Recent years of rapid regulatory change have uncovered massive vulnerabilities in financial services institutions across the globe. Levels of institutional risk; gaps in transactions monitoring, compliance, and reconciliation; and the ineffective use of antiquated systems are now exposed to and scrutinized by regulators, shareholders, and customers more than ever before.</p> Moreover, exponential growth of the three Vs of data – Velocity, Volume, and Variety – is putting more strain on institutions as they try to process data about customers, operations, business partners, and markets.</p> For many institutions, a strong foundation for data management can help meet the demands of an environment that requires more analysis, investigation, assurance, and agility.</p> Velocity - expected speed of transaction monitoring and business reconciliation response time has accelerated. Client expectations for rapid onboarding have grown along with financial managers who are eager to quickly expand portfolios</li> Volume - sheer amount of financial transactions and volume of regulatory-based business rules has exploded</li> Variety – unstructured document-based data, customer attributes (KYC/AML) that require monitoring, and 3rd party macro-economic data that feed stress testing models all place different demands on systems to capture, catalog, and convert into useful data</li> </ul>How can institutions shore up their data management foundation? For starters, organizations need to assess weaknesses across the enterprise information supply chain.</p> A cohesive, integrated information supply chain streamlines data consumption across the entreprise</em> </p> Evolution to a mature data management structure requires a balance of quick-wins that add value to the organization and longer-term foundational changes to sustain technology agility.</p> Questions to consider to pinpoint opportunities to improve:</p> Are there paper-based processes that need to be digitized to formalize structured and unstructured data?</li> Does product and customer information reside in silos, preventing easy data integration?</li> Can business rules be lifted out of the technology into flexible and adaptable business rules engines, with rules applied on a real-time, transactional basis?</li> Do workflows integrate and trace actions across operations, so data is disseminated quickly and transactional history is easily revealed?</li> And, the holy grail of measures – does your data efficiently delivery business insight, allowing leadership to drive new sources of revenue and mitigate risk across business units and asset portfolios?</li> </ul>As focal points for improvement are identified, the next step is to decide the best solution for your unique situation. Given finite resources, institutions typically are choosing the path that solves their most significant source of pain. Two common approaches for improving the enterprise data foundation are:</p> Technology solutions that strengthen the data management foundation across functions. For example: Cloud infrastructure and application development models to improve IT agility</li> In-memory solutions to accelerate transactional processing</li> Rules engines to manage rapidly evolving business and regulatory requirements</li> </ul></li> Functionally-specific business applications: Collateral management solutions to improve compliance and optimize portfolio profitability</li> Stress testing and capitalization analytics for Dodd Frank compliance</li> Know your customer (KYC) reference models to accelerate client onboarding and Anti-Money Laundering monitoring</li> </ul></li> </ol>While institutions are solving similar challenges across the industry, each one approaches solutions from a unique set of strengths and gaps. Charting the right course toward developing a robust foundation for managing rapidly evolving demands on data will be key to long-term success and stability. Having the right partner who understands the complex data management challenges, has the pulse of evolving regulatory demands, and who has the capabilities to introduce transformational change will accelerate your journey and reduce risk.</p> Article contributed by NTT DATA, a top provider to financial institutions worldwide, possessing deep domain, technology and operations knowledge to help meet institutions’ growing risk and compliance objectives. Find out more at www.nttdata.com/americas</a></p> </p>