In the high-pressure world of financial markets, timely data is key to maintaining a competitive edge. To stay at peak performance in the market, businesses must identify the most appropriate and efficient strategies for the management of hardware, telco, data centers and market access.
This is a complex and nuanced area where decision makers balance agility and control, resources and partnerships, cost and performance, and managed service provision against an in-house approach. Not one of these is a simple either/or situation. Each exists on a sliding scale and must be tailored to suit your individual business and its vision for the future.
With this in mind, what are the key considerations for achieving balance in your trading operations and support?
Agile and Flexible Resources
One of the biggest headaches for any business is matching its people to the tasks in hand. It’s rare that any operational department has a smooth demand on its time throughout the course of even a normal year. When the organization stretches towards new goals, or external factors buffet the market, in-house trading support teams come under significant pressure.
There are challenges for HR in recruiting the right staff to handle peaks of activity and retaining them in the troughs. The lead time for recruiting good staff can be several months, depending on market demand and notice periods for successful candidates. This has a knock-on effect in time to market and ultimately competitiveness.
Elastic resources available through a Managed Service Provider (MSP) allow the business to grow quickly when the need arises, and to scale temporarily for key projects.
There is also the question of individual expert personnel being the ‘fount of all knowledge’ in an organization. The value of experience is felt most keenly when a key staff member leaves.
An MSP has up-to-date expertise spread across teams, rather than concentrated in individuals. The risks associated with natural staff turnover are mitigated – there’s safety in numbers. And when your business needs new skill sets such as regional linguistic support or established relationships in a target territory, the MSP has what you need already to hand.
Harness the skills within your Managed Service Provider to save time, effort and money in recruitment and retention.
Optimizing Cost and Performance
There is an ongoing balance to be struck between capital expenditure (CapEx) and operational expenditure (OpEx). CapEx and long-term investments in infrastructure are coming under threat from the rapidly moving technical landscape in which we operate. Where once a five- or 10-year IT project could be placed entirely on the balance sheet and depreciated over time, this no longer reflects the reality of operations. Rapid changes in the financial market and a focus on profit stability demand a more accurate match between activity and operating costs than a straight line write off provides.
In practical terms, technology obsolescence comes all too quickly, and this can outweigh the advantages of treating infrastructure as a long-term investment. There are some elements of infrastructure that stand the test of time, of course, but the overall risk of falling into technical debt and delivering sub-optimal performance calls for a more agile approach.
Infrastructure-as-a-Service (IaaS) encompasses everything from dedicated server stacks for the largest players to mutualized options giving the newest and smallest entrants into the market a cost-effective way of accessing the best technology.
IaaS also enables you to operate with confidence in the security and reliability of your systems. Given the significant associated cost to the business of downtime, a proactive attitude to monitoring risk is essential. Dedicated MSP support applies the latest technical updates and isolates and examines all working components, to identify and contain the cause of issues as soon as they arise. Pre-emptive management of infrastructure and staying abreast of developments in security can minimize the risk of business interruption and avoid any trade-off between system, security and operations. A managed service can resolve issues before the customer is even aware that there is a problem.
Keeping up with the latest, fastest, most secure hardware on your own is a high-risk strategy. Taking advantage of some or all of the shared infrastructure available through your MSP provides a balance of performance, cost and security that benefits organizations of any size.
Choose Infrastructure-as-a-Service through your Managed Service Provider to reduce risk and stay abreast of the competition.
Business Partnering
An MSP is not simply a provider of staff or equipment, but a fully-fledged business partner adding value to your organization. Whether you are expanding domestic operations or considering a move into new markets, your MSP can support strategic decision making with data-driven insights into risk, reward and best practice.
A global MSP’s experience encompasses a multiplicity of markets from all around the world. They understand different trading conditions, work with a full range of regulatory jurisdictions, and have a depth of cultural understanding that takes many years to develop. They can provide introductions and services in different countries, enabling you to expand your operations with confidence. Their support on the nuances of local regulations can help you to avoid common pitfalls, navigate local exchange requirements, and overcome unusual quirks in regional laws.
Your MSP brings deep expertise in the management of high-performance trading operations that you need in order to maximize the performance of your mission-critical activities. By delegating such management, it relieves internal burden and enables you to prioritize your core business competencies for long-term success.
Use your Managed Service Provider’s experience and insights for data-driven strategic decision making.
Find the Perfect Balance
A Managed Service Provider offers a partnership approach to optimize your trading performance based on the unique footprint of your business. When your strategy requires agile and flexible resources, an MSP can provide what you need in the short or long term. As hardware obsolescence accelerates, an MSP can offer alternative routes to infrastructure investment and mitigate business, performance, and continuity risks. As your partner, an MSP can support strategic decision making, and help you to find the perfect customized balance between DIY and managed services.
Find out more about the role Managed Service Providers play in Colocation of Financial Markets Trading Infrastructure,a new report from industry leading analyst Celent and sign up for our webinar with Celent taking place on March 2.
Tom Lazenga is General Manager for TNS’ Financial Markets business. He is responsible for setting strategy, driving growth and overseeing product development for its global business, which includes mission-critical and ultra-low latency solutions.
