Wall Street Letter VOL. XLV, NO. 36 - December 2013 - Page 18

DECEMBER 2013 COMMENT Benchmarking and maturity assessments Gavin Kaimowitz , director at Sapient Global Markets, explains how benchmarking and maturity assessments can position your project for success W 18 ith data sitting at the heart of all activities across the capital and commodity markets, market participants, regulators and intermediaries alike need to gain a clearer, deeper understanding of their data management practices across the enterprise. There is a lot we can learn from data. From industry best practices to most common problem areas large firms face with managing data, there is tremendous value in identifying how the industry is addressing the challenges big data present. This piece will discuss improving data management processes through peer benchmarking, the benefits of sentiment-based assessments, the Capability Maturity Model (CMM) an industry recognized measure of maturity and one of the tools used in self-assessment - and where data visualization can help. WHAT IS PEER BENCHMARKING? Benchmarking is a continuous, systematic process used to evaluate and compare the capability of a team or the organization as a whole against its peers and/ or industry standards in order to optimize processes. To benchmark itself externally against its peers, an assessment must be performed based on an industryrecognized measure. During the assessment process, the analysis uncovers the current state of maturity of processes, governance, and technology, allowing for the organization to determine the steps it must take to improve and defines how to measure progress. When going through the benchmarking process, many firms tend ask too many questions and review excessive amounts of documentation, giving them more data than they need to get the answer they seek. By taking a sentiment-based approach to gathering and interpreting data, firms can capture the opinion, attitude and/or perception of the user and further reinforce the value of the capability maturity exercise, by asking the right people the right questions. This approach allows firms to quickly uncover areas of strengths and inefficiencies, allowing for stakeholders to make informed decisions to improve efficiencies. THE CAPABILITY MATURITY MODEL The Capability Maturity Model (CMM) is an industry-recognized measure of maturity and one of the tools used in self-assessments. In its simplest form, a maturity model is a matrix of five levels of maturity that describes how well the practices and processes of the organization function. By simplifying the questions being asked across the firm when conducting the sentiment analysis, key pain points can be identified and acted on much more quickly. CREATING AND RUNNING A CAPABILITY MATURITY ASSESSMENT Once the CMM matrix is defined and the assessment has gained buy-in from all participants, running the actual exercise is very straightforward. To achieve the most accurate and comprehensive result, it is critical that key stakeholders across all business lines record their perception of the current state as well as their perception of future goals and priorities. Results are scored and used to define measures of success to institute subsequent actions and achieve business goals. In the final stage of assessment, stakeholders will often define a vision statement that will guide the formation of the foundational layer of information capabilities and responsiveness. QUICKLY GAINING INSIGHT WITH A HEAT MAP A useful tool that allows executives to identify the most pressing issues and make quick improvements is the heat map. A heat map is a graphical representation of data where the values collected are represented in a two-dimensional matrix by color. When used as a strategic tool, a heat map allows executives to quickly pinpoint the highest priorities, most pressing issues and the areas that can be quickly resolved with relatively little effort. Doing so awards them more time to tackle the firm’s bigger and more complex initiatives. CONCLUSION Firms today operate in a rapidly changing regulatory and market environment, and in an attempt to adapt, many run an array of change programs across departments and divisions. These programs are often initiated without a preliminary self-assessment. Without the data from an initial self-assessment, key program stakeholders often lack a common understanding of the gaps and inefficiencies. B enchmarking and maturity assessments are an easy step that can help organizations position projects for success.