WebFOCUS Application Saves Millions in Costs and Enhances Quality of Service
Snapshot
| Organization The Canadian Depository for Securities Limited (CDS). |
| The Challenge Enable Straight Through Processing (STP), allowing the automated processing of securities transactions to eliminate repetitive data entry, reduce errors, and speed up processing while satisfying customers' corresponding reporting requirements. |
| The Strategy Facilitate custom reporting and data access through the introduction of a reporting technology based on a flexible, browser-based reporting system. |
| The Results A more flexible reporting system that delivers custom reports on demand, resulting in better quality of service and one-time system development savings of approximately CAD$2 million. |
| Information Builders Solution WebFOCUS, Information Builders Consulting. |
The 20th century opened with the sound of horse hooves on cobblestones and closed with the roar of the space shuttle. It was a century in which things got faster, especially transportation and communication. In 1901, important messages were often delivered by steamship or stagecoach, taking weeks to reach their intended destination. Today, even casual communication traverses transatlantic networks in the blink of an eye.
This G-force acceleration is particularly evident in corporate business processes, as managers strive for the much sought after "real-time view" of business activities. For the securities industry, the drive to real-time transaction processing is compelling a complete reengineering of systems and processes. The current challenge is to enable Straight Through Processing (STP). STP will allow the automated processing of a securities transaction from seller through central securities depository to the purchaser. This will eliminate repetitive data entry, reduce errors, and speed up processing.
The Canadian Depository for Securities Limited (CDS) has stepped up to this challenge with a project called CDSX, an information system that processes money market securities and will soon be used to process equities and other debt securities throughout Canada.
"There is a lot of pressure in the securities industry to automate processes and clear transactions faster," explains Ken Wong, assistant vice president of IT development at CDS. "The driving force is to reduce cycle time as the securities industry adopts faster settlement models."
Founded in 1970, CDS is Canada's national securities depository, clearing, and settlement hub. Based in Toronto, with offices across Canada, CDS holds nearly CAD$2 trillion on deposit, and settles up to CAD$200 billion daily for banks, brokers, trust companies, and other financial services firms. The 500-employee company handles up to 45 million securities trades each year.
For many years, this immense volume of transactions had been managed by two information systems, one handling the clearing and settlement of transactions in money market securities and the other handling the same functions for equities and debt securities. According to Wong, CDSX will merge the two systems to create a single platform for settling transactions. To date, all money market and most debt securities transactions are processed on the single platform. Equities and the remaining debt securities are scheduled for conversion in early 2003. An integrated reporting environment from Information Builders will facilitate custom reporting.
"WebFOCUS gives our participants a window into the mainframe so they can easily integrate the data streams with their own back-office applications," Wong says. "It also reduces our cost for creating custom reports and decreases the cycle time for delivering information to participants."
Shopping for a Reporting Solution
CDS participants include trust companies, brokerage firms, and all of Canada's banks (including Royal Bank of Canada, Scotiabank, Canadian Imperial Bank of Commerce, Bank of Montreal, TD Canada Trust, and National Bank). CDS provides these organizations with settlement reports. Additionally, at the end of each settlement cycle, CDS manages the exchange of net payments between participants.
As CDS prepared to upgrade its information systems, software engineers determined that an ad hoc reporting environment would give participants more flexibility. In the past, CDS offered these participants a series of fixed reports created from its mainframe databases. Custom COBOL programming was required to modify reports or respond to requests for specific information. "Instead of simply recreating the existing fixed reports, we wanted to provide an environment that would deliver custom reports and data streams on request," explains Wong.
CDS evaluated reporting software from several vendors, including Information Builders. "The deciding factor was the ability of WebFOCUS to run on many different platforms," Wong says. "We also had concerns about scalability, security, control, and ease of integration with CDSX. In all these areas, Information Builders had the advantage over its competitors."
In short, while all of these tools could create useful reports, CDS knew that reporting was just the tip of the information-delivery iceberg. "The bulk of the project involved building the back-end infrastructure," Wong explains. "The ease with which WebFOCUS can connect to a wide variety of data sources distinguishes it from the other solutions we considered."
