It's estimated that more than 90% of the records being created and managed today are electronic. The overwhelming growth of electronic content - most notably e-mail with attachments, instant messages, and images, - the management of electronic records, specifically those classified as unstructured, has become an increasingly critical issue for financial firms and service providers. Amplifying this unparalleled ramp-up in unstructured electronically stored information (U-ESI) are two startling statistics:
• As much as 50% of U-ESI is stored longer than it needs to be for business, regulatory, or legal purposes, with much of this content being retained indefinitely.
• For those firms that keep track of duplicate content, which is difficult if not impossible to do for most, duplication rates for U-ESI run as high as 20:1.
• Firms are increasing their storage capacities by 50%-120% per year to accommodate the growth and retention of U-ESI.
• U-ESI now accounts for up to 40% of all enterprise records.
Given this environment, financial institutions are spending millions and millions more each year on IT, operations, legal, and third-partly services to manage this environment. In some firms, archive and storage costs alone top $100-$300 million each year. Costs and risks are projected to aggressively and steadily increase and productivity decrease if firms stay on their current paths. Many believe that the costs are unsustainable, and are looking for improved technology and business processes to address the problem.
In part as a result of recent financial and federal regulations, financial organizations have been forced to implement expensive infrastructure to manage U-ESI. The problem is these systems turned out to be stopgap measures designed to address a problem that has grown to unforeseen proportions. On the technology side, the growth of U-ESI within organizations is choking current systems and exposing organizations to hidden risks. Existing systems and processes don’t scale well, performance is slow, and they tax information discovery efforts with burgeoning and unnecessary operational and legal costs. Some estimate that firms who choose one-off solutions for each legal or regulatory challenge could spend ten (10) times more on compliance projects than their counterparts who take a proactive approach.
At the same time, there is significant ambiguity in user requirements for records management, from the lack of standard definitions, to old, technology prescriptive regulations, to the benefits and costs associated with centralized, distributed, or federated architectures, to the role of enterprise policy engines and CMDB repositories, to the changing role of archives.
To address this, a group financial institutions have turned their attention to the challenge of how to design, build, and operate solutions that underpin enterprise wide information governance policies for U-ESI. Not an easy thing to do, no single solution or joint platform solution with end-to-end capabilities in the marketplace, and insufficient standards to drive interoperability among enterprise solution suites, pure plays, and legacy platforms. And also, the users are tired of being the systems integrators, so it is a challenge that if overcome would provide tremendous value to both IT consumers and providers.
The goal is an information governance reference architecture for U-ESI with 4 major architecture components - business process, application, data, and infrastructure. For example, the business process architecture (BPA) defines the business requirements, organizational model, and key business processes of the organization - from U-ESI creation, classification, maintenance, use, and disposition. The applications architecture (AA) defines the individual application functions or business services required, the interactions between the application functions or business services, and their relationships to the core business processes of the organization.
And the architecture, while required to address the compliance and operational requirements of the financial industry, must be open and adaptable by others, whether or not they share a regulatory responsibility with the financial services industry, such as health care.
More to come as the work progresses.