If a total cost of ownership model is right, about 70% of capital markets firms are incurring unsustainable front office technology costs.
As noted in market research firm TABB Group's FSI Tech Spend Analysis 2014: Introducing T-Alpha report, many front office technology systems are highly siloed, causing significant duplication that leads to excessive expenses. Further, TABB recommends considering how vendor-managed solutions can help "de-siloize" to reduce these costs.
One such front office technology option is SaaS-based content management.
Just like it sounds, cloud-enabled content management solutions centralize collateral creation. Here's an explanation of why it can help your firm reduce technology costs.
Moving content management to a cloud-based solution reduces front office technology costs in numerous ways. The most critical to Wall Street firms include:
* Consolidating content repositories
Rather than multiple content repositories maintained by individual business or geographical units, a centralized repository provides "a single version of truth."
* Reducing the need for hardware, software and storage systems
Adopting a centralized, cloud-based solution eliminates duplicate hardware, software and storage systems normally needed to support multiple separate content repositories.
* Cutting IT Management Costs
Reduced infrastructure complexity also reduces IT staff costs for deploying and managing a proliferation of separate content repositories and the subsystems they rely on.
* Relieving data staff burdens
As TABB includes data staff in its technology costs model, centralizing content also ensures data staff only need to create charts and graphs once, rather than extracting and manipulating data multiple times.
* Eliminating multiple IT projects
A centralized content system eliminates the IT projects required for evaluating, adopting and updating separate repositories.
Drilling down, there are the five significant ways SaaS-based content management can help improve your organization's front office technology costs.
The first regards mature technology. Content management systems were once large, on-site, solutions that required major budget and staff investments.
Now, mature cloud-based content management is easy to deploy and integrate with internal and external systems and data feeds such as Morningstar and S&P Capital IQ. Plus, selecting the right cloud-enabled option provides a secure, compliant environment that ensures the safety of all content and data.
The second is customization capabilities. Historically, the capital markets invested in proprietary technology systems to ensure their resulting products and services could add value.
Today's SaaS-enabled content management systems provide similar customization options, enabling business units and the entire enterprise to add value more efficiently and effectively than before. Firms control the brand-approved content within a cloud-based centralized repository as well as the internal and external data feeds users are permitted to access. Advanced solutions also offer the ability to customize the portal to firm branding specifications.
The third point to consider is that although innovative new technologies hit the market every year, many lack features critical to the financial services. At the top of the list is compliance.
Fortunately, modern SaaS-enabled content management systems are not only compliant but also improve a firm's overall compliance posture. For example, a solution which integrates with a firm's CRM and ERP solutions provides an audit-appropriate digital record. Additionally, manual compliance approval of individual documents are reduced or eliminated because compliance staff reviews document templates, ensuring the correct content and disclosures appear for referenced products and funds.
The fourth point to consider it that a cloud-based content management system can be leveraged for any internal or external use case. These include pitch books, prospect presentations, onboarding materials, client business planning, investment reviews, client-specific performance summaries, institutional insights collateral and outcome assessment presentations. Robust solutions enable firms to embed rich content, such as thought leadership videos, as well as traditional data and text.
Finally, like any enterprise transformation project, speeding user adoption is critical to success. Running a "pilot" in a receptive business unit can create internal champions who will evangelize the technology organically. Then, as existing licenses expire or systems require upgrading, affected business units can be transitioned onto the new cloud-based platform. This enables purchasing only the seats you need, when you need them, without oversubscribing to anticipate growth.
In short, whether your firm resides on the buy side, sell side, or both sides of the capital markets equation, the right cloud-based content management solution can assist with achieving sustainable front office technology costs.
Doug Winter is CEO and co-founder of Seismic.