Read time 2 minReference data plays a key role in driving business processes and applications. Businesses across sectors including business and financial service companies, credit rating agencies, technology firms, and data and information service providers, rely heavily on reference data. As such, any faulty reference data or error in data management pose a significant operational and financial threat, negatively impacting business outcomes.
In fact, up to 70% of the data used in financial transactions, reference data is what enables organizations to identify key details including financial instrument/market specifications, currencies, counterparty/stakeholder data, corporate actions, and others.
Despite its growing criticality most organizations (especially smaller and medium-sized enterprises) lack the ability to manage reference data efficiently. Challenges such as inadequate audit controls, granular visibility, change management processes, and lack of capturing and processing data from various sources, are making it increasingly difficult to manage. As the demand for efficient reference data management continues to rise, organizations are seeking help from service providers to offer custom solutions. Outsourcing reference data management has become a go-to business strategy as it helps overcome current challenges and establish a sound process for reference data management.
Centralized data management
Outsourcing helps centralize reference data management that provides complete visibility and better control. It enables businesses to maintain consistency across the board, providing access to standardized reference data to teams from various departments. Centralize management also helps easily distribute and update reference data across multiple corporate systems and applications seamlessly, ensuring consistency and in turn better compliance. Greater visibility and consistency also power operational optimization and business analytics processes. It also improves responsiveness and the ability to adapt to new business/data requirements or market trends.
Consistent data across the board
Given the deluge of data coming from myriad sources, maintaining consistency is one of the biggest issues for organizations. Outsourcing allows you to overcome that challenge. The service provider brings tools and systems that help capture and maintain the consistency of reference data. They help efficiently manage every version of reference data and link them to corresponding tables, helping organizations achieve semantic consistency across the board. Consistency is a key factor in data quality, without which it becomes prone to errors.
Easy scalability and accessibility
From instrument mapping, select financials, fund allocation, leadership, and shareholder data to corporate actions and hierarchy and industry classification, a specialized service provider is adept at offering an intuitive and large volume of wide-ranging reference data. They use frameworks to capture data from disparate sources that help uncover deep insights. Outsourcing also helps easily scale up and down as per the business scalability requirements making it an extremely cost-effective option. Increased scope and volume of reference data with seamless accessibility not only helps optimize operations but realize the full potential of reference data in gaining competitive advantage.
At Springbord, we offer custom reference data management solutions to ensure it fits your business-specific requirements. Talk to us today to find out about our entity reference data offerings and how we can bundle our services to meet your requirements.
