Investment management firms worldwide are having to cope with rapidly increasing volumes of data, not least when it comes to highly complex index data and benchmarks. Getting the management and governance of this data right is absolutely critical both to avoid breaching an ever growing list of regulations, but also to ensure that the strategic decisions made by investment managers are the best ones for their clients.
Without a data management team of the right size, staffed by people with the right skills and adequately funded, errors will inevitably arise and the quality of data available to the front- and mid-office functions will quickly deteriorate. Moreover, it will become increasingly difficult for such firms to guarantee they are using the best possible data available to reach their decisions.
This issue has been back in the news recently. New industry figures reveal that just 11 percent of investment managers believe data is being used well for strategic decision making within their firms, while 27 percent state their firm loses business because their intelligence and use of data is not up to scratch.
RIMES’ own 2016 Buy-Side Survey also highlights the growing awareness amongst asset managers that effective management of their data is essential to business success: 68 percent cite data quality as their core priority; closely followed by the 63 percent of respondents that cite data governance. Crucially 60 percent of respondents admit that data governance remains a work in progress.
The challenge facing investment management firms is therefore clear: put in place processes, technology and skills that enable timely access to all relevant, high-quality data as and when required. However, not only is the scale of this challenge daunting, but with the costs of data benchmarks on the rise, it is one that will become increasingly expensive.
One way of solving the data management challenge in a cost effective way, is to partner with managed data service providers such as RIMES. These organizations are data specialists and have the capabilities and skills needed to deliver timely data immediately to wherever it is needed within the firm.
Through such customized services the volume and complexity of data is no longer an issue, as the managed service provider operates at scale, providing the investment firm with all necessary indices and benchmark data. Moreover, this data is continually monitored for errors, so investment managers can rest assured that the intelligence they use for strategic decision making is not only correct, but the very best available.
Investment managers are not data experts. They simply want high-quality, complete and up-to-date data that allows them to do their jobs to the best of their abilities. Managed data services allow investment managers to do just that, while lowering the total cost of their firms’ data estates. The result is a more competitive operation and better results for clients.
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