As Data Management Becomes More Challenging, the Buy Side Turns to Managed Data Services

Rimes Technologies brought together a group of industry members to discuss data management under Chatham House rules at a restaurant in midtown Manhattan this week.

The group, which included buy-side representatives working in custody, technology development, and risk management operations among other functions, touched on several topics related to data management, including reasons for and against adopting alternative data management models, such as managed data services.

New Demands, Higher Volume

One participant spoke to his firm’s decision to use managed data services for its index data ten years ago. The early move paid off, as customers are now constantly demanding more granularity and customization with their data.
The firm, however, wasn’t using managed data services for all of its data, although it was something the participant said his company was constantly revisiting.

“I imagine it’s going to be somewhat of a hybrid model,” the participant said. “I’m sure there’s going to be managed services required for some, and then I think there’s others where we’ll deal directly with the vendors themselves.”

Another participant spoke about the process of building an engine to centralize data from various sources followed by a business intelligence layer on top that would distribute the data to the various groups in the firm.

The problem is that demand for the various types of data seems to be never-ending.

“The needs of each individual department within the groups, and the consumption of that same data set, are so vast that it seems that we can’t meet all of the reporting requirements and the data set requirements,” the participant said. “We can’t fulfill those requirements as quickly as the users need them. The more we produce with these aggregated data sets, the more people need.”

Another participant piggybacked the point

“As fast as firms are trying to centralize, the usage and requirements of the data just seem to be spreading,” the participant said. “More different business processes require access to all the different types of data and the kind of new data sets, as well.”

C-Level Support

The discussion then turned to how to avoid being overwhelmed with dataset requests, something that seemed to be an issue across the board.
One participant said his firm put hard lines on the datasets, to give the firm time to make them more robust. Another suggested limiting the amount of options made available.

What all the participants did agree upon was the fact that if a new data governance program is to be effectively implemented, it has to be led by the firms’ executives.

“You need buy-in from the senior levels of the company to do it,” a participant said. “Small company, large company, whatever. If it’s the ground-level troops, if it’s the market-data folks that are championing governance, it’s never going to take off. You really need executive sponsorship to do it.”

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