Gartner Says Business Activity Monitoring to Drive Technology Innovation for Investment Services Firms

Analysts Examine the Future of IT in Investment Services During Gartner Financial Services Technology Summits in Boston and London

STAMFORD, Conn., August 2, 2006 — The most significant change in the business priorities for financial services CIOs is the rising importance of “faster innovation," and business activity monitoring (BAM) is the most significant technology for achieving this goal, according to Gartner, Inc. BAM drives this innovation by detecting events, filtering them and triggering business process management (BPM) solutions.

In the Gartner report “Hype Cycle for Investment Services, 2006," Gartner analysts identify technologies that are special to investment services in some way, because they are unique to this industry or because they are applied in a different manner within this marketplace.

“Business activity monitoring is the only technology in the Gartner Hype Cycle rated as high impact (enables new ways of performing vertical applications that will result in significantly increased revenue or cost savings for an enterprise) and capable of reaching maturity in less than two years,” said David Furlonger, managing vice president at Gartner.

“The investment services industry is in the forefront of adoption of BAM and, in particular, low-latency complex event processing (CEP), given the need of some investment services firms — such as hedge funds and others that perform a high volume of automated trading — to analyze high volumes of streaming market data and transactional flows, often with sub-second latency,” said Mary Knox, research director at Gartner.

While approximately 25 percent of investment services firms have some form of BAM in production, these are often relatively simple implementations involving single event streams and less-time-critical applications. “High growth in electronic trading, burgeoning volumes, sources and need for analysis of market data streams, and regulatory compliance demands will drive rapid adoption of more-sophisticated BAM and low-latency CEP,” Ms. Knox said.

As the investment services sector continues to undergo a massive change, investment services firms with the power to invest strategically in new architectures, messaging standards, applications and processes will grow faster than midsize firms (which will disappear) or small firms (which must exploit technology tactically to establish superiority in specialist niches).

“Global investment services firms will no longer be magnified versions of small investment services firms; they will have distinctly different business models, and their IT decisions will reflect this disparity,” Mr. Furlonger said. “Sometimes, this will mean that the emerging technologies they choose will be quite different; for example, grid computing may only be a realistic option for large investment services firms. Other times, it will mean that they access the same technologies in different ways; for example, business process outsourcing (BPO) deals and business process networks may give small firms access to technologies they could never build in-house.”

More detailed analysis on the key technologies for investment services firms will be presented at the Gartner Financial Services Technology Summit, taking place August 28-30 at the Marriott Boston Copley Place in Boston and September 25-26 at the Hilton Metropole Hotel in London. The Gartner Financial Services Technology Summit is the most comprehensive event of its kind designed exclusively for financial services industry IT executives and their business counterparts with a keen interest in the business value of IT. This forum hits the critical spot between strategic planning and tactical advice for IT organizations in banking, investments, and insurance, and looks at the state of IT in the financial services industry, a view of the future, what it takes to be prepared, and the complex IT issues while laying out the manageable actions needed for success.

For complete details on the Boston Summit, please visit www.gartner.com/us/fstech. Members of the media can register by contacting Christy Pettey at christy.pettey@gartner.com.

For information on the London Summit, please visit www.europe.gartner.com/fs. Members of the media can register by contacting Laurence Goasduff at laurence.goasduff@gartner.com.

The “Hype Cycle for Investment Services, 2006” report is one of 78 hype cycles released by Gartner in 2006. More than 1,900 information technologies and trends across more than 75 industries, technology markets, and topics are evaluated by more than 300 Gartner analysts in the most comprehensive assessment of technology maturity in the IT industry. Gartner's hype cycles assess the maturity, impact and adoption speed of hundreds of technologies across a broad range of technology, application and industry areas. It highlights the progression of an emerging technology from market over enthusiasm through a period of disillusionment to an eventual understanding of the technology's relevance and role in a market or domain. Additional information regarding the hype cycle reports is available on Gartner’s Web site at http://www.gartner.com/it/docs/reports/asset_154296_2898.jsp.

Contacts:


Christy Pettey
Gartner
+1 408 468 8312
christy.pettey@gartner.com

Laurence Goasduff
Gartner
+ 44 1784 267 195
laurence.goasduff@gartner.com


About Gartner:
Gartner, Inc. (NYSE: IT) is the world's leading information technology research and advisory company. Gartner delivers the technology-related insight necessary for its clients to make the right decisions, every day. From CIOs and senior IT leaders in corporations and government agencies, to business leaders in high-tech and telecom enterprises and professional services firms, to technology investors, Gartner is the indispensable partner to 60,000 clients in 10,000 distinct organizations. Through the resources of Gartner Research, Gartner Consulting and Gartner Events, Gartner works with every client to research, analyze and interpret the business of IT within the context of their individual role. Founded in 1979, Gartner is headquartered in Stamford, Connecticut, U.S.A., and has 4,000 associates, including 1,200 research analysts and consultants in 80 countries. For more information, visit www.gartner.com.