Developing continuous improvement and automation in financial services operations

CA$700bn pension fund · Middle and back-office operations
Embedding Kaizen, Flow, and leadership of excellence in a highly pressured, critical environment

Themes:

Operational Excellence, Continuous Strategy

Context snapshot

Organisation: Global pension fund

Assets under management: ~CA$700bn

Domain: Middle and back-office operations

Environment: High volume, high risk, regulated

Strategic intent: Embed sustainable continuous improvement as a core operating capability alongside Technology modernisation

Executive tension

This CA$700bn pension fund operates in an environment of increasing transaction volumes, rising market volatility, and growing operational risk.

Like all Financial Services institutions, it faces sustained pressure to:

Automate and optimise operations
Reduce manual processing toward straight-through processing
Anticipate and prevent risk through better data, reduced operational exposure, and selective use of AI

As part of a major modernisation effort, the fund made a deliberate shift in intent.

Rather than relying on periodic transformation programmes, it chose to build resilience by embedding continuous improvement as a core operating capability — owned by leaders and teams, not external parties.

The expectation was clear:

Operations must continue to run reliably
While processes, skills, and Technology evolve continuously
Without repeated dependence on external consultants

Operations play a critical role:

Processing trades across multiple asset classes
Reporting consolidated positions and P&L to investment desks
Managing tracking, valuation, collateralisation, and custodianship
Operating safely within risk, compliance, and audit constraints

Yet this part of the organisation rarely receives sustained strategic attention.

Reframing the problem

This was not a tooling, automation, or capacity problem.

It was a resilience and leadership problem rooted in how improvement actually happens in high-risk Services environments.

Investment operations typically run with just enough capacity to meet daily demand. Any modernisation effort immediately competes with live work, leaving little headroom to improve. Manual work accumulates gradually, absorbed by people rather than simplified through standardisation.

The environment itself compounds the challenge:

Each asset class carries specific rules and exceptions
Errors have material financial and reputational consequences
Compliance and audit provide necessary — but heavy — guardrails

Under constant pressure, teams adapt locally:

Workarounds increase
Manual processing grows
Complexity is managed through heroics rather than system design

AI presents opportunity, but only if introduced with discipline. Without strong problem definition and operational ownership, it risks accelerating fragility rather than resilience.

What made this particularly difficult:

Consultants delivered technical solutions, but not lasting behavioural change
Traditional leadership coaching operated outside the context of real work
Rigid improvement methods proved too bureaucratic for a Services environment

What was needed was different:

Improvement embedded directly in day-to-day work
Leadership development grounded in operational reality
Practice first, training second
Gradual adoption through facilitated application

The objective was not to “roll out continuous improvement”, but to start improving immediately, reclaim time, and build confidence through results.

How we worked

1. Start from practice, not theory

The work began with real operational problems, not programmes.

Teams were supported to:

Identify issues in their own work
Use simple, pragmatic problem-solving structures (A3, Toyota Kata)
Focus on small, tangible improvements
Repeat continuously

Five- to ten-minute gains mattered. Repeated consistently, they restored meaningful capacity over time.

2. Treat standardisation as continuous work

Standardisation was not approached as one-off definition or enforcement.

Instead:

Standards were treated as evolving baselines
Teams defined, tested, and improved their own ways of working
Ownership replaced resistance

This reduced fragility while preserving local expertise.

3. Scale through leadership coherence

The work started with a small number of operational “lighthouse” teams.

In parallel:

The senior leadership team was coached as a team
System-level focus areas were introduced: flow, cross-team Kaizen, and operational strategy
A weekly leadership cadence was established and continuously adapted
Individual coaching supported team leaders and senior leaders

Each quarter:

New teams were onboarded
Earlier teams progressed toward sustainability
Direction and priorities were reviewed and adjusted

4. Build transparency and learning loops

Visualisation evolved to enable shared understanding of:

Kaizen activity
Flow of work
Performance and priorities

This reduced hidden work and strengthened alignment.

As the organisation increased its focus on AI adoption:

AI agents were introduced to support Kaizen practice
Guidance was embedded for structuring A3s and selecting problem-solving approaches
The baseline quality of problem definition improved, strengthening coaching conversations

Evidence of movement

The impact was cumulative rather than headline-grabbing — and more durable as a result.

Teams began identifying and resolving problems on a regular cadence. Improvements ranged from minutes saved per task to days removed from reporting cycles. In some areas, overtime was reduced while throughput improved.

As work became visible, waste surfaced and was addressed. For example, one team identified that a daily report was only required on a weekly basis — eliminating approximately 80% of the associated effort without increasing risk.

Quarter by quarter:

Adoption expanded
Maturity deepened
More systemic and cross-team problems were addressed

Collaboration and critical thinking increased. Psychological safety improved as teams gained a reliable structure to raise issues and challenge assumptions.

Leadership progressively reclaimed time and strengthened the strategic role of operations within the fund, shifting from firefighting toward shaping operational capability.

The work continues, with further evolution underway, including deeper cross-team Kaizen, expanded AI-enabled support, and continued refinement of the leadership operating model.