WS&T: Traditionally, EDM has been focused on setting standards around specific types of structured data. Today, more and more unstructured data is being used. How is unstructured data changing the way you approach managing data?
Bottega: It’s not changing the role; it’s evolving the role. When you think of the responsibility of managing the information in the enterprise, usually the first focus is around the structured data—your database capacity, reference data, analytics. What’s evolving is that there is an awareness that unstructured data is as important to a firm as the structured data. The strategies and methods around archiving, retention and access—they touch on both structured and unstructured data, but it’s important for a firm to have access to both structured and unstructured data as quickly as possible. As the role of data management matures, the scope of it is expanding. If you go back five or six years, I don’t think there was the absence of unstructured data, but it wasn’t a large focus at the time. Today, a mature and holistic approach to data management includes both structured and unstructured data.
WS&T: Which is more difficult, managing unstructured or structured data?
Bottega: Each one has its own unique characteristics. We’re more mature on the structured data side because we’ve been doing database design for two or three decades. Unstructured data hasn’t been a focus for as long, so there are challenges around that. However, they share the challenge of the governance of the data, and the policies and standards that are applied to the data, so that’s consistent across all types of data.
As the role of data management becomes more of a process in the firm, the business units now have a place to go with questions about data. All data is important, but now there’s a place where business units can go to get their questions answered.
WS&T: As you know, big data is the hot and trendy topic today. Is it for real? Is big data technology changing your approach to the way you manage data at BofA?
Bottega: It’s definitely trendy, but I don’t want to speak to the trendiness of big data. I would rather focus on what big data actually is and how you use it to manage large amounts of data and get value. Technology is really advancing in this space, and this is great news. There are many new products on the market that are helping to drill down and find value in the data. But if you step back for a second, large data repositories are important now because we recognize there’s value in very granular data. In the past, perhaps, we were looking at things at an aggregate level. Now we can drill down and look for patterns in granular data, and that’s becoming very valuable to firms, both offensively and defensively.
Defensively, so firms can look for anomalies in financial activities and drill down to transactions. The work that’s being done on these large databases that allows for very specific granularity is important for the health and wellness of the industry. On the offensive side, certainly big data allows you to find patterns in how customers buy and sell or make decisions.
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From a technology perspective, you’ve seen large volumes of data managed effectively in the social space, such as Facebook and Google. They’ve been doing a good job managing the data, and that’s now becoming a part of the financial industry. Taking all of the trendiness away from it, as banks gather more information about activities, having the ability to drill down into the data is more important. And the technology is available to manage the data.
The opportunity that quants and data scientists are creating—the ability to look for opportunities by analyzing data—most often starts in the business units. In other words, the business units ask for the capability to analyze the data, and technology provides the solution.
WS&T: How is big data being used now in financial services?
Bottega: Big data is definitely being used to analyze market risk, as well as being used to analyze new business opportunities. That’s consistent across the industry.
WS&T: What new business trends or opportunities will change the way firms do business?
Bottega: The regulations put forth by Dodd-Frank have very significant data implications. As I mentioned, it’s about more granular data and specific data to how the markets move. As far as new technologies, you’re seeing big data and more advancements will continue. The market, in both business and technology, is realizing how important data is to their operations, and that’s a good thing for our industry.