Chaos At The Intersection Of Marketing And Compliance - Part II

Sunday, April 1, 2007 - 00:00

In his first article Dave Curran discussed how chaos affects the mutual fund industry in the Sarbanes-Oxley era, and what is being done to turn anarchy into order. In this interview, Mr. Curran tells how other industries are also facing - and responding to - the perils of reporting information in a timely, organized and cost-efficient manner.

Editor: Can you briefly summarize what "chaos" is?

Curran: Chaos is the term used to describe multiple data feeds from a myriad of disparate sources - some real time, some delayed, some raw, some filtered, each operating on its own platform and each only capable of providing a discrete portion of a company's overall communications needs. Chaos may exist in any large enterprise where the company must communicate with the outside world. This includes financial services, pharmaceutical, insurance, and other organizations where the need to communicate at the convergence of marketing and compliance is critical. The need to link with a wide-variety of constituents - consumers, regulators, business-to-business partners, and other governmental authorities - albeit with use of broken technologies or incomplete technologies is what results in chaos.

Editor: Other than the mutual fund industry, what other industries are affected by government scrutiny, accountability and strict reporting requirements?

Curran: We have a growing umbrella of companies. Any publicly traded company has to interface with the government, customers and investors. In terms of marketing at the convergence of compliance and communications are: banking and insurance companies that also sell financial services products, life insurance, disability and long term care; and pharmaceutical companies, including pharmacy benefits management companies, that increasingly have their communications scrutinized by several governmental organizations. (The record keeping and document requirements under HIPAA are very important for those organizations.)

Editor: How are they impacted by chaos?

Curran: They are all similarly impacted by chaos. Ultimately they have to get a published communication in the form of print-out or electronic information in the hands of their constituents - the government, consumers and their business partners. These large organizations tend to have legal departments and marketing arms. On the mutual fund side there are fund accounting groups. On the insurance side there are the state regulatory groups. All of the constituencies within the company are required to participate in how communications are created and distributed but they generally do it in a silo-type fashion. Each hands off its particular piece in a linear fashion to other people within the organization, thus creating an expensive and time consuming process where one hand does not know what the other is doing. Further, there is a wait while legal or compliance perform a review. The chaos is where these people who could be doing productive work are waiting for the other people in the chain.

Externally, companies deal with a wide variety of vendors who do not work off a common platform. Information is pocketed in different places and rarely coordinated.

Editor: Please describe what automation means.

Curran: Automation means the ability to house data in a consistent fashion that is accessible by the users of that information and can be quickly tied together, assembled and then published electronically and in printed form. The typical scenario here would be the ASP (application service provider) model software which is accessible by clients over the web. They can make changes to a document from a library of components within the document and those changes can be shared on one document, 10 documents or 100 documents. Then they have an automatic way to see printed proofs as well as other versions. For instance, mutual funds have a requirement to file compliance documents with the SEC. Using software that would make changes in documents that are consistently handled both through their print and electronic filing requirements can provide quality assurance. Data Communiqué helps aggregate and assemble the textual and financial information into reader usable form that is then publishable. It extracts from storage systems and document management systems to create a document that will be of use for outward communications.

Editor: So Data Communique provides a link from a company to its public?

Curran: Correct. Companies have been linking with their public for many years. The difference is that getting from A to C is very cumbersome for many large organizations today. By using these technologies and continuing to streamline their processes we manage the chain of information management by new technology. Companies must now think about how they communicate with their constituencies in a different way.

Editor: How can the healthcare, insurance and pharmaceutical industries benefit from automation?

Curran: There are several ways. All of these companies have the challenge of reducing costs, increasing productivity, streamlining how they go to market and making sure that they are providing consistent information that is compliant with the laws and regulations that affect their industry. Automation helps them do that by streamlining the process. People within those organizations can make a higher value contribution. They are then able to have audit-ready information which is reviewable by any third party.

Editor: Does this also help with e-discovery?

Curran: One of the side benefits of our system is that communications data is prepared for audit by government regulators. The system dates and time stamps all activity in a company's communications, which is also automatically saved. We use black lining so a user can compare and contrast what was done at different times within the system.

Editor: Are there industries other than those we have discussed that might migrate to automation in the future?

Curran: I would say that with heightened government scrutiny a thing of the present and future, any large enterprise that has both textual and other information that needs to be assembled and repurposed across platforms would be able to use the system. An example would be large marketing organizations with large distributions which need to populate a website, direct mail as well as newspaper advertisements with the same information so that they can repurpose their marketing information across multiple platforms. The large marketing organizations in the consumer products area, those companies that deal with regulated or quasi-regulated products would benefit from this. Other examples are large manufacturers who need to supply information for products across different platforms with their business customers as well as internal constituents.

The beauty of this system is that our existing clients are all global. This information, because much of it is going to be web-based, is usable anywhere at any time. You can be in Greece, Singapore or London and be able to access the information, make the changes and then distribute it where it needs to go around the globe. For example, broker-dealer networks for financial services companies need up-to-date information that is consistent and promises integrity from the core database. They need it in published form to share with their clients - a function currently in use today.

The ASP model we follow means that the communications data is on our servers at remote locations. Most large companies now require that these systems not be embedded in their systems. Our clients do not need to make any software changes or install anything on their computers. All they need is Internet access which takes them into a secure server.

We have also been discussing this product with law firms. Lawyers are recognizing that the old system of physical proofreading of documents is really old fashioned and archaic; any changes have to be hand keyed by typesetters. These proofs then go back and forth in a very cumbersome and costly process. Our system can replace many stages in the documentation process.

Through automation, chaos can be eliminated by reducing costs, increasing productivity and streamlining processes by providing consistent and compliant information.

Please email the interviewee at dcurran@datacom-usa.com with questions about this interview.