ECM feature: Taming the mountain

With financial institutions increasingly looking to cross-sell or up-sell during the recession, modern business practices creating more unstructured data, and regulators demanding more information post-crunch to prove liquidity and sound judgement, Duncan Jefferies investigates if traditional enterprise content management (ECM) systems can cope as the data load ramps up and the electronic mountain grows

Financial institutions have long had to deal with a paper mountain. But in recent years an electronic mountain has sprung up alongside; thousands of emails, SMS messages and application documents now pile into their servers each day. Add the data from social networking sites and other Web 2.0 tools to the mix, and the increased demand for record keeping or monitoring from regulators, and it's easy to see how an organisation can quickly lose track of what is being stored and where it can be found.

"While revenues and total business has shrunk recently, data continues to grow at an alarming rate," says Donald Butler, enterprise account manager at EMC Documentum. "There's more unstructured data today than there has ever been in the past."

According to research by AIIM, a trade body organisation that provides enterprise content management (ECM) education, research and best practice guidelines, electronic records are twice as likely to be unmanaged as paper records. In addition, only 56 per cent of organisations have a procedure in place for putting a freeze on electronic records in the event of pending litigation.

The latest ECM tools aim to alleviate this data burden by capturing, managing, storing and preserving all the content relevant to a bank's operations. Doug Coombs, an information on demand advocate at IBM, believes ECM technologies can help companies refocus their efforts on the customer and become more operationally efficient. "In the case of financial institutions, it allows them to get a much more strategic view of their unstructured information, which is often spread out across the organisation."

A robust ECM strategy can also help organisations better adhere to both current and future regulations. "It allows you to get rid of the data that you don't need, and put a policy around the data that you need to keep," adds Coombs. "The analytic insight available means you can ensure you comply with your own internal rules, as well as those outside the organisation."

Since the financial crisis, reducing the costs associated with processing large amounts of paper documentation has become an even greater priority. As such, many banks and insurers now use an automated process to handle incoming data. "It's still not as widely used as it could be," says EMC Documentum's Butler. "But with the increased focus on risk management and operational procedures we're now seeing, that's likely to change. It's a better and more reliable way than using people to ensure company policies are being followed."

As well as finding the information relating to a specific transaction, for example, an ECM system can also be used to set certain parameters - i.e. to prevent its deletion by a data de-duplication application. This kind of control is key as far as compliance and litigation is concerned. "To demonstrate compliance you need to prove that records are true, accurate, and haven't been interfered with," says Mike Davis, a senior analyst at the Ovum consultancy. "All the information in a company can be regarded as corporate memory. If that is in an inaccessible format - semi-structured content such as emails and letters - and you're not pulling it together, then there is a potential risk there." You could, for instance, get fined by the Financial Services Authority (FSA) for a lack of proper controls.

The capture of incoming documents at branch or office level is a "fairly well developed" process in the majority of banks and insurers, says Doug Miles, UK managing director, AIIM Europe. "People are also starting to gear their customer relationship management (CRM) systems so that they pick up incoming emails from customers," he adds. "Whether they then join these up properly into a common repository, or whether they just become part of the CRM email archive, is the main issue."

The rapid growth in the use of social networking technologies among both company employees and between customers and financial institutions may create a further excess data headache in the future. "[Social networking] plays to the ECM agenda, which is about sharing content rather than just sending copies back and forth," says EMC Documentum's Butler. "What firms have got to do is deliver that usability to customers or internal employees, but under the relevant security controls."

The recent spate of mergers and acquisitions in the financial sector, caused by the banking crisis, has also impacted upon ECM strategies. Migrating data from one system to another can be a fairly lengthy task, but one that is essential if legacy data issues are to be avoided. "It also creates an opportunity to take a breath and do some due diligence," says AIIM's Miles. "I know one bank that had 24 different ECM systems in place at one point." With Lloyds currently absorbing HBOS' operations; Santander incorporating Alliance+Leicester and some of Bradford & Bingley; Barclays bits of Lehman Brothers; and Bank of America Merrill Lynch, to name just a few of the mergers caused by the crash, there is certainly enough integration work out there.