Building an Environment for Information Delivery
With help from Information Builders Consulting, the CDS project team took the CDSX Web-reporting project from analysis to implementation in approximately five months. "Information Builders was immensely helpful as we worked through various system issues," Wong recalls. "Most of the WebFOCUS implementation and configuring work was done by our own systems engineers, but we relied on Information Builders' technical support team to answer important questions."
According to Dr. Martin Slagowitz, vice president of Information Builders Consulting, Information Builders consultants have a broad experience base and work well with multi-stakeholder teams. "They add value by bringing experience from working with many technical and security architectures," he says.
Because of the sensitive nature of financial data, the new reporting application needed a robust security architecture. "We decided to integrate this application tightly with the RACF security system on the mainframe," Wong explains. "WebFOCUS upholds the RACF security at the data-element level."
Data is accessed from a DB2 database on an OS/390 platform, while WebFOCUS is installed on the UNIX System Services portion of the same platform. The DB2 tables are updated on a daily basis from the transaction systems that handle the settlement clearinghouse service.
Giving Flexibility to Users
Thousands of users at more than 100 CDS participant banks, trust companies, investment dealers, life insurance companies, regulators, and Canadian and international stock exchanges can now use the menu-driven system to access mainframe data through simple browser forms. "Participants can design, retrieve, and execute reports through their Web browsers," Wong explains. "They don't just grab canned reports off a menu system anymore. They can use WebFOCUS to build their own reports."
According to Keith Evans, vice president of operations services at CDS, the new reporting environment not only gives users more control but also relieves CDS of the responsibility to constantly create and update reports. In the past, this meant writing, validating, and testing COBOL code. Now, CDS simply provides accurate information in the DB2 tables and it is up to the participants how they use it, what reports they create, and how they modify those reports. "Time is critical in our business," Evans says. "WebFOCUS puts much greater control of CDS reports into the hands of our participants. Now our users can build reports they need when they need them, without waiting for someone else to do it for them. This is the direction we need to take."
Most users of the system are business-oriented, rather than analysts or highly technical users. "Essentially, they are using the WebFOCUS point-and-click interface to sort and summarize the data however they see fit and to create their own types of reports," Wong says. "They find the new reporting system to be easier to use and requires much less effort to learn."
Best of all, WebFOCUS allows participants to obtain answers more quickly. "We see the implementation of the WebFOCUS application as the first step in a broad roll-out of data to our participants in accordance with each participant's individual needs," says Ian Gilhooley, chief operating officer at CDS. "WebFOCUS provides a major advance in flexibility for these firms."
Reducing Development Costs
The reporting requirements for CDSX were extensive: more than 500 COBOL reports had to be replaced from the two legacy systems. "We figured it would cost CAD$3.5 million to reproduce these legacy reports and convert them to CDSX, due to the labor intensive methods that are associated with the old technology," Wong recalls. "With WebFOCUS, we accomplished these same results for a fraction of the cost."
WebFOCUS not only reduces the cost of creating reports, it also delivers greater flexibility for CDS participants. In the past, reports were delivered in a rigid format to either a terminal screen or a printer. Now the reports can be delivered in a variety of output formats, such as Word, Excel, and PDF, and they can be viewed or manipulated using familiar tools. And where before it was not easy to do queries, WebFOCUS allows users to extract data from very large data sets quickly and easily.
"Back-office issues, such as trying to get a set of transactions to reconcile, are often very specific," says Wong. "Doing reconciliation exercises becomes much easier when users can search directly through the data and manipulate it using tools such as Excel. WebFOCUS makes it easy to access data and integrate it with back-office systems without writing code."
As CDS works with the securities industry toward Straight Through Processing and in the securities clearing and settlement process, WebFOCUS is helping CDS create a more efficient system that delivers information both internally and externally via a secure, easy-to-use environment. "We're delivering better quality service at lower cost," Wong sum-marizes. "WebFOCUS enhances our service today and prepares us for industry changes in the future."
