The Innovator Awards
- Monday, October 1, 2007, 21:00
- Cover Stories, Special Features
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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.
| Innovation in Business Intelligence – Lehman Brothers |
Lehman Brothers has found success in delivering SQL Server Analysis Services (SSAS 2005) to business divisions to enhance their ability to build analytical cubes and improve the end-user experience with the availability and richness of the data views provided.
A mortgage analytics application from within the Fixed Income Technology & Analytics division that uses SSAS is the largest online analytical processing (OLAP) application within Lehman Brothers, with close to 1 billion records, and is also the first 64-bit implementation at Lehman Brothers. The application is a 100 percent multidimensional online analytical processing (MOLAP) storage model; this includes prepayment, delinquency, loss, and information at a deal/loan on a monthly basis. The business community is comprised mostly of mortgage brokers getting loan performance information against different cuts from the cube. It allows business users to have a quick analysis on mortgage loans securitized by Lehman and over the entire non-agency market. The OLAP application gives the users the ability to dynamically generate the reports with various drill-downs. The analysis includes both origination trend and monthly performance including prepayment, delinquency, default and severity with over 30 dimensions and 80 measures.
A second application within the fixed income business that uses SSAS is a fixed income sales OLAP application built to provide sales, credit and analytical information to fixed income business groups involved in supporting the sales and client organizations. The business users use a tool from ProClarity (which was acquired by Microsoft last year) to access the data directly. This application was migrated from a 32-bit architecture to a 64-bit architecture and also migrated from SSAS 2000 to SSAS 2005.
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| Web Site Innovation – Regions Bank |
When Regions Bank and AmSouth Bank agreed to merge last year, in a combination that would result in one of the ten largest banks in the U.S. and a near-doubling of Regions Bank’s customer base, the firm’s IT department took a new look at its Web site. In anticipation of a major boost in site traffic, the bank decided to re-architect its Web infrastructure into an innovative three-layered distributed system that would not only give it enormous flexibility to scale to meet customer demands, but also add significant security to the much larger Web operation.
Regions Bank’s new Web site involves an in-house built .NET-based content management system and a four-tier architecture that includes separate tiers for presentation, business logic and data. Though the site was not previously Windows-based, in architecting the expanded site the bank chose Microsoft for its scale and extensibility and the ability to increase the number of users and site traffic without impacting performance. The flexibility of the new architecture will allow the bank to add additional servers at one tier – the presentation tier, for example – without being tied to boosting other tiers that may not require extra capacity. In all, the bank aimed to double its existing maximum capacity, so where it has once supported 30,000 concurrent users, the new infrastructure is now supporting double that and internal tests have shown it can handle three times that volume.
However, Regions has not stopped there. To stay ahead of the curve, the bank chose to work with Wintellect, a Knoxville, TN-based Microsoft Gold Certified Partner, to incorporate Windows Communication Foundation (WCF) into their working prototype for additional changes to the site. This positions the Regions team to explore future ways to improve its resource utilization, management of network traffic, responsiveness, and its ability to add extra layers of security. The WCF component currently running in a test environment at the bank has demonstrated the ability to further improve the communication layers between the different tiers of the distributed architecture. By improving resource utilization, it has shown that it can improve the management of network traffic and effectively increase responsiveness. Furthermore, its granular adjustability allows the bank more control over its security, and positions the bank to be able to take advantage of newer technologies, such as Windows Presentation Foundation (WPF).
| Innovation in Mainframe Migration – Progressive |
Progressive, one of the nation’s largest insurers of private automobiles, replaced its mainframe-based policy management system with a new, .NET-based system using Microsoft SQL Server 2005 Enterprise Edition (64-bit) running on Microsoft Windows Server 2003 Enterprise Edition (64-bit).
The old mainframe-based policy management system (Proteus) built in 1979 was based on flat files and had been upgraded and extended over the years in ways that added significant complexity to the system.
The new system, being built using the Microsoft Application Platform, will manage all events in a policy lifecycle and integrate with other applications for policy creation, endorsements and reinstatements. Approximately 28,000 employees and 30,000 independent insurance agencies will access the system through Web-based access supported by Microsoft technology.
