Looking for Excel in All the Wrong Places

Take reconciliation, for example. I had a discussion with a software vendor last week who said that millions can be lost inside single businesses due to discrepancies with invoices. Granted, their company now markets software to handle this, so there's an angle in presenting the problem as acute, but it's not the first time that I've heard something like this and it won't be the last, I'm sure. Reliance on manual processes is a dangerous game, particularly when rules and workflow-based systems can so easily marry up values to identify which ones match and which ones don't.

Then there's Excel. Many argue, quite rightly, that the Microsoft bête noire of office workers everywhere can do this. It can. But then it can't pass exceptions onto specific persons for analysis, or use logarithms among multiple documents and values to match to correct numbers, or automatically generate templates, invoices, correction notices and other areas on its own. You need software for that, and realistically, in today's environment, you need automation.

It's not just reconciliation, of course. How many firms still use fax machines to send through confirmations and other essential material? And how many of those are delayed, unnecessarily, when they could easily be generated by a computer program? Straight-through processing (STP), which in vendor speak can sometimes mean a full suite of their programs rather than linked systems, is still a topic worthy of discussion, even if those discussions are seemingly interminable at times.

A lot of this is on the buy side of course, but it definitely affects the sell side as well. The old adage rings true that the buy side has the money and the sell side has the technology, but in modern intertwined markets, that isn't workable. Brokers need connectivity to their clients just as much as markets for this reason; it prevents leakage. Given the pressures on cost bases at the moment, shaving thousands off operational expenditure which are unnecessarily on balance sheets is a golden egg.

Other areas also benefit from enhanced mechanization, like compliance. Even at its simplest level, checking what's reported against internal ledgers and other systems, all linked in a central technological hub, can easily help to make the life of rogue traders and others harder.

The old adage rings true that the buy side has the money and the sell side has the technology, but in modern intertwined markets, that isn't workable.

Perhaps the days of high-profile tech installations and mass proprietary development are waning, but dismissing technology in favor of other areas is false economy. Our society as a whole is powered by it, and the financial services sector in particular lives and breathes off the back of it. Getting ahead of the technology game now will reap dividends in the future.