Group

Transition Manager Selection

Deciding on when and how to transition shouldn’t be left to chance.

All transition managers are not born equal. Given the small number of providers available, you might be forgiven for thinking that the services they provide are broadly uniform. This couldn’t be further from the truth. Our Survey of transition managers in 2017 (refreshed in 2020), showed differing skills, experience, coverage and even conflicts. In picking a transition manager we typically review:

Panel Review / Selection

For most Institutional investors, forming a panel of providers allows quick an easy selection, without the need for formal procurement. Whilst panel’s provide ease of selection, its important providers remain appropriate and fit for purpose. This can be achieved by:

  • Periodic Review – this-tests the base-line requirements for each transition provider to ensure the service level deliverables as contracted can be sufficiently provided.
  • Panel Selection – this can be a full or partial RFP across all providers, which tests all aspects of the transition service deliverables. In considering the addition of a provider to a panel or the formation of a panel, it is key to consider a mix of specialisms, as opposed to selecting three good all-rounders.

Event Selection

The choice of transition manager is often determined by a competition of estimate of costs. Lowest tends to win. This works where estimates are always aligned with results, but sadly that isn’t the case. Determining the best provider for the job requires:

  • Understanding of individual transition providers capabilities and weaknesses
  • Understanding and experience of required transition solution
  • Independent assessment of costs and risks (removing “low balls”)
  • Efficient process for selection (as below)

USEFUL GUIDE

UK Transition Management Review

There are now only seven firms offering transition management services to clients in the UK and Europe. MJ Hudson has undertaken a detailed survey of all providers to assess the relative strengths and weaknesses of each firm.

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