In the first article of our Operational Edge series, we explored how leading wealth management firms are transforming operations from back-office function into a source of competitive advantage. We introduced three pillars that support this Operational Edge: data as a strategic asset, streamlined workflows, and scalable technology infrastructure.
This article explores the first of those pillars: data.
As firms invest in automation, AI-enabled capabilities, and increasingly sophisticated technology ecosystems, many are discovering that their ability to scale depends less on adding new tools and more on creating trusted, unified, and accessible information. The firms gaining the greatest operational advantage are building connected data environments that reduce complexity, improve decision-making, and help technology investments deliver greater value.
The challenge is becoming more urgent
Recent industry research found that advisors spend just 7% of their time on business development activities that drive growth.1 The remaining time is consumed by client service, portfolio management, and operational responsibilities, underscoring the need for technology and data strategies that help firms operate more efficiently as they scale.
At the same time, 24% of advisors say disconnected technology is their biggest technology challenge. 2 As firms look to support more clients, investment products, and technology platforms without increasing headcount, fragmented systems can create operational friction that limits efficiency and growth.
Demand for alternatives continues to grow, magnifying the data challenge. According to iCapital’s 2026 Global Advisor Survey, 89% of advisors plan to maintain or increase allocations to alternatives3, and the share planning to increase allocations nearly tripled year over year.
As portfolios become more sophisticated, firms must manage increasing volumes of data across investment, reporting, servicing, and client-facing workflows. Alternative investments introduce additional layers of complexity, including fund- and vehicle-level reporting, capital activity tracking, document management, performance calculations, and data flowing across custodians, reporting platforms, and advisor technology systems.
Data as a strategic asset
In our first article, we highlighted that firms with an Operational Edge treat data as a strategic asset rather than simply an operational byproduct. High-quality, accessible data improves decision-making, increases efficiency, and provides a clearer view of clients, portfolios, and business performance.
Today, wealth management firms operate across a growing ecosystem of custodians, reporting platforms, CRM systems, document repositories, risk management tools, and other specialized technologies. Each plays an important role, but many maintain their own version of client, account, fund, and position data. Advisors increasingly rely on information from multiple sources to make decisions.
As technology ecosystems expand, keeping information consistent across systems becomes more challenging. Operations teams often spend significant time maintaining information across multiple systems, reconciling discrepancies between sources, determining which data is correct when records conflict, and meeting increasingly sophisticated advisor and client reporting expectations.
The challenge becomes even greater as firms look to scale the use of data across advisors, operations, compliance, and leadership teams. For firms seeking to gain an Operational Edge, the objective is not simply collecting more data. It is creating a shared, reliable foundation for information across the organization.
Building a unified data environment
Leading firms increasingly view information as an enterprise-wide resource rather than something managed within individual systems. Rather than managing information separately within each application, they are building data foundations that improve consistency, strengthen confidence in information, and make it easier for data to support business processes across the organization. These efforts may include consolidating information into centralized data environments, establishing a single source of truth for key datasets, and creating governance frameworks that define how information is maintained and shared across the business.
A connected data foundation can help firms:
- Improve data quality and consistency
- Reduce manual reconciliation
- Enable automation and AI initiatives
Information only needs to be validated once and can then support reporting, compliance, advisor workflows, analytics, automation, and client experiences. Rather than maintaining multiple versions of the truth across disconnected systems, firms can operate from a shared source of information.
Why governance matters
Connectivity alone is not enough. Firms must also ensure data is governed consistently across systems and workflows.
Effective data governance helps establish common definitions, maintain quality standards, and ensure information remains reliable as it moves across the organization. It creates the consistency required for automation, reporting, compliance oversight, and analytics.
Without governance, firms risk duplicative records, inconsistent reporting, and conflicting interpretations of the same information. With it, firms can operate with greater confidence that people and technology systems are working from consistent information.