When full deployment is completed in 2008, the new policy management application is expected to have 2 terabytes of data hosted on SQL Server running on Windows Server, with near-term growth expected to approach 10 terabytes. Created using Microsoft Visual Studio 2005 and the Microsoft .NET Framework version 2.0, the new application will manage all the business rules for policy events, from receiving quotes and creating new policies, to adding endorsements, processing cancellations, reinstatements, renewals, expirations and deletions.
A PolicyOps database hosts all of the company’s insurance policies. The PolicyOps database is federated over several instances of SQL Server 2005 to ensure scalability. In addition, there is a pub/sub (publish/subscribe) database, an instrumentation database that temporarily stores application performance information for monitoring the performance of the policy management application, and a “policy mart” database that contains point-in-time histories of all policies. The databases are protected for high availability.
The new solution gives Progressive ease of integration with the more than 100 other systems with which it interacts. The use of .NET Framework and SQL Server has reduced application development time, making it easier to create new solutions and respond to market needs. The SQL Server system has also improved scalability over the old mainframe system and provided enterprise-grade reliability.
| Database Innovation – Citi’s Lava |
Citi’s Lava has developed a Reg NMS-compliant pricing database to capture and store all real-time price quotes from U.S. exchanges and electronic communication networks, and allow for the fast re-creation of the available bids and offers for a given symbol at any given time. Developed with SQL Server 2005 technology, Lava launched a 70-terabyte capacity platform dubbed, “Tick Database,” that ensures its financial services customers can show compliance with the Reg NMS trade-through rule, as well as demonstrate best execution. The solution involves the storage of large amounts of pricing data utilizing an innovative data model that allows for extremely fast re-creation of the order book for a given symbol at any point in time.
In addition to its Reg NMS pricing functionality, the “Tick Database” will serve as a generic repository for quote and trade information from all significant sources of liquidity in the U.S. equity market and enable predictive modeling based on Lava’s historical market data archives. As a provider of intelligent order routing services, Lava has been processing and storing full depth U.S. equity market data since November 2001 and with its “Tick Database” solution, it can now recreate and analyze historical market behavior down to millisecond granularity. This type of time-sensitive analysis of market movement provides a real world context for validating and adjusting program trading models and algorithms.
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| Innovation in High-Performance Computing – UniCredit |
UniCredit’s Markets & Investment Banking division is running a .NET-based pricing and risk management engine on a 64-bit Windows Compute Cluster Server for the firm’s structured derivatives business. The cluster is used for two types of activities: daily front-office work including real-time risk analysis and the pricing of complex financial instruments; and overnight processing of data to deliver internally to other departments.
One of the key objectives was quick time-to-market for sophisticated structured derivatives products. The firm also sought to address structured derivatives activities combining all asset classes, including equity, credit, interest rate, foreign exchange and commodities. As a result, silos had to be combined into a cross-asset trading platform based on service-oriented architecture (SOA) principles.
After initial deployment, the bank migrated the entire cluster to a 64-bit Windows Compute Cluster Server. The bank implemented its own job processing logic based on .NET. The team uses Visual Studio Team System with Team Foundation Server and SharePoint Portal Server.
The solutions have helped the division greatly reduce processing times, shrinking the processing of algorithms from several days to seconds. As a result, the division can handle more volume and continually increasing complexity. The solution has also helped the firm reduce time-to-market for innovative product solutions and make faster trade and risk management decisions. Meanwhile, the standardized IT environment has reduced complexity, cost and operational risk, resulting in an environment that is easier to manage, so that managing the cluster is now just part of the normal workflow for IT personnel.
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| CRM Innovation – EDS Solcorp’s WealthServ |
EDS Solcorp’s industry leading WealthServ suite of applications for investment dealerships and managing general agents is an ASP-delivered back-office solution that provides compliance, sales management, accounting, reporting, commissions, compensation and client and agent/rep self-service capabilities through an online Web interface. It is also fully-connected to the industry supply chain, including trading organizations and other industry suppliers, through WealthServ IDEX (Insurance Data Exchange).
Now, through an integration with Microsoft Dynamics CRM, WealthServ will combine the significant amount of 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 the insurance agent or investment representative. The two-way integration of critical customer data with Microsoft Dynamics CRM will allow the representative to have current and complete customer data with the familiar Microsoft Outlook look and feel. Extensive data on customer holdings, insurance and pending business will all be available on a real-time basis.
