Recently I read the fascinating story of “Etak”, the world’s first in-car navigation system. Etak was the brainchild of engineer Stan Honey who was hired by Atari co-founder Nolan Bushnell as a navigator for his boat “Charley” in the 1983 Transpacific Yacht Race, during that voyage the spark of the idea was formed and backed by Bushnell.

Today we take GPS and positioning data for granted, it’s used in everything from sat-navs, to our smartphone making nearby restaurant recommendations or adding location tags on photos. Which is what undoubtedly makes this story so incredible: that Etak provided a sat-nav like capability in 1985. That’s a full 10 years before the GPS system came online and 15 years before it became usable for the general public. No wonder then that when people first saw Etak in operation many thought it was some sort of trick.

I encourage you to read the full story here http://www.fastcompany.com/3047828/who-needs-gps-the-forgotten-story-of-etaks-amazing-1985-car-navigation-system but a short description of this down-right ingenious system is that Honey and his team married the centuries old tried and tested mariners’ technique of dead reckoning with basic realtime data sources – namely a compass, turn indicators and speed/distance measuring device.

Beginning from a known starting point, the system worked by recording the road turns you made combined with the measured distance and used an algorithm to deduce where you must be on the map. For example, from a known start point if you drove 1 mile North, turned East for 0.5 mile, then turned North-East and drove for a further 3 miles those data points can be used to plot your position on the map. And the more turns you made the more data the algorithm had to work with and the more accurate your position. Indeed, so good were the algorithms that parts of the technology are still in use today by Apple in their Mapping App.

The wonderful ingenuity of this system provides an important lesson in the art of the possible.

All too often organisations know the kind of things they’d like to understand but believe they don’t have the data and need their GPS equivalent to be invented first. However, as Stan Honey of Etak demonstrated,  often the data is there already or you can create what you need with relative ease.

In our work at FutureProof usually we find the necessary data is spread across multiple systems, held in spreadsheets or even people’s heads. But this data doesn’t need to remain isolated and can easily be brought together using readily available Analytics tools and techniques.

By adopting a standardised approach to the problem answers can be obtained quickly and cost effectively.

These five simple steps will help you achieve what you need:

  • Produce a clearly defined requirement of the questions that need to be answered.
  • Identify where the data to meet this requirement is located. Typically we try to articulate this through a “systems-on-a-page” diagram showing all of the data touch points.
  • Determine any necessary data transforms or algorithm processing required to turn data into actionable information and insights.
  • Produce a clear solution design covering data loading, processing and presentation.
  • Through reporting and visualisations, get the information into the hands of those who need it, can interpret it or act on it.

The data repositories and analytics tools necessary to deliver these initiatives are increasing in capability at a breathtaking pace, with offerings available to organisations large and small. Larger organisations often call upon technologies and capabilities from their traditional vendors and systems integrators.

But the cloud space is where the real innovation is taking place. Market leader Amazon Web Services provides a powerful end-to-end suite of tools covering data extraction through to visualisations, with Salesforce Analytics and others hot on their heels.

So, it’s very likely that the answers you need are already there in the data you have at hand and it’s never been easier to uncover those answers. Which is a good thing if you don’t want to wait 10 years for the US Military to open up their systems and technologies.

 

 

 

Guest blog by Fred Mann, Associate Consultant at Clarasys

MiFID II is coming and is set to change the way that investment firms do business. The relationships between manufacturers, distributors and customers is set for a major overhaul and, whilst the regulations are still to be finalised, what’s clear is that the way in which firms conduct business will change and these changes will have an impact on profitability.

However, as I describe in this blog firms can take steps now to minimise the impacts on their business.

Firms that are not agile enough (both distributors and manufacturers) will see themselves left behind as the rest of the market races away, with more streamlined and competitive offerings. This move away from the status quo of manufacturer-distributor relations towards a more independent model may seem daunting, even to the most agile and fast moving of firms. This need not be the case as we will now discuss.

MiFID II has a wide range of changes to the conduct of business, meaning that on the whole almost every business will need to make changes of some description. However these changes are internal and operational when compared to the Macro changes of the market space. The major changes coming in with MiFID II come in the form of commission and best execution.

This move has already happened in the retail investing market with the RDR (Retail Distribution Review) of 2012. Following a 2014 report by the FCA which looked at the effect of the removal of commission on the retail market, there is evidence that the RDR has had a transformative effect on the retail investment market. The report states that the removal of inducements had led to more competition in the market, leading to better value for the customer (FCA post implementation review 2014).

The price of the these products has gone down in some cases more than the price of commission on products before RDR. One reason for this is that many products have been simplified to reduce costs, leading to lower charges to customers. Similarly the lack of the inducements has meant that many firms that did not accept commission before RDR are now far more competitive when compared to distributors who did.

A report from CASS Business School from 2013 stated that while the number of advisors fell following the implementation of RDR, that those firms that could prove that they were sufficiently adept at meeting the requirements of a more tech savvy and informed client base are more likely to see a strong demand for their services remaining over time (The impact of RDR on the UK’s market for financial advice).

We see these trends continuing into the commercial market following the implementation of best execution regulation under MiFID II and for firms that stay agile and embrace the changes can thrive, while those who stay still will lose out.

