The Game Changer
Date: Friday , December 03, 2010
Pershing’s recent workstation NETX360 is hailed as the iPhone of the financial technology industry, which can be accessed via smartphone. It has released NetX360 apps for the iPad as well. By the looks of the developments, in a year or two, there may even be a NetX360 App Store.
Technological innovations under way at Pershing (a subsidiary of BNY Mellon, the nation’s oldest continuously operating bank, and one of the world’s leading providers of securities services, which has approximately $831.3 billion in assets held in custody) today could propel the firm into a technology leadership role in both the broker-dealer and RIA custody spaces. Behind these break through changes which is impacting the industry is Suresh Kumar, its CIO. Versatility, sharpness and above all an intuitive power which comes from a deep sense of technology and the understanding of business, with which this CIO spearheads the technological ecosystem at Pershing is putting the pressure on competitors to try and meet or exceed what Pershing has to offer.
A keen observer of the technology spectrum, Kumar recognized that mobile computing is emerging as a viable alternative to how people conduct businesses. He says, “People are becoming more mobile and information and accessibility a click away or at finger tips is what people are tuning to these days. So we are taking advantage of that global platform, and have our main product available in iPhone, iPad, Blackberry and Windows mobile”.
This edge which Kumar brings in to stay at the technology curve and to stay ahead of competition has helped Pershing in many ways. The of Sept. 11 hadn’t even happened yet, but Kumar, realized that his business-continuity efforts had to be more efficient. Though he had disaster recovery systems in place, what irked him was that it could be as long as 24 hours before things were back to normal. That was far too long for his liking, given that Pershing, provides global correspondent and prime-brokerage services to more than 750 institutional and retail-financial organizations, registered-investment advisors and managed-account programs. He engaged IBM to help with a major overhaul of its business continuity/disaster recovery capabilities.
Pershing had established two data centers and installed data mirroring and data replication. This effort needed a lot of investment and finally when the Sept 11 attack happened, Kumar’s long term vision proved right.
Today he is observing the three major trends evolving in the technology space- virtualization, cloud computing and open source technologies. “I think the changes that are taking place in these three spaces are rapid and so we are trying to figure out how we take advantage of these trends” says Kumar.
He has articulated his thoughts on these trends very eloquently.
Virtualization - Traditionally large companies have their own data centers and they also installed hardware and the software and everything that you need to create your solution is all in your data center. The good news is that in terms of performance and in terms of security, it’s pretty good. But in terms of the time to market and in terms of overall cost, it is not that good and from a technology selection point of view quite laid back. So, virtualization really makes it easy to deploy the services and it dramatically reduces the time.
Cloud computing - Cloud computing allows you to be able to get services on a variable cost basis so, you need to pay for only what you use and if you no longer need it, you don’t need to pay for it anymore. That is pretty appealing. As well as if you are starting out a business then you don’t need to spend a lot of capital to have what you need, you can just leverage this and that is a business goal. There is an alignment between the performance and expense which is good. So he thinks the cloud computing concept and the services that are there is pretty impressive, but for large companies their comfort in using cloud computing for critical resources is a challenge.
Kumar has donned multiple roles in his career. This IIT, IIM alumni has been often asked by his peers and media about venturing into entrepreneurship. But Kumar says he has lived the roles of an entrepreneur as the CIO of Pershing. Kumar is not only Managing Director, Chief Information Officer and a member of the Executive Committee for Pershing, where he is responsible for application development, program management, process assurance, project management, quality assurance and technology product management but is also the Chief Executive Officer of iNautix Technologies, a technology affiliate of Pershing that provides offshore development services, and Chief Executive Officer of iNautix (USA), a technology affiliate of Pershing that provides technology products and services to the financial services industry.
Kumar feels that the role of the CIO has evolved to be more complex and hectic. More and more companies today have decent amount of exposure to the internet and there is a lot of changes taking place in the technology space. Hence CIO’s globally faces three major challenges:
1st Challenge: One of the top priorities is information security. We need to make sure not just people know how to record, and how to scale and how to have a highly performing system, but they also need to make sure the system is secure. And he believes the information security is one of the biggest challenges.
2nd Challenge: The other challenge he say is technology obsolescence. The good and bad is that there is a lot of disruptive innovations that are taking place and it is an exciting time for technologies today because there is something new, better and cheaper. But the bad news is that it is not like we can just cant suddenly get rid of what we have and get something new to replace what we have. So he feels the CIOs need to figure out on how to balance it out so that you can handle technology obsolescence in an effective manner and at a reasonable cost.
3rd Challenge: The third challenge is in a way related to, how do you protect your technology investments. If you don’t have the right architecture which allows you to be able to replace components of things at a time or specific services at a time it becomes a challenge. So Kumar thinks that is another focus that you ought to have the right architecture, so that you are able to not be constantly required to change, but you can preserve what you have and incorporate with something new so that you are able to protect your technology investment to get a better rate of return on the technology investment.
As we signout of this conversation, he is ready and all set to venture into his next mission but more personal in nature-Biking for 200 miles for a noble cause. Here also, his ways of making it a success is similar-set a goal, focus on your mission, work hard and work with passion