Legacy systems can be a heavy burden on investment firms, hindering their ability to adeptly shift strategies during periods of changing market dynamics. Investing in critical systems and core applications prepares firms to leverage advanced technologies — a rapidly accelerating component necessary to meet stakeholder expectations.

Dated — and dare we say obsolete — financial systems are closely correlated with operational inefficiencies, security vulnerabilities, and limited compatibility. The limitations can impede scalability or even result in missed opportunities. What’s more, complex internal structures and rigid workflows can restrain an organization from embracing emerging technologies, such as real-time data analytics and artificial intelligence.

As firms consider their future, it’s all about embracing digital opportunities. Investment firms looking to create and launch new products, support more diverse complex asset classes, and accommodate evolving reporting demands are turning to cloud-based, scalable data management solutions.

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What to consider as you assess your current platform

Evaluating your firm’s business trajectory over the next five to ten years can help determine if your current operating model and infrastructure can deliver on longer-term goals. Several signs can point to when your firm might be ready to modernize.

We recommend that you first look at system vulnerabilities. The fragility when new patches are no longer released for dated systems, updates cannot be applied, or the vendor no longer supports a certain software can compromise databases and applications. Similarly, disjointed applications using outdated technology stacks heighten your infrastructure’s complexity. If you find your firm upgrading cycles every couple years, it’s a sign to look at how you can modernize the platform.

You may also find that dated systems begin to lag in performance, causing increased resource consumption and higher system failure rates. In addition, dated systems may struggle to connect with more modern applications, external systems, data vendors, and third parties. A patchwork of disparate systems, data models, and sources can add to the magnitude of managing data. Integrating data and establishing connectivity with external providers is paramount for operations, growth, and competitiveness.

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Why timing and preparation matters

While the benefits of digitization are well-established, you will need to assess if timing aligns with business priorities. Researching solutions, budgeting, and planning will let you evaluate your current ecosystem and create a smooth pathway for your firm’s eventual migration.

Data is imperative to meeting operational, investor, and regulatory obligations. Prioritizing your data strategy shifts the agenda toward unified, automated, and optimized data accessibility.

Benefits of a modern data platform:

Cloud-native integration and tools: Flexibly integrate data with modern, scalable, and agile technology, advanced functionality, and intuitive interfaces
Unified and accessible data: Connect data from disparate sources and enable a synchronized source of truth
Expansive data storage: House vast volumes of data with an open, scalable data lake or warehouse
Stronger data management and governance: Strengthen and support changing regulatory obligations with validated, accurate data to comply with Form PF, T+1 settlements, SFDR, and multiple other reporting requirements
Robust data security and integrity: Protect sensitive financial data, client assets, and confidential information with industry-standard cybersecurity frameworks
Optimized performance and efficiency: Advance automation capabilities, streamline workflows, and integrate processes
Extensive scalability: Support business growth and handle data processing requirements to enter new markets and accelerate time to market
Advanced analytics: Gain accurate and granular insights into investment performance with detailed analyses of portfolio returns, performance attribution, risk calculations, and complex financial modeling