Anthony Malakian: There’s No ‘Simple’ in Integration

“It’s really about a rationalization of the workflow and finding ways to streamline and create straight-through processing,” one of the execs noted.

Atlanta Capital’s Dallas Lundy told Waters in May that a merged solution allows a trader “to be faster and more efficient.” And, echoing what Ennis said, TradingScreen’s Chuck Garcia said that his firm entered the OMS/EMS fray because a small group of hedge funds was complaining that the existing suite of products in the marketplace was expensive, complex to maintain, and took too long to install.

Worthwhile Endeavor
An organization’s integration of trading capabilities and utilizing its OMS as a centralized tool is a worthwhile endeavor it would seem, if for no other reason than to reduce the number of vendor relationships that the firm has to juggle.

Even though I doubt whether this would happen, perhaps US and UK firms should consider throwing a few more dollars at their technology resources while reining in their trader compensation packages. The Greenwich report notes that in the UK, trader compensation versus technology spending was 72 to 28 in favor of the trader, while in the US it was 63 to 37 for the trader. In Continental Europe and Asia, excluding Japan, however, it was nearly a 50–50 split.

There has to be an appropriate amount of technology spending allocated to facilitate this integration drive, as this is more than simply merging two systems—as Ennis stated, other tools have to be filtered into this process, such as TCA and ensuring that the firm’s accounting system is properly feeding through data to the front office. Otherwise, those efficiencies will be nil and all you’re left with is a barebones front office trying to figure out why orders aren’t being executed in as seamless a fashion as originally anticipated. And what’s that worth?