The SEI and the Enterprise Data Management Council (EDM Council) announced on July 7 a strategic partnership to create a new Data Management Maturity (DMM) Model for the financial industry. The new model will be designed to define the components of data management at the specific business-process level so that financial organizations can assess themselves against documented best practices.
Recent catastrophic events in financial markets have reinforced the importance of data content management as both a mechanism for market oversight and as a strategic business priority for financial institutions. Precise and comparable data are recognized as the core factors of input for virtually every business process within the financial industry. They are also the essential ingredients for systemic risk analysis which is a process that is dependent on the ability to identify, link, value, and model multiple factors of input in ad hoc ways.
The SEI and EDM Council will collaborate on development of this new model to help the financial industry become more proficient in their management of data and to provide a consistent and comparable benchmark for regulatory authorities in their efforts to control operational risk. Using the foundational process areas found in CMMI and the CERT Resiliency Management Model (RMM), the SEI and EDM Council will collaborate to move the DMM to a framework and accompanying assessment methodology that can be adopted by financial organizations worldwide.
“While many executive managers conceptually understand the importance of data management, there are very little practical experiences and no proven operational route map to guide them on their journey,” said Mike Phillips, manager of CMMI initiatives at the SEI. “With our experience in developing capability models and EDM Council’s extensive knowledge of data management, we are confident that the new model will serve as the much needed roadmap for financial institutions.”
“The Data Management Maturity Model initiative will provide a measureable benchmark for evaluating the efficiency of data management practices, the maturity of operational integration, and the establishment of essential standards and data definitions,” said John Muholland, global head of reference data for RBC Financial Group and a director of the EDM Council. “The DMM will not only help guide and measure a firm’s providence over their own data quality processes and governance structures, it will provide consistent criteria to measure the services of external providers.”
Michael Atkin, managing director of the EDM Council, agreed that efficient business operations and effective oversight are compromised when data management processes are managed on a manual and reactive basis.
“All too often, data exists in unconnected spreadsheets using multiple formats and inconsistent definitions—and integration is frequently done tactically in response to immediate business requirements,” explained Atkin. “As a result, data quality varies widely among business units, data failures occur with regularity, and cross-functional views of risk are difficult to obtain.”
To assist in their research, development and piloting efforts, the SEI and EDM Council are seeking input from financial organizations so that the research can be applied to real-world situations.
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