In an October 19 Risk Management Knowledge Exchange article, Howard Rubin says that banking and financial services is the most data intense sector. In fact, he said that data costs in that sector account for 92 percent of the cost of doing business. His next article – from Wall Street & Technology – explores the growing need for technology in the financial sector even while revenues remain steady.
Here is a short excerpt:
In 2006 the average financial services company required 1.29 million instructions per second (MIPS) and .53 physical servers to support the processing needed for each $1 million in net revenue. At the close of 2010, the 1.29 MIPS had increased by 38 percent, and the servers increased by 46 percent. During the same period, net revenue grew at a far slower rate (less than 19 percent). In general, the need for computing power is growing two- to five-times faster than revenue.
Consider the need for computing power (and services) relative to U.S. government projections of national GDP growth, which is estimated to remain under 3 percent through the end of 2014, and it is clear that technology intensity growth will outstrip all other economic indicators. With this knowledge, technology leaders must act to harness the promise and power of technology to “bend” the business performance curve.
Read the entire article at Wall Street & Technology.