Data quality and data governance are the top data management priorities cited by buy-side firms in Rimes’ 2015 Buy-Side Survey. The survey respondents, particularly asset managers, also note that a lack of support for data governance and the limitations of existing operating models are hindering business agility and holding back strategy changes.
Now in it third year, the Rimes buy-side survey – www.rimes.com/rimes-2015-buy-side-survey – canvassed the opinions of 120 key decision makers across asset managers and asset owners including investment management firms, custodian banks, hedge funds, pension funds, insurance companies, private banks and wealth management firms. Respondents were from business functions including compliance, risk, data management, front office, IT, operations and performance measurement, with 55% working in central management and 45% being end users.
Reporting on management priorities for 2015, the survey notes that improvement in data quality has moved up the business agenda with 67% of buy-side firms, against 43% in 2014, saying this is their primary data management priority. Giles Arbuthnott, benchmark data service service manager at Rimes, explains: “Firms have become more interested in data quality at the point of use. They recognise that end users are not always getting the data management services they need from a centralised operating model, and understand that central teams tend to focus on data quality for everyone, while users want quality data that is fit for purpose.”
Data governance was cited as the buy-side’s second concern after data quality, with 75% of firms saying the main benefit of adopting best practice data governance is data quality and 57% saying data cost control is a secondary benefit. Drivers behind data governance include not only data quality and cost efficiency, but also regulatory compliance and maintaining a good reputation.
Asset managers responding to the Rimes survey added the limitations of existing operating models and their drag on business agility and strategy changes as a third data management issue to address in 2015.
Overall, Rimes reports a narrower divide in 2015 between survey answers from central IT and data management functions and end users than in previous years. Arbuthnott says: “This year’s survey shows more convergence between central functions and end users. This indicates a growing understanding among central data management functions of what the business needs and suggests the business is getting a better response from central functions. Previous surveys showed central teams were satisfied with data, but users reported low levels of satisfaction with data quality and timeliness, a difference that is now less pronounced.”
Considering how to tackle the buy-side’s data management priorities, Arbuthnott says firms trying to improve data quality and data governance simultaneously using existing systems will find the task too difficult and will need to move away from operational models implemented in past years and look for different data management solutions, such as managed data services or data utilities.
Rimes, a provider of cloud-based managed data services, forecasts a move towards third-party services over the coming year as firms seek to improve critical areas of data management and, perhaps, turn to service providers to handle hard to manage data sets. The use of dedicated service providers, suggests Arbuthnott, can improve data quality as well as data governance through provision of better controls and reporting. He concludes: “Firms cannot change overnight, instead they need to organise themselves for the data management journey and improve over time.”
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