Industry jargon such as reference to business “silos” will
appal linguistic purists but financial technology firm
SimCorp makes no
apologies in using the term in a new paper exploring how businesses go wrong with technology.

SimCorp, which provides investment management software and
other services, has released a new white paper report, called The Silo Effect:
Losing the Game with a Decoupled IT Strategy.

First published in the SimCorp Journal of Applied IT and
Investment Management, the paper is authored by Bruno Bonati, independent consultant,
Frank Furrer, independent consultant, and Stephen Murer, managing director and chief
architect for Credit Suisse. (To view the paper in full, click here.)

The paper describes the “silo effect,” when business units
with individual IT budgets implement changes at the same time without
co-ordinating in a strategic way. This can hit efficiency. Highly fragmented IT
systems can hurt, rather than benefit, a business.

To develop a cohesive IT architecture, the authors of the
paper recommend:

-- Align business and IT via “managed evolution”, steering
the evolution of an enterprise’s information system to increase efficiency in
developing and operating the system;

-- Architecture management: break large information systems
down into domains, providing more manageability;

-- Integration architecture: define the appropriate coupling
and decoupling of the system’s components to ensure stability;

-- Develop a holistic IT strategy through more formal
coordination in strategic business-IT alignment and ensure decision-making is
made in a well-balanced way;

-- Embed the IT organisation in the investment management
business it serves.