Recognizing Outstanding Innovation in Deploying Advanced Microsoft Technologies

Technological innovation can drive competitiveness and lay the foundation for leadership. For companies in the fast-paced financial industry, the key to success is aligning advanced technologies to meet specific business needs. The ten firms profiled on the following pages have done just that. They have adopted technologies ranging from 64bit computing, Web services and portal servers to business intelligence, wireless and spreadsheet technology and have positioned them, at times even modified them, to address specific industry challenges.

Through the Innovator Awards, now in its third year, Windows in Financial Services recognizes those firms that have harnessed the fl exibility, scal­ability and reliability of Microsoft technology to remove obstacles to progress and create new opportunities.

The 2007 Innovator Award Recipients are:

• Innovation in Business Intelligence – Lehman Brothers
• Web Site Innovation – Regions Bank
• Innovation in Mainframe Migration – Progressive
• Database Innovation – Citi’s Lava
• Innovation in High-Performance Computing – UniCredit
• CRM Innovation – EDS Solcorp’s WealthServ
• Order Management System Innovation – Linedata Services’ LongView Live
• Innovation in Spreadsheet Risk Mitigation & Compliance – Prodiance
• Innovation in Channel Renewal – Fiserv
• Wireless Innovation – Pyxis Mobile

At the 2007 Securities Industry and Financial Markets Association (SIFMA) Technology Management Conference & Exhibit in June, Microsoft launched its first-ever reference implementation, or sample application, to help Wall Street build trading solutions on the Microsoft platform. The sample application, called .NET StockTrader, is an end-to-end application based on an online stock trading scenario that is meant to give companies a blueprint for how they can use Microsoft technologies, such as Windows Communication Foundation (WCF), to create service-oriented architecture (SOA) solutions to advance their businesses. It’s accompanied by a technical white paper that provides guidance for developers. The technical white paper information includes benchmark data to illustrate alternative technologies within .NET and their relative performance. The application also offers full interoperability with J2EE and IBM WebSphere’s Trade 6.1 sample application, providing developers with an opportunity to see first-hand the possibilities for building interoperable .NET-based service-oriented applications.

For almost two years William F. Adiletta has served as president of TekFinancial Solutions, working to expand the company’s offering in the financial community in areas such as enterprise integration, electronic trading systems development, wealth management, SOX compliance, managed IT services, network security and FIX integration. Over the past 25 years, he has developed wide expertise in financial IT through various roles, including serving as CIO of Global Crossing and holding several executive positions at Optimark where he developed exchange systems for the Pacific Stock Exchange, NASDAQ and the Osaka Stock Exchange. We spoke to him about recent experiences helping clients move from Visual Basics to .NET and how the move often signifies a change in the way firms approach business.

Like many investment firms, ML Stern has long taken seriously its responsibility to store and archive email. As a result, its email archiving and retention system had been installed years ago.

“It was prehistoric,” complains Mike Urman, ML Stern senior vice president of marketing and operations.

• Ten More Spanish Banks Select SunGard’s BancWare
• Jefferies Prime Brokerage Partners With Linedata
• IP Commerce Pushes Reseller Program
• Microsoft Buys Parlano
• Formicary Becomes Microsoft Certified Partner
• Brazil’s Mellon Serviços Financeiros Selects Charles River
• Microsoft Aids South African Startup
• XSP Partners with Web Services Integration Limited to Offer Withholding Tax Reclamation
• SlaterLabs Signs Two-Year Support Contract with Microsoft
• Wolters Kluwer Ships Microsoft .NET Version of Expere
• Clear2Pay Delivers Open Payments Framework on Microsoft Platforms
• Fiserv-CheckFree Aims for Both Core Processing and Online Lead

As Hawaii-based insurer DTRIC expands its commercial lines in the second half of the year, it is doing so with a newly built service-oriented architecture-based policy administration system that allows it to pick and choose features from its existing legacy technology.

DTRIC established itself in Hawaii in 1992 at a time when many insurers began pulling out of Hawaii following Hurricane Iniki, the state’s costliest hurricane ever. Soon after, DTRIC stepped in to replace a major insurer who canceled the group automobile program for the state’s largest public employee union...

• Marquez Leads Channel Renewal
• Vanguard IT Exec to Oversee CheckFree EPL Conversion
• Former Financial Insights Exec to Lead Partnerships for CA
• Jack Henry Promotes Hopkins to Manager of Internet Solutions
• Magenic - Paul Fridman
• Transitioning to Exchange Status, BATS Promotes Ratterman
• Connotate - .NET Ahoy

JPMorgan entered production early this year with an electronic trading application which uses a .NET-based treemap tool for instantly analyzing client sales.

“The treemaps give us a clear picture in real-time of what’s happening across a large volume of (sales) data. This is something we’ve never been able to do before, and the feedback from our clients is quite positive,” notes Daniel T. Marsh, a London-based project manager in JPMorgan’s electronic trading area.

