State Street Research Claims the Lines Between Front- and Back-office Data are Blurring

A survey of over 900 buy-side organizations shows back-office data being used for front-office commercial priorities, while a surprisingly small percentage see GenAI adding value to the back-office both now and in the future. Back-office data is increasingly moving beyond its core purposes and being used to support commercial front-office functions such as investment strategy and distribution by a substantial proportion of institutions, State Street has concluded from a piece of far-reaching research. In a survey of 920 asset managers, asset owners, wealth managers, and insurers across North America, Europe, the UK, APAC, the Middle East, and Latin America, State Street found that nearly one-third (32%) of respondents are prioritizing the use of back-office data to generate competitor intelligence and market insights.  Firms highly satisfied with their custodians are significantly more likely to leverage this data for front-office priorities (74% vs 5%).  Another data point showed that institutions are significantly more likely to have or be implementing a holistic data strategy across their front-, middle- and back-office-data operations than individually within those areas. A difference between the back- and front-office with regards to data was seen in their use of GenAI however.  The research discovered that respondents were seeing less value in using GenAI for current back-office activities while expectations were also low for the future. Across back-office activities, only 20 to 30 percent reported that GenAl was currently adding value in specific activities. Compared to the front-office, there appeared to be few areas where GenAl stood out as already adding value. One-third of respondents in EMEA and APAC foresee GenAl improving internal operations and vendor relationships, and one-third in the Americas identify benefits from delivering data and reporting to consumers.