The Microsoft Outlook-based user interface will reduce training costs to near zero, allowing sales representatives to be added quickly with a short learning curve. Combining CRM features with access to actual client investment and insurance data creates a one-stop shop for increasing sales and maintaining clients. The addition of CRM features creates potential for very targeted campaigns, for example, zeroing in on individuals with certain tombstone information that falls within specific insurance and investment criteria.
To implement this seamless integration, EDS has created a full Web services layer within the WealthServ Investments and WealthServ Insurance applications. This provides complete data and process transparency. The implementation not only involved standards-based Web services but also an out-of-the-box BizTalk 2006 CRM adapter that handles communication with the BizTalk-based WealthServ IDEX product that provides data interchange services to WealthServ Insurance and WealthServ Investments.
Moving forward, EDS Solcorp will continue to leverage additional Microsoft Dynamics CRM features such as support for mobile devices and application hosting frameworks.
| Order Management System Innovation – Linedata Services’ LongView Live |
With a SQL Server database on the back-end and a Windows XP front-end, LongView, Linedata Services’ powerful, global multi-asset class order management system (OMS), has a long and successful track record of leveraging Microsoft technology. Linedata Services recently previewed the next generation of its OMS, called LongView Live, which takes its partnership with Microsoft to the next level.
Linedata Services is the first to bring the power of Windows Presentation Foundation (WPF) technology to the trading technology space, giving LongView Live an interface reminiscent of a cockpit for a fighter jet – a dramatic change from the clunky, spreadsheet-like interfaces that many traders now cope with on other systems. It also allows LongView Live to integrate “live” data feeds from several sources into one front-end, in a way that makes it easy for traders and portfolio managers to view, compare, process, and use data. WPF, which enables richer control, design, and development of the visual aspects of programs, is pre-installed in Microsoft Vista.
LongView Live incorporates data from execution management systems and other alternative trading destinations. When the system is rolled out to clients, it will include all the existing functionality of LongView Trading, including new technology that keeps the digital trading blotter in perfect synch with the blotters of EMSs integrated with the platform. This makes it possible for orders to reside on both the LongView OMS and one or more EMSs at the same time, which allows traders to work trades in multiple locations simultaneously. LongView Trading is currently used by ten of the top 25 global asset management firms, as well as 150 clients worldwide. All of those clients will have access to the new interface in the coming months.
“When traders make trading decisions, a big part of those decisions is based on real-time data coming from many disparate systems. We have found a way to intuitively display this information in an integrated, very informative format,” says Jack Wiener, executive vice president. “Because of our experience with Microsoft, we were able to leverage this technology easily and bring this functionality to market very quickly.”
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| Innovation in Spreadsheet Risk Mitigation & Compliance – Prodiance |
Prodiance delivers an enterprise-class software solution to help organizations improve compliance and mitigate operational risk for mission-critical spreadsheets and Access databases. Although Excel is a ubiquitous and powerful tool used, key processes such as financial reporting, closing the books, equities trading, insurance risk and uncertainty, often require a higher level of governance, oversight and control. The Prodiance solution was designed to meet auditor guidance for spreadsheet controls and delivers a comprehensive lifecycle approach, from discovery, inventory, and risk analysis, to management, workflow automation and monitoring.
The Prodiance solution can quickly discover spreadsheets and Access databases dispersed throughout an organization’s network, create a comprehensive inventory report (including any linked spreadsheets), and perform a detailed diagnostic analysis. This helps firms evaluate spreadsheet complexity, identify errors, and determine risk. To establish a controlled environment, Prodiance provides a tool to migrate inventoried spreadsheets into secure Office SharePoint Server 2007 document libraries while preserving any links that exist. The Prodiance solution is integrated with Office SharePoint 2007 for core document management capabilities, including access control, collaboration, versioning, check-in/check-out, archiving, and workflow. It adds significant value to SharePoint by remotely monitoring changes to critical spreadsheets and Access databases via a cell level audit trail, and reporting on change events. The audit trail allows managers to see when critical changes were made, who made them, change descriptions, and reason codes for the changes. The system can be configured to send proactive alerts to let users know when certain change events have occurred, and to route changes for review and approval via email.