The importance of governance extends beyond operational efficiency. Recent research found that 62% of organizations believe a lack of data governance is a roadblock to AI initiatives.4
Advisors continue to demand better reporting, stronger analytics, and greater transparency into increasingly complex portfolios. Meeting those expectations requires reliable, connected data.
Together, connectivity and governance create the foundation required to scale operations, support technology investments, and enable future innovation.
AI starts with data
Artificial intelligence has quickly become a strategic priority across wealth management. Firms are evaluating how AI can automate tasks, improve productivity, accelerate decision-making, and enhance client experiences.
However, AI is only as effective as the data that powers it.
Many firms are discovering that AI challenges are often data challenges in disguise. While AI has the potential to improve productivity, streamline operations, and return valuable time to advisors and operations teams, fragmented technology environments can significantly limit its effectiveness. As organizations move from AI experimentation toward operational deployment, data readiness becomes a business priority rather than a future consideration.
Organizations with connected and standardized data are better positioned to automate manual tasks, surface actionable insights, identify anomalies, streamline workflows, and support increasingly intelligent advisor and operations experiences. When information exists across disconnected systems with inconsistent definitions, duplicate records, or conflicting data, AI outputs become less reliable and more difficult to trust. In other words, AI amplifies the quality of the underlying operating environment. Firms with disconnected data often automate complexity. Firms with connected data automate efficiency.
Advisor demand for advanced capabilities continues to grow. iCapital’s 2026 Global Advisor Survey found increasing interest in AI-assisted insights and anomaly detection, alongside growing demand for risk analytics, reporting, implementation technology, and operational support as firms work to scale alternatives across their practices. Meeting those expectations requires a trusted information architecture capable of supporting intelligent workflows with high-quality, governed information.
From this perspective, data quality is no longer simply an operational concern. It has become a strategic requirement for firms seeking to build and sustain an Operational Edge.
How iCapital is investing
At iCapital, we believe data is becoming one of the most important drivers of operational advantage in wealth management.
That’s why we’re investing in the core infrastructure needed to create greater consistency, interoperability, and scalability across our platform. Key initiatives include a unified position store, centralized entity master, and fund master architecture designed to improve data consistency and connectivity across workflows. Together, these investments are intended to create a common information foundation that can support reporting, analytics, integrations, advisor workflows, operational processes, and future AI-enabled capabilities.
We extend this same philosophy through our Consolidated Reporting services, helping firms create a more unified view of client assets and investment activity across accounts, custodians, and investment vehicles. By bringing together disparate data sources into a consistent reporting framework, firms can gain greater visibility into portfolios, reduce manual effort, and establish a stronger foundation for decision-making and scale.
By reducing fragmentation and improving interoperability across systems, these investments help firms spend less time reconciling information and more time delivering value to advisors and clients.
Looking ahead
A unified information strategy sits at the center of Operational Edge. As wealth management firms seek to scale alternatives programs, support more sophisticated client needs, and leverage AI-enabled capabilities, connected and governed data becomes increasingly important to operational success.
Without trusted and governed data, workflows become harder to automate, technology ecosystems become more difficult to scale, and AI initiatives become harder to operationalize.
The firms that build the greatest Operational Edge will not simply be those that implement the most technology. They will be the firms that create a trusted information foundation capable of connecting systems, supporting decisions, enabling automation, and powering AI at scale. For many organizations, the path to operational transformation does not begin with artificial intelligence. It begins with data.
In our next article, we’ll explore how streamlined workflows can reduce friction and create more capacity for higher-value work. Connected data is no longer just an operational requirement.
It is a competitive advantage.
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iCapital sponsored research completed first half 2026. A third-party research firm conducted a telephone survey of 870 financial professionals across a mix of channels, including private wealth, national and regional broker dealers (BDs), independent BDs and RIAs. We had 870 respondents across the U.S., Europe, Middle East, and APAC, covering fifteen countries. Additional information available upon request
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