Benefits

Four major areas associated with interoperability and integration:

Application Interfacing and STP

Data Integration

Are areas where I-Format products will reduce cost and operational risk.

Application Interfacing and STP

You are installing a new application and must pass some data to another application. Previously, the only choice has been in the transportation mechanism, e.g. custom server, middleware server/broker etc.

Most application data definitions are obscure, often being based on database definitions designed for easy storage and retrieval of data by computers; not for understanding.

By using middleware and associated mapping tools, the costs associated with the development and maintenance of interfaces can be controlled.

This means that the most significant outlay is now for expensive analysis of the application data, in order to translate it from one obscure format to another.

Once completed, the data is available to other users only in one of these native formats.

A few months later, when it is decided to transfer the same data to another application, the analysis of the source data is usually redone, compounding costs.

Many organisations will map data from one application to several other applications in this manner, multiplying the risk of mismapping.

When the source system changes, or is replaced, the resultant connection work is time consuming and costly.

Now there is an alternative. I-Links publish data from industry leading applications and can be inexpensively created for in-house applications. All I-Links publish in I-Format, which provides a clear, cross-market and integrated publishing format.

For custom built links there is no repeated analysis of obscure data formats and with two I-Links transferring data between applications, your interfacing needs are met.

Data Integration

Using native application data formats or fragmented B2B standard formats for connecting systems in narrow vertical markets with disregard for cross-market data integration is the norm in international financial markets.

I-Format uses the same basic data component definitions to fully describe all types of financial data, across all markets.

So when your IT support is asked to complete complex, across the board projects for credit risk, compliance, head office reporting, statutory returns, security, etc., the task of data integration is vast.

Now, by publishing in I-Format, the data integration work is already done.

Support staff can concentrate on the reporting requirements, rather than struggling to make sense of numerous kinds of data definition.

We believe that extensive use of I-Format and I-Products could reduce your interoperability, STP and integrated reporting by up to 50%.

We can help you make the calculations for yourselves.

Avoiding the usual spaghetti of systems interaction and know that a clear published format for all data will reduce operational risk, something to think about in relation to the Basle II Accord.

Operational Risk Management

Some questions to be answered in respect of Operational Risk Management within international financial markets.

Does everyone within the enterprise have a full understanding of what each financial transaction and financial product is?

Some historic operational failures, including Baring Brothers, have arisen because not everyone within the organisation has had a full and accurate understanding of a particular financial transaction or the underlying financial products. ‘Financial Exchange Theory’ (FET) provides a methodology for analysing all types of international financial products and transactions, so that all responsible parties have a common understanding of the enterprise business. I-Format provides a single publishing data format which implements the common FET view for the whole enterprise.

Is the data describing a given financial transaction always accurately and consistently transformed each time it is passed to a support or reporting system?

Each system processing, analysing and reporting on your business has its own unique data format. As many of these formats are designed for the efficient computerised storage and retrieval of data and not understanding, making sense of the data is a time consuming and risk prone task. Translating and publishing transaction data from a source system once, in I-Format, rather than many times to numerous target formats, greatly reduced the likelihood of miss-mapping and consequent reporting failures.

Can a processing exception be corrected promptly?

Identifying an exception is the first step to enhance through processing; understanding how to correct it is the critical step. Transaction data presented for correction must often be understood by two or more users to identify where and why a problem has occurred. Typically, users are only familiar with the data format pertaining to their local support system, which can prove a barrier to correction. Seeing data in I-Format will bridge the gap in understanding between users and speed correction.

Is data correctly aggregated for cross market analysis and reporting?

There are numerous and critical cross-market reporting areas, such as statutory reporting, compliance, security, credit risk etc., which are not always addressed fully or in a timely manner. As the same data component definitions are used for every market, once published in I-Format, data can instantly be aggregated without further analysis, ensuring timely and accurate cross-market reporting and analysis.

I-Format will not only add value to any operational risk management infrastructure you implement, it will also reduce, in itself, the operational risks associated with numerous and fragmented support systems and data formats.

Service-Oriented Architecture SOA

We look to SOA because both client/server and Middleware have failed us. An enterprise has hundreds of computers on desks and in departments, running vastly disparate applications from many vendors. Middleware exists to get data from one place to another and ultimately gather data for integration

Unfortunately, in the financial world, the cost of middleware, interoperability and integration now costs more than the applications themselves.

SOA holds out the hope of reducing the number of applications by providing a single service, enterprise-wide, where duplicate applications previously existed.

However, all SOA enabling environments still offer the opportunity to mix and match services from different vendors for use throughout the enterprise. Unfortunately, when vendors offer fifty web services instead of one application module, the cost of web service integration will be increased even more and institutions will eventually declare that SOA is dead and some other technical integration platform will be the new silver bullet.

Whether an institution implements monolithic, client/server, middleware or SOA, making sure the data format is consistent by using a common data format will be the only cost effective way of implementing SOA.

Another web related technology, the semantic web ontology, offers the basis for a solution to the data interoperability and integration challenge.

The ontology utilises XML dialects such as RDF and OWL to record data definitions and relationships. Inference engines then convert data from one format to another. Indeed an ontology is also used to store business rules, which can make the services themselves transportable between technical environments.

The open “Financial Exchange Framework” is the only generic ontology for describing all international financial transactions and products. Because the same generic definitions are used for all markets, cross-market data integration is guaranteed.

The Financial Exchange Framework supports the conceptual model “Financial Exchange Theory”, which defines financial transactions and products in terms of exchange agreements (whether at formal Exchanges or over-the-counter).

The Financial Exchange Framework provides the basis for the construction of an enterprise-wide publish and subscribe data format. Armed with an understanding of the conceptual model, analysts can produce definitions based on the framework which will always be compatible and provide data integration.

The proprietary I-Format, from Ifip Ltd, is a full implementation of Financial Exchange Theory and can be used as an enterprise-wide standard. The format is available in XML variants such as DTD, DTS, RDF and OWL, depending on the institution’s level of technology.

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