Ernst & Young (EY) recently released the results of its 11th annual Global Hedge Fund and Investor Survey. Among other topics, the survey explored issues affecting operational efficiency, including headcount, fees, expense ratios, expense pass-throughs and passively managed funds; and the challenges of attracting, developing and retaining talent. The survey also explored steps fund managers can take to stay competitive in the evolving market. This article, the second in a two-part series, describes the survey’s key findings in these areas. The first article detailed the survey’s results concerning fund managers’ strategic priorities; investor allocation plans; offerings of non-traditional products by hedge fund managers; evolution of hedge funds’ front-office and investment functions; and key industry risks. For coverage of prior EY surveys, see “Hedge Fund Growth Priorities, Fee and Expense Climate, Prime Brokerage and Operational Matters” (Dec. 3, 2015); “Growth Areas for Hedge Fund Managers, Related Costs and Challenges, Operating Expenses and Cybersecurity” (Jan. 15, 2015); and “Trends in Asset Sourcing, Alternative Mutual Funds, Customized Solutions, Staffing, Administrator Shadowing, Expense Pass-Throughs and Outsourcing” (Dec. 5, 2013).