Achieving Investment Excellence

CHAPTER 7Implementing the Investment Strategy

Key Take Aways

Implementation puts plans and strategies in action in order to reach goals. Without implementation, a plan will sit forgotten; implementation means making the pension fund's plans happen.¹ Implementation follows after drafting the investment policy, where objectives for changes in asset categories, investment styles, managers, and the manner of oversight are further specified. This involves a budget that covers the operating time horizon, which is often between one and three years. How implementation takes place is critical to a fund's success, addressing the “who,” “where,” “when,” and “how” of operating in order to reach the desired goals and objectives. Implementing the investment strategy is a matter of assessing resources, quantifying objectives and then combining them into a flexible plan.

ORGANIZING THE IMPLEMENTATION

For a board of trustees, implementation is a key area of policymaking and its importance is obvious: if the board has a clear idea of what needs to be done but the organization charged with implementing the investment plan lacks the will or capacity to actually do it, little will be accomplished. In order to assess progress towards achieving your goals, you need to be clear about what you are trying to achieve and how you are trying to achieve it; that is, your objectives and the activities ...