Have you decided to convert your carry and co-investment plans from Excel into a digital environment?
Yes, we decided to migrate our carry and co-invest plans to a central electronic platform earlier this year.
What were the key motivations for that decision? The error, ‘key person’ and auditability risks of Excel? The need for better transparency for members to understand the value of the firm’s programs?
Our firm has been actively reviewing its various operations recently to enhance efficiency and effectiveness. The administration of our carry and co-invest plans has been highly manual and owned by one person for a number of years with little transparency to the employee participants.
Our motivations fell into ‘all-of-the-above’ that you mentioned in your examples. As our business has grown over the years with additional plans, the ability to maintain clean, consistent record-keeping has been outlived, so it made sense to look for a central solution that will also provide participants the opportunity to access plan information on a regular basis in a self-service way.
What challenges did you face in converting to the digital environment?
I would say that the most significant challenge in migrating was going through all the historical transactions maintained in different Excel-based files for active plans to report them to the new platform. By having to explain the data to third parties, it forced us to more carefully explain the way certain transactions were treated since the record-keeping may have historically been more informal when completed in-house.
Have there been any surprises, positive or negative, in the transition?
Well, I think the most significant surprise has been the amount of time it has taken to make our way through all of the data and make sure it is reported accurately in the new system platform. Our initial assessment was that we had all the transactional data available and could fairly easily send it over to the project team. We certainly were able to send all the data over in short order, but there ended up being lots more back-and-forth than we initially anticipated. At the end of the day, it all came together, so the process was well worth it in my opinion.
What would you advise your peers regarding the digitization process?
Following on my point above, be mindful of your time horizon. The timespan from beginning to end will always be greater than originally anticipated.