Established in 2004, the investment management firm Clearbrook Financial prides itself on its embrace of a philosophy that is still new to the financial services industry: transparency. In executing that philosophy it has formed strong partnerships with financial technology vendors.

For one, Clearbrook uses CheckFree Corp.’s APL-based products (named after an array of programming language dubbed A Programming Language) across business functions running the gamut from operations to performance reporting.

It has been a couple of years since Texas-based Barnard Donegan Insurance moved to a .NET-based agency management system. In that time, the firm has added offices, replaced a paper-shuffle with document imaging, and saved as much as an hour and a half each day in the reduction of repetitive entry tasks.

“It has really helped us to expand some,” says Martin Morris, Barnard Donegan operations manager, about the AMS 360 system from Bothell, WA-based AMS Services that the firm adopted in an effort to improve efficiency. “We’ve expanded our coverage area and added locations.”

Fierce competition in the banking industry makes it tough for new banks to gain a foothold in the market. But Rogers, AR-based ANB Financial played it smart by leveraging Jack Henry and Microsoft technology to support its growth strategy, increase efficiency and deliver superior customer service.

ANB Financial was founded in 1994 with a mere $25 million in assets and one location. Thirteen years later, the bank has about $2 billion in assets and more than 300 employees spread over several branches in Arkansas, Idaho, Utah, and Wyoming. In addition to offering a full range of traditional banking services, ANB Financial is working to establish a broker-dealer and a hedge fund based in Chicago to cater to its customers’ investment needs.

Founded in 1997, CNLBancshares, Inc’s (CNLBank) mission is to be the largest independent bank headquartered in Florida, while being recognized as a bank of choice for middle market businesses, commercial real estate, developers, home builders and high-net-worth individuals. By partnering with Harland Financial Solutions, the bank has leveraged its core processing technology to not only differentiate itself from its competitors, but also to turn its mission into reality.

Back in 2003, CNLBank was the 46th largest commercial bank headquartered in Florida with $100 million in assets. By the end of 2006, it had risen in the ranks to #11 and had organically grown to about $1.3 billion in assets. In fact, the bank has grown at a CAGR of 60 percent for the last five years, and its earnings have grown at a CAGR of more than 100 percent. CNLBank now has separately chartered banks in some of Florida’s major metropolitan markets, including Jacksonville, Orlando and Southwest Florida. CNLBank plans to enter additional markets as opportunities become available.

Raymond James’ 4,640 advisors have complete flexibility in how they manage their customer relationships. Until recently, that also meant the customer relationship management (CRM) tools the advisors used were locally managed, and may have varied from homegrown spreadsheet type systems to third-party solutions individually selected at each location.

This spring, Raymond James began offering its advisors a new proposition. Working with Microsoft, Raymond James launched a centrally-managed Microsoft Dynamics CRM system intended to give its advisors the latest tools and functionality for managing customer relationships without the advisor having to undertake the effort involved in implementing, maintaining and backing up a system for managing extensive client data.

The insurance industry is under increasing short-term pressure. It faces growing competition from non-traditional competitors and must satisfy an investing public, increasingly aware of the ever-expanding number of investment options. In step with these pressures, the industry has evolved to develop products that are more complex and offer more aggressive returns.

Microsoft Startup Center Teams with Bank of America, MasterCard and FedEx

Startups generally need funding, and Microsoft’s Startup Center added tools to help entrepreneurs access and manage funds this summer when it announced partnerships with Bank of America Corp., MasterCard Worldwide and FedEx Corporate Services for financial management, payroll and shipping solutions.

Startup Center, which launched in March as an extension of Microsoft’s Small Business Center, focuses on the more than 1 million businesses that startup in the US each year, according to Microsoft estimates.

HCL Technologies is a $1.4 billion global technology consulting and IT services company founded in India in 1991, as a division of HCL Enterprise, a $4 billion organization and one of India’s oldest IT companies. Now one of India’s leading businesses, HCL Technologies employs over 42,000 professionals in 86 offices located in 17 countries in Asia, Europe, and North America. HCL has global partnerships with several Fortune 1000 firms including leading IT and technology firms (see www.hcltech.com and www.hcl.in).

The advantages of outsourcing complex technical tasks such as creating software-led IT solutions, remote infrastructure management services and business process outsourcing is now widespread, and its advantages are well known. HCL has delivered solutions for corporate sectors as diverse as financial services, retail and consumer, life sciences and healthcare, hi-tech and manufacturing, aerospace, automotive, telecom, and media and entertainment.

Insurance companies often say they have a distribution strategy, but what they often really have is a compensation strategy. Many believe as long as they get the compensation right, everything else will fall into place. In some instances, that may work. But Springfield, Mass.-based Massachusetts Mutual Life Insurance Company (MassMutual) wants to better understand who its distribution partners are, how they relate to each other, and what role they play in a sale. In order to do this and support a larger modernization initiative, MassMutual is entirely revamping its IT infrastructure with the help of many vendors including SAP.