Although ECM systems were once the preserve of large multi-national corporations, many small and medium size enterprises now have some sort of ECM function in place as well. The main issue SMEs must contend with is what aspects of ECM they wish to utilise. As Ovum's Davis says, ECM is a "Lego box" of components that can be bolted together to provide the type of application that best supports business processes. "The big question then is obviously the cost. That comes in two forms: complexity and size. Even small financial institutions may have very large volumes of data to contend with."

Using standards to aim ECM
Financial firms are now looking more seriously at the concept of information lifecycle management (ILM) - i.e. siphoning data that is little used off to a cheaper platform. "There's evidence that people are now coming up with better archiving strategies, driven by the recession," says EMC Documentum's Butler. "ILM is one way in which you can ease the pressure of provisioning for an increase in data."

The Content Management Inter-operability Services (CMIS) standard aims to allow the sharing of information among disparate content repositories and ensure the interoperability of ECM applications. Organisations can access and sort information from a single interface wherever it happens to be stored. IBM's Coombs says past attempts at ECM standards have tended to be very technically orientated: "How do I glue this repository with this one? How do I allow an office productivity tool to connect to a repository? What's been missing are business standards around how you define a classification scheme, how you connect processes together, and how you define retention periods around certain types of information. CMIS may be able to help in this regard."

Microsoft, with their pervasive operating system, office tools and SharePoint software are now a big player in the content management market. "But there is a risk that people are potentially misusing their systems," says EMC Documentum's Butler. "The question mark comes when you want more advanced functionality. You need to start putting in proper records management, lifecycle management and other business processes in place. SharePoint is not designed for that. You can certainly make rapid progress with it. But if you make rapid progress with a tool that hasn't been designed for global rollout, then you might come unstuck."

Ovum's Davis claims many ECM vendors use SharePoint as an inter-mediate step between the front-end application - Word or Excel say - and the backend system. "It could go into MOSS [Microsoft Office SharePoint Server] as a holding place. Items that need to be records managed could then be moved into Open Text or whatever system was working at the very back-end without the user realising."

SharePoint 2010 has greater records management capabilities than its predecessor, which Davis believes could make it a disruptive technology. "It's still not full records management. It doesn't have all the transactional, workflow and other business process capabilities that you'd get from a full ECM system, but it's getting there."

AIIM's Miles warns that financial institutions using SharePoint could "end up with two completely isolated parallel tracks going on. One is the compliant, regulated, authorised document management, content management, records management suite; and the other is SharePoint.. We find that 57 per cent of companies have no policy that has been approved at corporate level on where SharePoint will and won't be used. That is a recipe for chaos."

Clearly more rigour is needed with regards to how companies treat their unstructured information. But as IBM's Coombs says, "you could argue that there should be rigour around how you treat all of your information." With a flurry of new regulatory legislation just around the corner, the rise of Web 2.0 tools for communication, SharePoint, multi-channel integration work, and the need to share data to increase revenues, it's a point all financial institutions would do well to bear in mind as the mountain of data continues to grow.

Case study: Standard Life saves £1.1 million with EMC's scanning solution
Standard Life has increased the efficiency of its document processing by standardising on an intelligent document capture solution. The document services department is the main entry point for all paper correspondence from customers. Over two million items are received each year, with 10 million pages scanned.

A staff of 60 was manually sorting, scanning, and distributing mail across 16 processing areas. Scanning systems and software differed for each area, requiring significant training resources. Also the legacy imaging system's limited functionality made it difficult to improve performance. To rectify this, Standard Life chose the EMC Digital Office Solution, incorporating the Captiva tool. Document services now captures 35,000 scanned images from the 4,000-6,000 mail items received daily. Images of form letters, applications, non-standard documents, and other items are automatically classified with matching of templates and key phrases, full-text optical character recognition, optical mark recognition and other techniques.

Indexing criteria are extracted and validated against existing repositories for accuracy. After indexing, extracted data is then attached to document images, which are processed and sent to the company's workflow system for routing to the correct departments. Now only two per cent of scanned mail is not accepted and handled manually, compared with 100 per cent with the previous manual system. This should save the company £1.1 million per annum.

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