Enterprise Data Management (EDM)
EDM – What it is and why it is essential
Let us consider:
How much can a bank lose if its information on the financial products used for its investments is incomplete or not accurate? The current crisis born from underrated and misunderstood Credit Derivatives proved once again the importance of good market data and accurate information.
What is the acceptable cost of risk for canceled or delayed financial transactions due to incorrect data transmitted between two different applications?
Can a financial institution depend on only one external source for pricing its assets and portfolios, especially when dealing with OTC products? However reliable the source, considering the huge amounts of money involved – up to several hundred of billions - it would be wiser to have a second independent source to challenge it.
What is the human cost of manually keying and administrating the same information in different applications or departments of the bank due to inefficient or partial integration between them?
Large banking groups often pay several times for the same data or pay for data they do not require anymore. Decreasing this sizeable budget by 10 to 20% through improved management of the required data is in itself justification for implementing the SmartCo DataHub.
What is the acceptable delay that a front office desk, a product structurer or a quant analyst can allow for receiving the new information it requires? One day? One week? One month? How quickly are you able to respond to requests for data enabling a new structured or derivative product? Given the urgency of such requests do you have an IT department that is able to react and implement the additions in a satisfactory time frame?
Most answers to these questions lead to the same conclusion: efficiency and data management are closely linked, and a proper and complete data management policy is a must with today’s fast changing financial activities.
To simplify the term, EDM focuses on both the creation of shared, accurate, consistent and transparent data content and its distribution within all departments of the enterprise with the objective of improving the efficiency of global operations.
The positive impacts that a good EDM policy generates strongly offset its implementation and operational costs. In the financial industry, where manipulating information is crucial, the need for EDM has never been stronger.
This demand is sustained by a context where many financial services players are reorganizing or merging, and where regulations are constantly becoming more complex and stronger. This trend, which is projected to continue, is prompting financial institutions to rationalize their information systems and organize their data processing. SmartCo provides the right solution to reach these goals.