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Financial services firms, banks and cultural change

fsi-calcLast year’s Barclay Bank Libor-rigging scandal was likely caused by cultural problems following a speedy expansion, according to a recent BBC News article. A study found the financial services firm’s strong culture of winning, siloed departments with different values, and lack of emphasis on customer and client needs led to the breakdown.

The simple fact is that we live in a changing world. The Darwinian theory of having to change in order to survive continues to ring true.  Banks and financial services firms have learned this lesson the hard way—through fines, reputational damage and in some cases, having to close their doors.

This pandemic of high-risk attitudes towards winning at the expense of customers has to be cured. In the case of Barclay’s, the answer to restoring the bank’s reputation lays in comprehensive change, according to the news article.

So how can banks make these much-needed changes? The answer exists in two parts.

  1. Ethics must change throughout the financial services industry, with everyone from the highest C-level executives, to IT help desk technicians ensuring they do. Responsible, transparent behavior needs to be the order of the day. This is by no means going to take place overnight; it will be part of an ongoing journey that all employees must undertake.
  2. Part of the answer lays in flexible, adaptable and manageable financial services IT solutions that provide the governance, monitoring and reporting capabilities needed from top to bottom. To do this properly, banks need to invest in deploying rules-based technology that can provide the deliverables sought.

Ultimately, good ethics or IT capabilities can’t deliver the sweeping sea of change needed in the financial services industry alone. They must be put into place together. The top-down instilment of ethical behavior must be supported by the thorough governance, monitoring and reporting capability of sound financial services IT solutions. The twain will simply have to meet.

Go International

Written by Michael Martz
14 October 2010

As I’ve just returned from a trip to Scotland, what topic could be timelier than international EDI? It was tough enough communicating over there with both ‘sender’ and ‘receiver’ using English (we figured that if we could identify one out of five words being spoken to us, we stood a good chance of figuring out the message. That’s generally not a good approach in business). It’s exponentially more difficult when two different languages are involved. The good news is that there are already standard ‘languages’, such as X.12, EDIFACT, and XML, that can streamline the process of document exchange between partners across the world.

We didn’t do a lot of international EDI at my previous employer, but we did enough to have allowed us to identify areas of special concern when dealing with partners outside the USA. The beauty of EDI is that there’s usually a document for everything, and as long as there’s agreement on the standards, you can make some progress. That doesn’t mean it’ll be easy. As I mentioned in the past, most of our work was in connecting to customers who wanted to execute the order to pay process electronically with us. Doing that with an international customer in theory should be no different, but there are a few caveats:

– The obvious first question is…

The read the article, click here.

The retailers’ dilemma

SEEBURGERAs they decide how to stock their shelves later this year, America’s shopkeepers are debating whether the recent rise in consumer spending will last.

THE mood of executives at retail firms normally moves in lockstep with that of their customers. But in America the news on May 25th that consumer confidence had reached its highest level in two years left them oddly subdued. Consumer spending per person, which fell for two years in a row for the first time since the Depression last year and the year before, has been rising again in recent months. But as retail executives place orders for the crucial end-of-year rush, they are anxiously debating how strong and lasting the consumer’s revival will be. Read more

U.S. Growth in 4th Quarter Revised Slightly Lower

4th Quarter GDP growth in the United States has been revised slightly lower

From NYTIMES.COM

Economic growth in the last quarter of 2009 was slightly less robust than previously thought, the government said on Friday. But corporate profit in the quarter rose significantly, providing hope that businesses might begin hiring again.

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The Top 10 IT Focus Points for 2010

What are your priorities for 2010? Reducing IT costs? Complying with the growing number of regulatory requirements? Improving availability and performance of critical business services?

If your IT organization is like many, these may be your top three priorities for the year ahead. At least that’s what was reported in the 2009 IT Market Survey of more than 400 IT professionals in Europe and the United States.

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