Building for Better Service

Richard Wilson, Newedge: Our top priority is completing the integration. There are some weeks left to complete it, but we expect that to be totally finished in 2009 and we are on schedule. We have a number of areas of development globally: in the technology space, creating clearing capacity and industrialization; and also around our corporate functions, delivering market-standard technology around finance and risk. One other key focus is data management technology where we see our ability to deliver a multi-asset data service as a key element of the Newedge platform.

DWT: Could you give us more details about the integration between Fimat and Calyon Financial?

Wilson: At this stage, we have two or three technology projects in progress, delivering the remaining parts of the integration from a technology platform standpoint. The main work we are doing is migrating existing activity onto the already completed global platform. So the majority of the technology development has been done. We will see a number of visible changes in the near term. The new portal service from Newedge, called Pulse, will become available in the summer, and is targeted at providing the best quality service to end customers. This is all about client data exchange: statements, files, reports. It is a global service but is intended to be a more personalized service to customers so we can address specific needs.

DWT: What were the main challenges of the integration process?

Wilson: The main challenges were speed and complexity-for example, working on a deadline to combine offices and move datacenters simultaneously during the largest period of market volatility in history. We moved or closed a substantial number of datacenters globally, going from 51 to 33 in 12 months. We moved a significant part of the organization between buildings at the same time. All of these were completed last year.

DWT: Are you going to retire many systems as a result of the integration?

Wilson: There are some significant retirements that are already reasonably advanced-for example, the number of datacenters. And we are now tracking that retirement process. The nature of the beast is that you don't retire a system until the last person has left the room and turned the light off. Then you remove the systems. That process will continue through the end of the year as we look to retire platforms and then switch the underlying infrastructure off.

DWT: Are you planning to reduce headcount?

Wilson: Clearly, the integration process means that we have had an expanded workforce during that period. We are now at the tail end of integration and going through the process of getting back to normal.

DWT: What products and services can we expect from Newedge in the near future?

Wilson: We continue to expand the number of markets we offer, like the ELX Futures Exchange and Liffe credit default swaps (CDSes). We are a member of more than 80 exchanges and that is an ongoing process. We examine the depth of a prospective market, the market access requirements and then the time to market. We are working on developing services in order routing and algorithmic trading, which will be delivered in due course. More generally, Newedge has moved from being a pure derivatives house to being a multi-asset broker and our technology focus reflects this.

DWT: How has the emergence of multilateral trading facilities (MTFs) in Europe affected your business?

Wilson: From a technology standpoint, an MTF is just another marketplace. My view on those is to not treat them any differently from any other. We sit at our exchange committee, decide which markets we will support and, as a technology group, we then implement the plan to onboard or enable that market.

DWT: As a global CIO, how do you prioritize technology projects?

Wilson: We sit down with the Newedge business leaders around the world and, based on opportunities, ideas or regulatory drivers, we make investment proposals within our global project governance structure. Then, we sit down with the senior management and the CEO periodically to decide on our priorities and how we are going to invest our technology dollars. We meet twice a month to review progress on those projects and evaluate any new investments.

DWT: What comes next for Newedge?

Wilson: After integration comes rationalization. The next mile will involve selective development, but now our principal goal is to focus on the basics, optimize the assets that we have and decommission any remaining non-required systems. Beyond that, the job is to provide the best quality of technology service to our customers by delivering our global strengths through a leading-edge platform tuned to their individual needs.