The inducements part of the legislation means that manufacturers can no longer pay commission to distributors in order for preferential treatment when picking products for their clients to invest in. This will fundamentally change the relationship between the two and independant distributors will need to look fundamentally as to whether it is worth their while being independent, as the cost involved in research to prove you are truly independant will rise. However from a customer point of view there is evidence that since the FCA rules requiring more transparency of product prices in 2014 that the price of many of these products have fallen.

On the manufacturer’s side this will mean that distributors will have a legal duty to the customer to pick the best product for them, meaning that products that may have been viable with commission based sales may soon not be worthwhile to keep open. This has the potential to completely change the makeup of the market as many funds as consolidated.

With regards to best execution, the directive indicates that the information given under MiFID I is not adequate and in response the level of detail that must be given when recommending a product. This takes the form of metrics and documentation.

There is also a change to the rules regarding execution only and advisory products. The viability of many products on an execution only basis has also been left in doubt. For example, when it comes to funds, many UCITs that have in the past been execution only will now become complex products and by definition not execution only.

How can we help?

Clarasys and Futureproof’s MiFID II proposition focuses on how you sell your products. With the regulations changing the way financial services products are sold both by distributors and by manufacturers, making sure you are compliant when MiFID II lands will require a reevaluation of both how you market and sell your products and to whom you sell to. Be this through process change, data governance or profit and loss analysis.

As regulatory changes no longer allow for the payment of commission for sale and recommendation of financial products, there will have to be a serious examination of how products are sold and of their viability in the marketplace. Our healthcheck will assess the way MiFID II will change the way you market and sell your products, and assess your risk to exposure to a new, more regulated market. Our experience in process optimisation and lead to cash consulting make us well placed to understand how best to sell products, keeping them competitive and compliant.
MiFID’s changes affecting who can buy what fund and how, as well as the changes regarding the client’s best interest means that more information is needed to know who your product is aimed at and who buys your product.

By looking at the highest performing and most influential products first, it is possible to deliver value and benefit quickly that can become a template to replicate change over a whole product portfolio, be this in process, documentation or sales strategy.

Futureproof’s advanced data analytics examines the products, enabling you to understand who the customers are, the fund’s susceptibility to changes in MiFID and how this will affect the profit and loss of the product. Through powerful interactive visualisations you can model what-ifs and make decisions as to the necessary changes. This can be scaled to address a portfolio of products across the business.

By looking at the content of the directive and the regulation that has already come out regarding the retail sector, we predict that much of the change in compliance following the introduction of MiFID II will be around information and documentation needed for interactions between the the manufacturer, distributor and customer. By making sure that you have the structure in place to execute this documentation when MiFID comes into force in January 2017 you will be on your way to being compliant.

London, 14th October 2015. Clarasys, a leading management consulting firm, in partnership with FutureProof, the enterprise data and analytics specialist, announces an innovative new MiFID II Health Check service.

The framework for MiFID II and MiFIR have been agreed for some time but the implementing measures and technical standards are yet to be finalised, as a result firms know their business will be affected but are unsure exactly what the impacts will be.

The MiFID II Product Health Check from Clarasys and FutureProof is a pragmatic and highly effective solution that provides firms with a thorough view of how MiFID will affect their ability to sell certain products and enable them to run what-if scenarios to determine impacts. And as a result identify the changes required to how they sell the products and the impact on their P&L.

The service is designed to minimise impact on internal stakeholders and quickly provide actionable results enabling firms to plan their response to the incoming regulations.

More information can be found on the FutureProof website here or contact FutureProof on 020 3289 1584.

Chris Hamilton, Director Clarasys, said “MiFID II will have a significant impact across the FS sector. With little over a year to go, timelines for assessing and making the necessary changes to be compliant are already tight. That’s why we think it’s important for firms to act now to understand the scale of change they need to undertake, and begin the process of becoming compliant.”

Geoff Davies, Director and Co-founder of FutureProof said “Drawing on our deep experience working with complex data sets for large financial services firms and our expertise in analytics visualisations these Health Checks represent a highly effective way for firms to plan their response to the new regulations and ensure the impacts are minimised.”

 

About Clarasys 

Clarasys is a fast-growing global consultancy firm based in London.

We believe that there’s a better way to do consultancy. For Clarasys, doing it right means working closely with our clients to forge rapid business transformations, and not only meeting the manifest challenge, but discovering the root cause.

We’re committed to collaboration, working with our clients – rather than merely for them – to ensure that we not only understand their priorities and their goals, but that they become ours too. We’re process driven and tech-neutral, meaning we choose the best tools, resources and approaches to enable our clients to flourish.

www.clarasys.com

 

About FutureProof 

FutureProof are a data-led business and consulting company who work with large organisations to leverage the power of their existing data, bringing together complex information from multiple sources into easily interpreted visualisations and powerful insights that enable decision support, change planning, delivery and ongoing success measurement.

FutureProof provide customers with accelerated routes to business transformation using their Domain Solution Packs, which offer pre-defined data models and analytic information repositories that connect to existing enterprise data, delivering information rapidly via industry standard Business Intelligence tools.

London, 30th September 2015 FutureProof, the leading enterprise data and analytics specialist, announces a major new release to CloudScore, its cutting-edge application assessment and Cloud planning service.

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