Research Results: What IT Project Managers Think About Financial Investment Firms Pursuing Straight-Through Processing With Agile and Workflow Management Systems
This article provides insights from research performed to get IT project managers’ perspectives on the value of using agile and workflow management systems to attain straight-through processing on the financial investment sector.
Straight-through processing is a dedicated commitment to settle a securities transaction within 24 hours, which is a major shift from the current U.S. settlement practice of three days. Obviously, a primary benefit of straight-through processing is a significant decrease in settlement risk because of the reduction in transaction-related processing time. The shorter processing time greatly decreases the risk that a contract or agreement is settled outside the appropriate time frame (Williams, 2012). Thus, straight-through processing can be defined as capturing and processing transactions in one pass from the point of the initial inception of the pre-trade deal to final trade settlement.
In 2001, the U.S. Security and Exchange Commission announced plans to shorten the settlement cycle to within 24 hours, also referred to as T+1, by mid-2005 (U.S. Securities and Exchange Commission, 2001). As a result of this announcement, many financial investment players were required to begin developing capabilities to reach the desired goal. Their efforts surfaced the many barriers to attaining a settlement within one day, including
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