Firms budgeting for data management operations needs may also find that they "get what they pay for" in the current climate.
In Inside Reference Data’s most recent webcast, Building a Data Management Foundation, 36% of 92 attendees who responded to a question about how much their firms planned to spend on new data management initiatives said they planned to spend less than $1 million, and another 26% said they plan to spend less than $5 million. This is surprising, considering responses to another question in the webcast concerning readiness for the legal entity identifier (LEI) implementation, where less than half of those who responded had made some changes or extensive changes to prepare.
The adage “you get what you pay for” comes to mind again, as I wrote in the Editor’s Letter of our latest special report on corporate actions. And that maxim seems to be tied to data operations quite a lot lately—it’s also turned up in a recent issue of Bloomberg Businessweek, in coverage of potential cuts to the US federal government’s budget for its own essential economic data, including census and labor statistics.
It’s not the only place I’ve heard the phrase either. My wife loves to say it when I habitually reach for less expensive options when clothes shopping, or picking up household goods, or getting some new electronic gear. Inevitably the frayed ties, broken electric toothbrushes and cheaper MP3 players end up in the garbage and I go back to the malls or Amazon a little bit wiser.
Webcast poll results aside, there is some light at the end of the cost-cutting tunnel. As Sybase’s Neil McGovern noted in the program, some data initiatives may be getting their funding from project requests made by risk management or trading departments at firms, rather than designated data management budgeting.
Ironically, data professionals are probably the most aware of the need for greater spending. The LEI responses, not to mention the ongoing implementation saga itself, show they at least know they have to look at or reach decisions on some data management changes. And in another poll question, respondents largely said they expected to see benefits from LEI between now and five years from now at most. The question this raises: will they want to pay for what they will get?
Next week, London reporter Nicholas Hamilton will fill in with an Editor's View while I am on vacation.