Asset management has a habit of talking about scale as if it were an unqualified good. Bigger platforms, broader capability sets and more centralisation can all sound sensible on paper. Yet scale often creates precisely what it claims to solve: distance from decision-making, accountability and, in the worst cases, the client.
How do you preserve the sharpness and conviction of specialist investment teams while building something larger, more coherent and more durable?
For me, the answer is culture. Not the vacuous words plastered on a wall kind, or the sets of values carefully rehearsed for away days. I mean culture in its most practical form. The repeated habits, behaviours and interactions that shape how people make decisions when nobody is forcing them to.
In a well-built boutique model, culture acts as a form of operating infrastructure.
Culture compounds through habits
We understand instinctively that marginal gains matter. Incremental improvements in judgement, process and implementation can add up meaningfully over time.
Culture works in much the same way. Rarely is it transformed by one grand initiative. More often, it is shaped by dozens of small, repeated acts:
- a better hiring conversation,
- a clearer piece of feedback,
- a more thoughtful question in a governance meeting,
- an early intervention when tensions begin to surface and a leader taking time to understand what is really driving behaviour rather than reacting only to the visible symptom.
Together, these determine how a business behaves under pressure.
Larger organisations often respond to growth by adding governance, reporting and bureaucracy. The intention is usually sensible and entirely understandable; the outcome is invariably not.
People spend so much time proving they are doing their jobs, it can impact on the time and energy they have to actually do them. Oversight becomes performative.
Bureaucracies are extraordinarily good at counting paper clips – tracking, measuring and optimising whatever can be made visible. What they struggle to do is motivate people. The things that drive performance in an investment organisation are conviction, curiosity, the willingness to stay late on a problem and the quality of a conversation. But they are not legible to a compliance dashboard.
The more you manage people as measurable units of output, the less they behave like the professionals you hired.
Firms should be less interested in backward-looking box-ticking than in behaviour. Are people still thinking the way they said they would think? Are they still making decisions consistent with the philosophy they built their track record on? Are they still showing the conviction and discipline clients were promised? The answers reveal far more than whether another document has been (mindlessly) completed.
Value people, not paper clips
You can count paper clips accurately. You can track outputs, measure completion rates, document performance reviews. None of that tells you whether someone is genuinely engaged, or just going through the motions convincingly enough to avoid notice.
Boutique environments are full of distinctive personalities – people who could easily sit somewhere more formulaic and choose not to. Managing them as interchangeable is not just ineffective; it is a category error.
Looking outside the world of asset management is essential. I have become far more aware of the interaction between physiology, focus and language: how you carry yourself, what you pay attention to and the words you use to frame events. Strip away the self-help packaging and there is a serious point underneath. Good leaders communicate through tone, posture, timing, presence and the questions they ask. Small changes in how you show up can create disproportionately large changes in how a team responds.
Walk into a meeting distracted, defensive and looking for faults, and you will tend to get caution, politics and self-protection in return. A small change in physiology can shift the room. A small change in language can determine whether feedback feels threatening or developmental. A small change in attention can mean spotting a tension early rather than allowing it to calcify into mistrust.
All this takes time. It also requires empathy and a willingness to address the ‘micro’ things before they become structural problems. Too many firms still avoid honest feedback until it is too late or deliver it in ways that diminish rather than develop. Yet feedback is one of the purest examples of cultural marginal gains. Done properly; it builds trust, sharpens standards, and helps people grow. Done poorly, or avoided altogether; it stores up frustration for later.
The same is true of hiring. So much of cultural scaling is won or lost before somebody joins. Alignment of expectations sounds mundane, but it’s one of the great hidden sources of compound advantage. What does the candidate think they are walking into? What do we think they are walking into? If those things are aligned early, trust starts earlier. If they are not, the organisation and the individuals pay for it later in frustration and wasted energy.
Trust as a multiplier
Trust, in the end, is a real multiplier of scale. Without it, organisations create unnecessary friction. With it, a leaner and more adaptable model becomes possible. Teams move more quickly because they understand the principles they are working within, external partners can act like a genuine extension of the team, and distinctive specialists can retain their edge.
In a more crowded and cost-conscious asset management landscape, the firms that survive and thrive will not necessarily be those that add the most capability the fastest. They will be the ones that know what they stand for, where they can genuinely add value and how to scale without losing coherence. Culture is what makes that possible.
Ultimately, marginal gains philosophy shouldn’t be confined to the investment floor. It belongs in leadership, in hiring, in feedback, in trust, and in everyday habits that shape how an organisation behaves. Get those small things right often enough, and over time they amount to something very significant indeed.
By Apiramy Jeyarajah, Chief Commercial Officer at Nedgroup Investments
