One of the myths of the financial industry is that its members are innovators of sophisticated technology. True, some are, occasionally, but most aren't. They are great at spending huge sums of money on sophisticated technology developed by software and computer companies, data vendors, and platform developers. That's why vendors and technology companies love to do business in this industry. That is where the money is. And that is where and why all new things are first vetted.
That's all the more reason why the financial industry should be at the tipping point of major leaps in technological deployment for cost efficiencies and infrastructure re-engineering, but it isn't -- nowhere close. The financial crisis should have been the root of that change. Aggressive regulators have been the change agents, but the legacy mind set and competitive nature of the industry's business models are holding back progress. Money is being spent on front-end, revenue-driven applications, not infrastructure rebuilds. That's what you get when budgets are driven by revenue-driven silo owners.
The technology innovators of today, the Silicon Valley and Silicon Alley entrepreneurs, have given us new infrastructure platforms: all-on-all-the-time plug-in cloud computing; globally pervasive big data networks; massively parallel computer power; multiple data stream computational processing power; and speed-of-light communications. Unfortunately, this technology is being used incrementally at the front ends in silos, not strategically for wholesale re-engineering, as is needed. Why not? Infrastructure rebuilds are the sole province of the CEO and the C-suite executives. That's where the silos come together. The rebuild is long overdue. Regulators have taken the first step, but they need direction. The CEOs need to step up.
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