09.20.2011

Data Silos Likely to Persist

09.20.2011
Terry Flanagan

Product-centric data repositories are a fact of life.

Data silos exist in the form of vertical (e.g., by asset class) and horizontal (front, middle and back office), and they’re unlikely to go away soon.

“From an operational perspective, these silos may continue to persist,” Phil Lynch, CEO of Asset Control, told Markets Media.

“For example, the fixed income guy will always be the fixed income guy and that is not likely to change,” he said. “But this must be appropriately balanced with the need for firms to take a consolidated view across asset classes, regions and business units. Having a consolidated view of, for example, total exposure and risk on a pre and post trade basis has become vital from a regulatory and investor standpoint.”

Firms cannot do this from siloed pools of data and disparate systems as there is no element of centralized control.

“Integration, consolidation and scalability are now the watch words of the systems that govern the data management world,” said Lynch.

Regulatory reform is impacting the demand for data management products and services.

“Increasing calls for transparency and governance and the pure number of regulatory changes on the horizon are putting real pressure on the data management and governance functions,” Lynch said. “Data is now a strategic concern with a large number of touch points across the business, bringing with it requirements which are changing much more quickly than ever before. The need for the right data management product or service that can support a firm through this is absolutely vital.”

Data needs to be sponsored by C-level executives across the board. Senior management buy-in is absolutely vital; in today’s markets it cannot be avoided, he said.
Whether this manifests itself in a chief data officer is something that each firm must decide, but as long as each department and division use data in very different ways there is not a single enterprise wide approach to data that will succeed.

“Success in the capital markets used to come down to having the right people and having enough capital, but things have changed,” said Lynch. “Now, in addition to the right people and capital, you need the right data and the right technology. This is the winning combination and the only way firms will be successful today.”

Asset Control makes accurate information available to the people and processes that manage regulatory, credit, counterparty, market and price risk. Its solutions and flexible approach allow organizations to react efficiently and easily to rapidly changing and increasingly complex markets, and to develop the strategies and products that will increase revenues and create competitive advantage, according to Lynch.

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