Windows Workflow Foundation (WWF) automates review and approval processes for the Prodiance solution, and SQL Server 2005 Reporting Services provides a management reporting framework with a variety of standard and custom report templates that can be scheduled and/or subscribed to by users.
End user adoption is paramount to many businesses, and Prodiance has designed the system to be non-invasive to end users. No software installation is required on client computers, and the product does not interfere with the user experience or performance of existing spreadsheets. Managers, auditors and executives can gain visibility into changes, approval status, user access levels, spreadsheet inventories and risk levels, and other metrics through Web-based reports.
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| Innovation in Channel Renewal – Fiserv |
Fiserv, Inc. is the world’s largest vertically-focused provider of information management systems and services to the global financial services industry. For three consecutive years, Fiserv has been ranked #1 on the annual FinTech 100 list published by American Banker and Financial Insights.
Fiserv’s Aperio, developed in .NET and delivered exclusively on Microsoft’s Windows Server and SQL Server, offers banks an advanced solution for managing customer interactions through the branch and call center. Aperio’s powerful business process management technology helps streamline sales and service operations to improve efficiency and optimize the customer experience. Where fulfillment work stems from customer interactions, Aperio manages workflow end-to-end across banks’ front, middle and back offices.
Aperio adeptly integrates with multiple back-end systems, bringing together customer and product information in a 360° view of customer relationships. This deep, real-time integration allows bank’s staff to interact with an intuitive, process-based user-interface for all sales and service interactions, while Aperio transparently performs required operations on other systems, shielding customer-facing staff from the complexity and constraints of legacy systems.
The real-time, predictive analytics feature of Aperio also helps banks to execute the most suitable cross-sell, retention, data gathering and risk management strategies during everyday customer interactions based on up-to-the-second customer information. And with its service-oriented architecture, Aperio enables institutions to deliver sales and service functionality directly to their clients via the Internet channel by exposing multi-channel business process definitions to client-facing Internet applications via Web services.
Earlier this year, with support from Microsoft, Fiserv led a joint initiative with two other Microsoft financial services partners to demonstrate how best-of-breed, Microsoft-based banking channel solutions can leverage their open architectures to share critical functionality such as in-bound marketing campaigns across customer touch points such as teller, Internet, call center and branch platform. Dubbed “Project Trinity,” the resulting integration illustrates how a bank can pursue a multi-channel technology strategy without sacrificing the benefits of best-of-breed solutions for all channels.
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| Wireless Innovation – Pyxis Mobile |
Pyxis Mobile offers a full range of wireless software solutions to help the financial services community maximize productivity remotely. The firm has 80 clients, including 26 of the top 50 asset managers and ten different products designed to bring increased mobility to specific tasks in financial services.
“Our strongest differentiators are our focus on the financial industry and our product’s ability to connect data from across the enterprise into a single, easy-to-use application,” says Christopher Willis, executive vice president for Pyxis Mobile. “Our industry focus, tied to our technology approach allows us to deliver a converged view of business information that drives productivity, reduces trade errors, and raises assets under management for our customers.”
Among its software applications, Pyxis Mobile’s mWholesaler offers wireless access to CRM data, alongside sales reports, activity histories, and complete contact information. Users can access quotes, in-depth news, filtered news, statistics, analytics and receive alerts based on their firm’s specific criteria. Pyxis Mobile’s mAdvisor allows users to develop and track client relationships, and provides access to static and real-time reports including open/executed orders, profit and loss, holdings, cash and exposure. The company’s mPortfolio allows users to access order management systems, portfolio management systems, compliance systems and market data. mDashboard is a high-powered business intelligence application that allows users to extend reports and data from any investment management system to wireless devices. The company’s mInstitutional, mInvestment Banker, mHedge Manager and mAnalyst have additional functionality for those specific roles.
Pyxis Mobile server-side software is all .NET-based and the company started offering support for Windows Mobile-based client devices earlier this year. The company handles all the upgrades for customers and has recently signed a number of partners who leverage mPlatform to develop their own mobile initiatives.
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