We recently hosted some of our customers and industry experts at a RIMES Forum. The day’s discussions focused on issues around managed data services, with attendees adding weight to the idea that financial sector firms are increasingly looking for specialist support to help them mitigate the cost and complexity of data management.
During the day’s discussions, several key data management themes emerged:
- Managed services are reaching tipping point. Asset managers are increasingly aware of the possibilities of managed data services and increasingly willing to use them, particularly when it comes to tasks such as resolving exceptions and dealing with queries.
- Data management projects can be challenging. Participants cited issues with legacy code as a key barrier to successful enterprise data management projects, highlighting the need to find the right technology platform and partners to help overcome these challenges without costs spiralling out of control.
- Governance a key concern. One of the areas that firms seem most keen to outsource to managed service providers is data governance. This is because managing permissions and controlling the use of data can be challenging for in-house teams. Managed service providers that can tag data correctly before it reaches client businesses are seen as adding real value.
- Enterprise data management systems must prove success rapidly. Only by committing 100% of data to data management systems can firms optimize the benefits of the system and reduce implementations. Any data that can’t be automated requires manual intervention and therefore kills the business case and rationale behind implementing an enterprise data management system. Moreover, data management projects must be able to prove a 99% success rate in order to be prioritized for investment over other revenue-generating projects.
- Fee transparency is still an open debate. While some firms are putting index costs in front of clients, this approach has by no means achieved consensus. Firms at the event agreed that transparency is easier where there is an institutional mandate, but less so for retail funds.
- Environmental, Social and Governance (ESG) criteria show promise. While it is early days for ESGs, there is a great deal of interest in the criteria. Firms are currently trying to find a way to capture ESG data and use it to build products, while being flexible enough to adapt to likely changes in this space.
- Firms find licence management a challenge. Controlling licences and their compliance was seen as a challenge for direct sourcing models for some firms.
The RIMES Forums provide our customers with an opportunity to debate topical subjects. What is clear from this Forum is that managed data services are increasingly viewed as a strategic and valuable part of buy-side firms data management capabilities; providing a mechanism to enhance data quality and control while freeing internal resources for other activities.
The content provided in these articles is intended solely for general information purposes, and is provided with the understanding that the authors and publishers are not herein engaged in rendering regulatory or other professional advice or services. Consequently, any use of this information should be done only in consultation with qualified legal counsel. The information in these articles was posted with reasonable care and attention. However, it is possible that some information in these articles is incomplete, incorrect, or inapplicable to particular circumstances or conditions. We do not accept liability for direct or indirect losses resulting from using, relying or acting upon information in these articles.
- LIBOR Reform: What’s Next and How Can Firms Adapt?
- RIMES’ New ETF Service Scales Business Processes, Lowers Cost and Improves Risk and Performance Measurement for Buy-side Firms
- What Makes a Data Partnership Strategic?
- Full-Service Model: The Single-Platform Utopia That Can Leave You Wanting More
- Tap Managed Services to Solve and Scale for the ETF Data Challenge