Man Group Plc

Case Studies

Man Group Plc

Target Operating Model Design and Strategic Sourcing Strategy

Man is a world-leading alternative investment management business. It has expertise in a wide range of investment styles including managed futures, equity, credit and convertibles, emerging markets, global macro and multi-manager, combined with powerful product structuring, distribution and client service capabilities.

The original business was founded in 1783. Today, Man Group plc is listed on the London Stock Exchange and is a member of the FTSE 250 Index with a market capitalisation of around £1.5 billion.

Business Challenge

Prior to working with Knadel in 2010, Man’s operating model was complex, bespoke and only partially outsourced. Furthermore the outsourced components involved the appointment of multiple smaller service providers lacking in service level agreements and a robust governance framework. Management initiated a multi-stream programme in conjunction with Knadel to:

  • to define and implement a new target operating model (TOM) covering the manner in which Man utilised and interacted with its external providers
  • to select suitable strategic outsourcing partners 
  • to develop a more robust framework for oversight of outsourced arrangements for Man and the Funds

The scope of this work extended to organisation, process, technology, services and data.  The key objectives were to move Man to a best of breed model whilst delivering significant cost reductions and providing a scalable platform for future development.   

Solution Approach

Knadel provided a specialist consultancy team to support the Man management team, with an appropriate blend of industry and outsourcing knowledge to perform this assignment. The team were based onsite at Man and engaged significantly within the business as well as externally with service providers.

 The TOM design incorporated a number of client specific requirements including handling a wide range of complex products together with unique client technology requirements. Knadel contributed significantly to the successful management of stakeholder requirements. Implementation plans were designed to minimise impact on business as usual operations, especially where the impact could potentially be felt at a client-facing level, for example Distribution and Client Services.

 Knadel worked with Man to undertake a large-scale exercise to identify and provide a recommendation on selection of suitable strategic service partners. From an initial short-list, two suppliers were recommended and subsequently Knadel performed detailed rate card analysis as well as due diligence and negotiation of commercial and legal terms for both in support of the Man selection process.

Knadel Value

Knadel were able to provide a team with a significant amount of industry and outsourcing experience, who quickly understood the client’s business model and specific complexities of it. This blend of experience, combined with client-specific knowledge, allowed the team to provide a tailored solution incorporating industry best practice and delivering to client requirements on time and within budget.

Outcome and Business Benefit

  • Two strategic service providers were selected and appointed allowing the successful outsourcing of all in-scope services.
  • The core rate card negotiations led by Knadel allowed Man and the in scope funds to take advantage of the economies of scale, both internally and externally.
  • The selection of two service providers enabled Man to benefit from the relevant strengths of each across its product range, whilst mitigating counterparty risk.  
  • The recommendations  surrounding a proposed TOM led to the development of a more standardised operational model, which when aligned to the GLG operating model led to developing a more scalable business model.

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