StreamBase Systems (www.streambase.com), a leader in the fast-growing complex event processing (CEP) market, has pioneered a remarkable new approach to processing and analyzing real-time streaming data. Founded by data management experts who have been driving industry innovation for decades and backed by top-tier investor firms, StreamBase has developed a new class of stream processing software. Global organizations are witnessing its high performance coupled with its intuitive graphical development environment that eliminates the need for costly, inflexible custom-coding.

We recently spoke with Barry Morris, Chairman and CEO of StreamBase Systems, Inc. about high-performance CEP and the trends that are driving its adoption in financial markets.

Visionaries in the payments industry discuss connectivity, cost, standards and efficiency.

By Paul Allen

Automation and efficiency are evergreen topics within the financial services industry. But in the payments sector in Europe these forces are being given extra impetus by the launch in 2010 of the Single European Payments Area (SEPA).

SEPA was hatched in response to demands for a single Europe-wide market where cross-border transactions would be as cheap as they are domestically. But this means banks, corporates and other payments participants are having to introduce automation into their processes wherever possible in order to bring down costs. Add in the normal competitive pressures that face industry players worldwide anyway and the upshot is a huge drive towards automated connectivity and straight-through processing.

In light of this, Windows in Financial Services asked four industry participants from different parts of the value chain what they see as the key issues facing market players at present, and the roles their organizations can play in the environment’s evolution.

Whether it’s traders reacting to hourly stock fluctuations or brokers responding to unexpected transaction requests, the financial services industry moves quickly, and leaves little room for error. Few understand this better than Infusion Development, a unique IT consulting, solutions and training firm with headquarters in Toronto and New York as well as offices in Boston, and London, UK. Infusion Development counts some of the world’s largest financial companies among its clientele.

Since opening its doors in 1998, Infusion Development has grown steadily to over 175 employees, a feat the independently owned company attributes to its passion for new technology.

“Infusion Development has made its mark through remaining focused on emerging technologies,” says Alim Somani, president, Infusion Development. “We use some of the latest and greatest Microsoft products to drive collaboration and innovation in the trading floors and operations areas of Toronto, New York and London’s most influential financial institutions.”

From the Editor:

A 64-bit .NET-based pricing and risk management engine running on a 64-bit Windows Compute Cluster Server in UniCredit’s Markets & Investment Banking Division has achieved quick time-to-market for structured derivatives products. Through an integration with Microsoft Dynamics CRM, EDS SOLCORP’s WealthServ will combine the valuable customer data it houses for compliance, commissions, customer service and unified customer portfolio statements with wide-ranging CRM capabilities for an enhanced sales and customer service platform for insurance agents or investment representatives. A comprehensive enterprise-class spreadsheet compliance solution brings control, auditability and error analysis to business critical spreadsheets distributed across an organization in part by facilitating the management of spreadsheets in the SharePoint environment.

Compliance: The Right Way Drives Profitability

Compliance is set to become a key differentiator among financial services institutions. Already some forward thinking FSIs are starting to taste the profits of an integrated compliance management strategy while others are struggling with the costs of more fragmented Band-Aid approaches that result in high levels of waste and duplication. This gap will only widen as regulatory requirements increase and as the cost and complexity of compliance swells. By all counts, it is the more holistic approach that will not only enable compliance in the future but result in improved speed-to-market, decreased costs, reduced risk, an enhanced customer experience, and bottom-line benefits to the business. We ask industry experts for their POV on the challenges to achieving an enterprise-wide compliance platform and to weigh in on profitability.

The markets are fragmenting, transactional volumes are exploding, costs are rising and so too are clients’ demands as firms confront regulatory demands, new technologies, whether to build, buy or outsource – and now there’s cross-asset trading. Through it all, reference data at its core continues to be about descriptive transactional information.

For senior reference data executives like State Street Global Advisors’ John White, one of 10 participants at a recent Advisory Council roundtable co-sponsored by Microsoft and Avanade, who said, “We all need to be extremely nimble as the markets change,” the challenges are real. Here is that hour-long conversation moderated by WFS contributing editor Marty Rabkin. It opens with issues some of the participants wanted to tackle and concludes online at www.windowsfs.com/referencedata.

Although most financial services institutions have made inroads into Business Intelligence (BI), there still is some way to go before the full promise of BI is fulfilled and it is embedded in the enterprise, used by all relevant employees. Microsoft for its part is doing everything it can to speed this process up. Its fast track: Excel.

Excel, used by a large portion of what Microsoft estimates are 500 million company users who have Office licenses, enables Microsoft to deliver pervasive BI and Performance Management to everyone at a fraction of the cost of other BI tools.
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