5 years, 3 months ago

The dilemma of standards

Link: http://www.etc-architect.com/?p=239

Without standards there are no architects, at least there are only those that will create standards, as most architects like to tinker with existing or chose existing ones. Now in many areas there are a lot of standards around so there is enough to chose from, but in other ares they are either outdated or in general there are few on the ground. Usually technical standards are more common then those that are built on business processes and they are more common than those that create data standards. The other general trend is that standards applying to the public sector are more common then those applying to the commercial sector. Additionally standards in settled commercial areas, such as retail are more common than those in ever changing fast moving commercial areas such as investment banking.

So it is not seldom that when you look at data standards for over the counter (OTC) investment standardisation you will find very little. Often standards in that area only apply on single asset classes such as CDS. The only standard in that area is the ISO 10962 that only scorches the surfaces as it only offers a very high classification. This ISO then mentions other standards such as ISIN number that however only apply to some asset classes. When you however move into exchange traded assets you are instantly hit with some ver good standards. The same is true if you move into the business processes in the area you will find stands such as FpML, FIX, CpML, etc.

The reason for this is like usually money and motivation. In governments standards are vital as they often define the reason for doing something, while in the commercial sector standards are used as a mean to a goal and are only seen as a requirement in themselves if a public body forces them to be used for reporting and similar. Also in public service there is a much higher tendency to pay for standards then in the private sector, unless the standard is included in the product cost for a software (this is why you will find a lot of vendors on the standards committees).

Organisations that tend to be more risk taking or open source projects both have the tendency to only implement a standard if there is one around and otherwise skip it, while risk adverse organisations will rather commission someone to create a standard than do anything non-standard. The risk avoidance is actually the main driver for the willingness to create standards, so the next time you as an architect complain about the missing risk taking attitude you should be thankful for it as this will not only supply you with work, but it is often the only reason that you have some decent standards to tinker and chose from.

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