Who would think an analyst publicly touting and privately trashing a stock would result in another technology project on your plate? Well, it has. Analyst Henry Blodget's widely reported improprieties at Merrill Lynch have caused NY's Attorney General and the Securities and Exchange Commission to crack down on Wall Street - forcing financial-services firms to show they have the proper technology in place to retrieve and archive all electronic communications.
In the last year alone there have been many new and onerous regulations placed on financial institutions. It seems to have started with the tragedy of Sept. 11, which was followed by the threat of regulations to monitor disaster-recovery plans. However, even without the threat, institutions widely recognized the need to enhance and invest in these programs. Also, as a result of Sept. 11, the USA Patriot Act was created and regulations were made effective in April. These regs were created to help prevent money laundering and terrorism funding, adding another major technology issue and expenditure to the CIO's to-do list.
It didn't stop there, the collapse of Enron and other companies have caused firms to investigate investments in collateral-management technology, while the foreign-exchange-trading and money-management scandals at Allfirst Bank and Lehman Brothers have pushed investment in compliance technology. Additionally, recent accounting scandals have left financial-services firms questioning their consulting relationships, forcing them to do more in-house. All of these initiatives require a major investment of time and money.
At the same time, there are many new initiatives that cannot be ignored, such as Web services and wealth management. And, of course, some of the tried-and-true initiatives, like straight-through processing and standards, aren't going away any time soon.
The bottom line? Although the economy and stock market may have gone south, the number of technology initiatives on a CIO's plate is going nowhere but up. That, coupled with industry research suggesting FS-tech spending will continue to remain flat for another year, is making the CIO's job more difficult than ever.
If budgets are to truly remain flat then something has to give, or CIOs need to take another look at how they are running their businesses. Prioritizing, being creative and resourceful are becoming more important than ever. In a booming market, everyone looks like a star. A down market is the time to differentiate yourself. This is the time where the true leaders, the true innovators - those who can be as resourceful and creative as possible and who are able to do more with less - will stand out.
Wall Street and Technology is holding a Wealth Management Technology Conference on Sept. 24 in NYC. For more information visit: www.wallstreetandtech.com/events/wmconference