There's been a lot of talk about the impact of new government and industry regulations on IT departments, especially in the financial services sector. But according to recent research it looks like this is just the beginning.
Even given the current level of investment in technologies that help companies comply with regulations such as Sarbanes-Oxley and Basel II, around 60 percent of IT managers from financial services companies believe the demand on IT to deal with compliance issues will increase over the coming three years, according to a report from market researcher Freeform Dynamics.
Most respondents are not satisfied with their current capabilities to perform tasks necessary for compliance such as document management and archiving.
And the report said most financial companies are only just starting to "scratch the surface" in areas such as the archiving of electronic messages and digitized phone records.
Still, while compliance is a necessary area to invest in, it's not among the initiatives such as CRM that IT managers pinpoint as their top priorities for 2006.
The report said: "Against this background, regulatory compliance related developments can easily be viewed as the equivalent of spending considerable time, effort and money in order to simply stand still in business terms."
Freeform Dynamics advocates an 'architectural approach', meaning businesses should look to build their compliance-related improvements into the company's IT infrastructure where possible.
This trend appears to already be underway as around 15 percent more IT managers said building compliance into their IT architecture is a high priority in the future as compared to in the past.
The challenges going forward are likely to be funding and internal politics, as in most organisations infrastructure changes need sign-off from the highest levels - and so underscore the need for IT to foster a close relationship with the business.
The research was based on interviews with 100 IT managers in U.K. financial services companies, equally spread across the following three categories: 100 to 250 employees; 250 to 1,000 employees; and more than 1,000 employees.
Sylvia Carr of Silicon.com reported from London.
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