The Cline Group, a capital markets consulting and training firm, has released a white paper that examines the reasons why risk and performance measurement systems failed to predict last year’s financial markets meltdown. The paper, “A New Vision on Enterprise Data Management,” points to inadequate and poorly structured EDM systems, which created low-quality data that fostered inaccurate securities valuations and faulty measurements of risk and liquidity.

The paper details the reasons why virtual data management, which makes use of XML and high-performance messaging infrastructure, reduces latency, and makes data available to business applications in real time, improving valuation accuracy, risk management, and reporting. Virtual Data Management distributes data management efficiently and cost-effectively integrates data from disparate applications, overcoming the challenges presented by multiple information silos.

The paper provides as an example how one vendor, CorrectNet, a managed services provider of client and risk reporting for global market participants, employs a virtual data model by dynamically structuring disparate data, standardizing all data to XML and normalizing the data to the required structure and schema. The process then applies rules-based exception processing and enriches data according to service needs.

The paper can be downloaded at: http://www.billcline.com/edm_new_vision.pdf.