2015 Forecast: Data Management Improvements Will Be Slow

As 2014 drew to a close, Inside Reference Data took some time to ask respected data management operations executives, both at financial firms and the service providers who work with those firms, what they see as the likely trends for this new year.

Several of our interviewees cited BCBS 239, the European risk data aggregation guidelines that require regular stress tests in which financial firms determine if their capital reserves can pass muster in a crisis (the US equivalent is CCAR, the Comprehensive Capital Analysis and Review procedures).

Overall, those responding described ways that incremental changes in data management are more likely to occur in 2015.

ANZ Institutional Bank's Mark Bands, responding to our question about what new technology will make a mark on reference data operations, said the focus will be on maturing existing capabilities to reach their full potential. BNP Paribas' Vincent Benita said the realization of the value of data, more than any technology, will change the reference data landscape. By that, he meant firms having greater appreciation of the licensing potential of their data. Thomson Reuters' Tim Lind also pointed to maturing of data management infrastructure, as opposed to "breakthrough innovations." And Rimes Technologies' Steve Cheng takes this further, stating that no specific new technology will affect reference data in 2015.

That doesn't necessarily mean nothing of any interest will happen. Making data management technology more mature and more capable requires work to integrate data sources, devise data strategies and update and enhance data systems.

Could application programming interfaces (APIs) be the smartest or most effective option, given the need to improve the sophistication of data management systems, adding and upgrading their capabilities? Eagle Investment Systems' Paul McInnis said he sees more usage of APIs happening. Or will cloud-based services prove more popular, as GoldenSource's John Eley said; or big data technology, as BNP Paribas' Vincent Benita noted? Cloud resources could be smoother at the task of obtaining all available data, including unstructured data and social sentiment data that Eley and Lind cited as important.

The bottom line in all of this could be managing expectations, whether it's those of regulators, as HSBC's Chris Johnson said, or data consumers' expectations for what systems and services can accomplish. While the past year has seen considerable progress, particularly with legal entity identifiers and elevating data issues to the boardroom level, as those who responded to our trend questions did attest, 2015 is likely to be dominated by figuring out the nuts and bolts of data operations that need to change to carry out grander plans.

The series of interviews began appearing December 17 and will continue daily through the end of this year. Inside Reference Data wishes our readers a happy holidays and new year. This column will return in 2015.