Culture will trump strategy for wealth and asset managers

In an industry being reshaped by fee pressure, operating complexity and AI, strategy alone won’t deliver an edge. Apiramy Jeyarajah argues that for wealth and asset managers, culture is the real advantage.

It is difficult to overstate the level of change sweeping through our industry. We all know it’s happening, and can feel it, but the true professional and organisational implications are all too often pushed to the back of our minds. 

Putting aside all the investment challenges for a moment, the shifts in distribution and operational realities are immense. As McKinsey deftly noted recently, “the industry continues to face a range of structural challenges including eroding revenue yields for high-fee equity mutual funds, indigestion in private markets, and operating complexity that has kept cost pressure stubbornly high.” [1]

Assets across the industry may be up, but profits are stuck. Firms are grappling with how to scale effectively, and yet are missing the crucial component: their people and culture. And with the lines rapidly blurring between leadership, management and execution, flatter and more dynamic organisations that respect HR and learning development will surely hold an edge.

Working for a nimble and agile organisation is therefore a breath of fresh air. Backed by a larger entity, but with enough freedom to be entrepreneurial and innovative, we take inspiration from our boutiques’ founder-led models and mindsets. 

Heart over head: Agility, curiosity and teamwork

As I think about how we can thrive through the next 5-10 years, I am reminded of the story of Helen Glover and her GB selection in 2012.

Her selection, like others in the 2012 cohort, was unconventional. A late starter to rowing at age 21, she wasn’t the tallest or strongest, but chief Team GB coach Jürgen Grobler backed her heart. Having found her through a talent ID programme called Sporting Giants looking for raw potential, he saw a champion’s courage and spirit in her eyes and the way that she trained. The rest, as they say, is history (i.e., a gold medal in the women's coxless pairs with Heather Stanning).

This story carries weight and stretches across disciplines because thriving over the next few years will require heart and courage. We will need to unlearn things, which will be uncomfortable. What we ‘knew’ yesterday might no longer hold today, let alone tomorrow. Being agile and constantly challenging assumptions is something built into entrepreneurial mindsets and is why the osmosis-like cultural transmission with our boutiques is so crucial. We can learn from their determination and heart. 

My emphasis on culture is not an argument for abandoning strategy altogether. Strategy is crucial for setting direction, defines trade-offs and protects focus. But when the world is moving so fast, culture becomes the strategy-execution engine. It determines whether you can learn quickly, reorganise calmly and keep doing the right thing for clients.

Traditional approaches to strategy implementation will not work in this environment. Detailed three-year plans, rigid organisational structures and tightly defined roles quickly become anachronistic. By the time you have designed the optimal operating model, adviser channels consolidate, regulations shift, technology leaps forward or a competitor changes the rules of engagement.

Me, my team, and AI 

The biggest elephant in the corporate strategy room is artificial intelligence (AI). 

Every executive team has it somewhere in the agenda pack, and every department is testing tools with trepidation and excitement in equal measure. But technology that is widely available can never be the differentiator. The real differentiator is whether you make the cognitive and cultural shifts needed to harness it properly.

In investment businesses, this plays out in concrete ways. Are analysts encouraged to use AI to synthesise earnings call transcripts, map competitive landscapes or pressure-test assumptions? Do distribution teams use it to produce first-draft meeting briefs, personalise follow-ups and speed up RFP workflows, while keeping humans responsible for judgement, tone and suitability? Do operations and reporting teams use it to automate data validation, draft client reporting and flag anomalies?

None of this is possible if people are anxious about job security or embarrassed to admit what they don’t know. Left unchecked, resistance to new workflows will swallow any potential efficiency gains. Leaders must make it safe to learn, ask questions and say, "this isn’t working, let’s adjust”. The management point is not to ask people to work harder or “wear more hats”. It is to create a culture where teammates have each other’s back, where learning is valued and where adaptation is normal rather than threatening.

Organisational adaptability

This cultural imperative extends to organisational structure. We need to move beyond positional, transactional interaction (the classic 1:1 hierarchy) to more relational, collaborative ways of working. The latter aids rapid learning and faster decision cycles without constant structural overhauls.

Cast your mind back three years. Many firms spent serious time debating sales coverage models: regional sales teams versus tele-sales based in one location, as well as the pros and cons of specialist sales roles in areas like ETFs. The bulk of these plans are already redundant. Advice platforms have consolidated. Model portfolio providers have grown in influence. Strategic partnerships and gatekeepers are reshaping distribution dynamics.

The real competitive edge is therefore in building a culture where people can reorganise around emerging opportunities and shared client values. For example, forming cross-functional “pods” around a key partner, or bringing investment, product and marketing together to create a solution quickly when client needs shift. There is also a growing body of evidence that teams perform better when people feel safe to speak up and take interpersonal risks. Researchers call it psychological safety[2].  In fast-moving environments, this is not a “nice to have”. It is a prerequisite for continuous improvement.

None of this is easy. Cultivating a great culture is much harder than writing a strategy document. Hiring for curiosity and adaptability takes longer than hiring for technical qualifications. And maintaining client focus while transforming internally requires constant vigilance.

But in a world where the levers of profitability are changing, and where no one can confidently predict the next shock, adaptability should become a defining advantage.

[1] Asset management 2025: The great convergence, Mckinsey & Co, 18 September 2025.
[2] Google re:Work, “Understand team effectiveness” (Project Aristotle) and Amy Edmondson, “Managing the Risk of Learning: Psychological Safety in Work Teams” (HBS working paper).

Disclaimer
This article reflects the views of Nedgroup Investments and is intended for informational purposes only. It does not constitute investment advice or a recommendation to buy or sell any financial instruments. All investments involve risk.