Is it Really Possible to do More with Less? Linedata Says “Yes!”

The financial services industry has changed beyond recognition. Following the financial and economic crash of 2008,we have seen the rise of iron-clad regulation and the need to prove and justify every single decision. Technology is often seen as the enabler, both for the regulators and also for the firms that need to comply. Technology is also the key to operating faster, smarter and more profitably. But,given the pace of change, the traditional model of purchasing and deploying software is not enough. Investment management firms need not only best of breed software, but also the assistance to flexibly deploy, manage, upgrade and add a variety of peripheral services on top of that software.

Making Better IT Decisions
In the new world of financial technology, faced with shrinking budgets and resources, licensing software is not enough. Investment managers need to look at the "Technology Services" model, which offers several software applications together with data and infrastructure. It is supplemented by technical resources and services to ensure painless implementation and adoption of the solution. Some technology providers can now offer more than just software, and can often service the business needs better than the firm's own IT and operations team, and this can be a key competitive differentiator.

Technology has become crucial to every facet of the financial services industry. Now, with increasing regulation, resourcing constraints, slashed budgets, increased technological complexity, and potential implementation risk, firms are facing a difficult challenge: How do you achieve the dichotomy of needing better technology but having fewer resources to throw at it? Traditionally, a firm looking to revamp its procedures would implement an appropriate system following a rigorous vendor selection procedure, often lasting several months. However, the evolving nature of the industry means that firms can no longer operate within the same timescales. Regulations and market conditions are changing so rapidly that to remain competitive, firms must be thinking about implementation in weeks, not months. Purchasing new software and embarking on yet another major IT project in order to comply can be a lengthy and expensive process. This spiral of technology implementations is unsustainable in today's climate.

The Alternative?
Let's take an investment management firm looking to streamline its compliance services as an example. Options could include everything from hosting the application, writing and deploying rules of an aggregate of these services to create a full SaaS "compliance as a service", in which the compliance team simply logs into a secure website that displays their daily compliance reports, can be leased by the investment manager, thus doing away with the need for software installation, servers and maintenance.
The compliance service requires the investment firm's daily holdings data, but otherwise bundles the application functionality (running the rules, displaying the results, facilitating breach management) with market data, in a hosted environment. Software upgrades and rules updates happen behind the scenes, and the technology service provider uses compliance experts to set up new accounts and maintain the rules.
The investment management firm has thus streamlined its compliance-
management process, but has done so with a defined service fee based on business usage rather than license fees and upgrade services. The service provider's technical experts manage the system while its compliance experts handle the guideline review and configuration.
The investment management firm is responsible for signoff, breach management and oversight. With the ongoing compliance advisory services offered by the technology service provider, guidelines remain updated and well-documented through interactive reporting of actual operational rules.

The Evolving Technology Landscape
Linedata continues to be the leader in developing solutions to meet the challenges of its clients. Delivering the technology and services that complements and extends firms' exisitng workflows and operations, Linedata makes it possible for firms to do more with less. With access to a rock-solid operational infrastructure, clients know they are receiving the latest application functionality and the service expertise which enables them to focus solely on their investment decisions and trading.

“With increasing regulation, resourcing constraints, slashed budgets, increased technological complexity, and potential implementation risk, firms are facing a difficult challenge: Howdo you achieve the dichotomy of needing better technology but having fewer resources to throw at it?”

Gavin Little-Gill is managing director of Linedata North America.