Striving for STP - Spotlight: Corporate Actions Automation

June 7, 2005

Abstract

Boston, MA, USA June 7, 2005

Celent presents a case study analyzing how a top ten mutual fund complex undertook a bold initiative to achieve greater STP within select areas of its middle and back office operations, focusing on the automation of corporate actions.

In a new report, Striving for STP—Spotlight: Corporate Actions Automation, Celent examines the challenges that firms face with respect to corporate actions, and provides an example of how one firm successfully implemented a vendor solution to help streamline the otherwise manually intensive process of corporate actions processing and reconciliation.

The initiative involved a thorough review of the Company’s current technology architecture, and the development of a project plan to:

  • move to a more streamlined, flexible IT structure in order to improve operational efficiencies, and
  • accommodate growth and change in the years ahead.

After extensive testing of various vendor solutions, the Company chose SmartStream Technologies’ TLM Corporate Actions solution.

In terms of implementation strategy, the Company decided to take a phased approach to corporate actions automation, focusing first on areas where it had internal control—the data capture, cleansing and scrubbing process to produce a "golden copy" or master record of an action. Additional phases focused on automating the voluntary elections process and entitlement calculations, reconciliation with custodians, and posting to downstream record keeping systems. Since automating corporate actions automation, the Company has enjoyed numerous benefits, including:

enjoyed numerous benefits, including:

  • Improved quality of corporate actions information
  • Greater staff productivity
  • Lower error rates
  • Improved visibility into exceptions

"The Company’s decision to automate processes and rationalize its technology in the quest for STP is indicative of a move among large US asset management firms," states Octavio Marenzi, co-author of the report. "Firms believe that increased STP integration will lead to greater operational efficiencies and reduce costs, thereby generating a positive ROI."

This report details the process by which the Company undertook its STP and corporate actions initiatives. In addition, the final section of the report provides some tips and worksheets to help financial institutions who are considering STP and corporate action automation projects.

The 27-page report contains 3 tables and 8 figures. A table of contents is available online.

of Celent's Institutional Securities & Investments and Retail Securities & Investments research services can download the report electronically by clicking on the icon to the left.  Non-members should contact info@celent.com for more information.

        

Send mail to info@celent.com with questions or comments about this Web site.

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned subsidiary of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America
Michele Pace
mpace@celent.com
Tel: +1 212 345 1366

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81 3 3500 3023

Table of Contents

 

Boston, MA, USA June 7,  2005

Return to report Abstract

Executive Summary 3
Background 5
  Company Profile 5
  The Quest for STP 5
Project Overview 7
  The Game Plan 10
Automating The Corporate Actions Process 12
  Selecting a Vendor 13
  SmartStream's TLM Corporate Actions Solutions 16
The Implementation Process 18
  Synopsis of Phases 19
  Project Outcome 21
Final Comments 22
Objectivity & Methodology 26

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