Less noise,
please, and more signal

Sure, computers are great for making light work of complex tasks, but there’s always a catch: They only do what they’re told to. Precisely and only that. So, if a digital tool produces less-than-optimal results, chances are good the problem is in what it was told to do in the first place.

And that’s where a particular global investment manager found itself with a specific module within its order management systems (OMS): This module—responsible for monitoring investment restrictions—was throwing out false warnings and alerts. And not in just one region, but all over the place. How come?

Because the systems were following directions! The company’s operating model for investment compliance monitoring (ICM) was distributed rather than centralized, meaning people without context for the other parts of the business were giving the ICM disjointed directions, leading to duplicate—and possibly incomplete or inaccurate—rules. These employees didn’t have a shared understanding of roles and responsibilities for investment compliance work, so there was a lot of process duplication, not to mention unnecessarily high staffing costs.

Getting these issues in hand would mean nothing less than overhauling the ICM operating model: reengineering organizational structures, processes, data, technology, and governance systems around compliance. Besides clarifying who should really be doing compliance work, a new target operating model would also need to describe how that work would be done. (How, for instance, would jurisdictional compliance responsibilities be assigned for global products?) Finally, all rule sets within the manager’s various OMS—both compliance and investment—would need to be revisited. This would be a heavy lift.