How Technology Support Investigation Function:Morgan Stanley - Essay Example

How Technology Support Investigation Function: Morgan Stanley Introduction Morgan Stanley is a global financial services firm dedicated in three core business units: investment banking, private banking, and asset management (“Morgan Stanley,” 2007). To trace its roots in the history, the company was originally formed by the previous J.P. Morgan & Co. and some partners from Drexel which was headquartered in Wall Street, New York City. Among its business segments, investment banking is one of the largest in the world and considered to be the most profitable (Ganzi, Seymour, Buffett, & Dubash, 1998, p. 23). In order for investment banks to become more efficient in their services particularly in handling diverse information, they choose to adapt new technologies such as telecommunications technology, computers, and computer networks. The integrated bank is supported by front office, business support, and shared services, which at the same time has three specific functions: investigation, underwriting, and selling. The main thrust of this paper is to discuss the investigation function within the investment of Morgan Stanley and how the technology supported the function. The Technologies That Support The Business Function The three business segments and functions of Morgan Stanley are supported by shared services and information technology (IT). These are the critical areas that ensured a smooth running of the business that work directly or indirectly. Aside from the execution of business, they also provide financial advisory and capital raising services on institutional clients. Through these technologies, the order agreed with the customer is being executed then it will be captured into the back office system that involves operations and IT so that confirmation details will be sent to the customer. The technology will also do the calculation, forecast, and real time information of the required funding, and finally the maintenance proper of corporate actions and open positions. Shared services supported the bank in the areas of Chief Financial Officer, Chief Operating Officer, Chief Risk Officer, General Counsel, and Investment Banking Support. On the other hand, IT supported the business divisions of the bank so that it will be able to meet demands and business priorities. This is the reason why investment banks choose to spend much more on its IT department compared to other financial service companies. Basically the roles and opportunities of IT involved initiation of the project, business analysis on the documents, system analysis and design particularly on the architecture, construction or developer, validation, deployment of infrastructure engineer, and support from analysts. It has been mentioned earlier that investment banks can be viewed generally or by a wide range of functions that include investigation, underwriting, and selling/distribution. “The function of investigation and analysis is to determine whether a proposed bond issue has sufficient merit to be offered to a conservative investing public” (Moulton, 1975, p. 157). Before a certain issue of securities is undertaken by any investment bank, an investigation and analysis are performed first. Morgan Stanley is one of those high standing investment houses that performed specialization on cases of very large issues. Being an intermediary or agent among different institutions for many corporate financial transactions, the company must make certain that the securities are profitable to the clients as well as on the investment banking institutions. Part of the investigation is the adaptation of emerging technologies so that obtaining needed information will always be possible. Through the “innovative data communication technology allows the desk staff to store, retrieved, and update knowledge regardless of geographical and time limitation” (Lytras & Naeve, 2007, p. 277). This function is also supported by a technology called e-support wherein both the users and the investigating panel will make use of online resources such as the e-mail and the web. Issues Affecting The Design Of Technology To Support Investigation Function Investigation function is a complicated task because the process is not generally applicable to all but there are some limitations to consider in every type of issuing body. According to Willis and Edwards (1925), “investment houses handle municipal, public utility, and railroad issues to practically any amount, but only few banks of standing are willing to take over large issues of industrial corporations” (p. 303). Because the legality of the issue is being considered, technology that often supported the process need to be changed. The intensity of the investigation depends upon the type of issuing bodies wherein the more it is complicated - for those newly formed organization compared to an old-established corporation - the higher is the technology needed. IT should have an upgrade and enhancements of application in order to obtain a comprehensive set of information and technical implementation of resources. Say for example, institutional securities group technology from Morgan Stanley supported the investment banking in terms of connecting with external clients plus exposure to institutional trading venues across the world (“Technology,” n.d.). Aspects Of Technology That Involve Infrastructure And Application Development The infrastructure of technology involved a development team that is composed of business analyst, developers, managers, and engineers in order to give detailed descriptions and practices for the IT department of investment banks. All of them are needed in order to develop a system that will help in running the business particularly in trading and communication to the other user of applications. For example, enterprise infrastructure is the technology group capable of producing a technology applicable for a global operations for it consists of mainframes and servers, databases, network, storage, websites, etc. (“Technology,” n.d.). Infrastructure is in the outside aspects of technology that supports investigation function in order to maintain high standards of service and consistency of technology. Application development is usually presented in private banking, asset management, and investment banking. If infrastructure is more on the management, development, and operations of IT, application development involved end-to-end software development services and it is in the inner aspects of technology such as the traditional data access model. In investment banking, usually the application development commenced with the evaluation of the clients requirements; however, it is more or less found in private banking and asset management of the business. Conclusion Morgan Stanley is one of the leading investment banks in the world. The bank is standardized, specialized and is not generally viewed but based on functions that include investigation, underwriting, and selling/distribution. Being an agent toward different international institutions, the bank needs to conduct investigation first and foremost to make certain on the caution of securities. This function is supported by shared services and information technology so that information will always be possible. References Ganzi, J., Seymour, F., Buffett, S., & Dubash, N. K. (1998). Leverage for the environment: A guide to the private financial services industry. Apache. Retrieved from http://pdf.wri.org/leverage_for_the_environment.pdf Lytras, M. D., & Naeve, A. (2007). Ubiquitous and pervasive knowledge and learning management: Semantics, social networking and new media to their full potential. USA: Idea Group Publishing. Morgan Stanley (2007). Morgan Stanley. Retrieved from http://www.morganstanley.com/about/ir/shareholder/10k2007/10k11302007.pdf Moulton, H. G. (1975). Wall Street and the security markets. USA: The University of Chicago Press. Technology - Asia Pacific. (n.d.). Morgan Stanley. Retrieved from http://www.morganstanley.com/about/careers/careers/programs/articles/164.html Willis, H. P., & Edwards, G. W. (1925). Banking and business. New York, NY: Harper & Brother Publishers. Read More