments, which represent roughly 85 percent of its assets. “In our business, it’s all about performance,” says Nødskov. “Today, our performance in some areas is much better than competitors.”
Turning Skepticism into Enthusiasm In light of these results, it’s difficult to believe that Advent once elicited skepticism when it first arrived at SEB Denmark in early 2000. “People would say, ‘you can’t reduce administrative staff,’” Nødskov recalls. “‘You will really have problems with quality.’” But not only did Advent deliver the promised efficiency, it allowed SEB Asset Management Denmark to actually improve its quality. “We had an audit by external and internal auditors,” Nødskov explains, “and the rules for these audits are pretty tough. They really check everything. And we had a clean audit report. It’s really not because we suddenly hired better people. It’s because Advent is an effective system.”
Reporting has improved further with the addition of a data warehouse, which integrates with the Advent solution’s portfolio management and reporting module to simplify data extraction for other uses. Nødskov gives much of the credit for this innovation to the open architecture of Advent. “It’s easy to create interfaces to the system,” he says. “It’s a very open system, so it’s not a problem.” Other recently integrated applications include the AG Invest finance system and a compliance database that works with built-in Advent solution compliance features and SEB’s data warehouse to check portfolios and mutual funds three times each day.
Professional and Competent In addition to Advent’s state-of-the-art solutions, Nødskov also commends Advent’s professional services staff. “Advent is an entrepreneurial company that is similar to our company when we started,” he says. “The people are professional and competent.”
“The system is working really well. I think Advent is a very affordable solution compared to what you get out of it. For us the value is very high.” All things considered, Nødskov could hardly be happier with the Advent solution. “The system is working really well,” he says. “I think Advent is a very affordable solution compared to what you get out of it. For us, the value is very high.”
Ranked Second in Denmark Not surprisingly, SEB Asset Management Denmark also received high marks in an independent research study of the Danish asset management market. Research institute Prospera ranked the firm the second best institutional asset manager in Denmark.
Advent Software, Inc. 600 Townsend Street, San Francisco, CA 94103, USA +1 800 727 0605 +1 415 543 7696 One Bedford Avenue, London WC1B 3AU, UK +44 20 7631 9240 www.advent.com Copyright © 2007 Advent Software, Inc. All rights reserved. Advent is a registered trademark of Advent Software, Inc. All other products or services mentioned herein are service marks, trademarks or registered trademarks of their respective companies. Information subject to change without notice. First published in 2002.