The credit crisis brought the need for effective data management to the forefront, as data management and integration have become crucial for financial institutions to understand and report on risk exposure quickly and correctly. While data management has focused heavily on acquisition and normalization, the challenges of delivering quality data to the right users and applications in a timely manner continue to plague firmsâ resources, time to market, and ability to meet business objectives. Here are some of the key findings of the report:
â¢ Firms will spend $1.76 billion on data integration alone in 2010, not including point-to-point data integration which can be another large part of a firmâs budget.
â¢ Large sell-side firms report data management staff of more than 50 people supporting upwards of 100 applications, while medium and smaller firms have staffs in the 5-15 person range supporting from 5 to 15 applications.
â¢ Many application implementations fall short of expectations due to lack of or poor quality data, resulting in the need to develop workarounds and other shortcuts, or pulling back the scope of the project.
Fritz McCormick, senior analyst at Aite Group and author of the paper, said, âData integration is a key step in successful application implementations and data management projects, enabling business applications to realize their full potential in supporting key business drivers and objectives. However, many firmsâ models are difficult to maintain and virtually impossible to scale. Effective data integration has a significant impact on the operational integrity of the firm and its ability to mitigate errors in the trading process.â
Phil Lynch, Asset Controlâs president and chief executive officer, said, âFirms can overcome data integration challenges by implementing best practices, such as developing strong partnerships with business users, establishing realistic service-level expectations, and implementing a response mechanism that audits data usage within the application. Data integration should be part of a firmâs decision making and analysis at the start of the project to minimize the substantial cost of integration.â