By Colum Gorman, Business Development Director at Content Guru
Among the many uncertainties brought about by Brexit, it remains to be seen whether the UK will dispense with areas of the EU Financial Instruments Directive II (MiFID II). Irrespective of what goes, it seems more certain that the articles that relate to Recording and Surveillance will be retained.
Given the ongoing pace of EU regulatory change, this is important for UK organisations in the post-Brexit era, who may find themselves subject to even greater levels of scrutiny than before. In fact, trading as a ‘Third Country’ within the EU means that the UK will now have to prove regulatory equivalence, with the complexity of this process is yet to be fully determined.
This provides UK firms with a potentially tricky challenge – how to assure long-term success while maintaining tight control over ongoing cost management. However, there are a number of steps organisations can take to future-proof existing communications recording and storage solution investments, while managing the prospect of additional costs and disruption in the future:
- Adopt a holistic approach to compliance
There’s no doubt that organisations who adopt a 360o approach to communication recording and storage solutions will be better able to position themselves for competitive advantage.
This means going beyond simply considering how to meet today’s compliance obligations to implement open architectures that leverage powerful, emerging technologies and anticipate future regulatory developments, such as those powered by artificial intelligence (AI).
In addition, firms should also be looking to streamline compliance strategies by implementing a unified approach to common requirements, such as the overlapping compliance obligations across MiFID, Dodd-Frank, EMIR and REMIT.
Finally, implementing cloud technology that utilises industry standards and supports organisational change will help ensure firms are capable of adapting with ease to the fast-evolving regulatory environment.
- Invest in open architectures
The pace of change across communications recording and analysis technology is rapidly accelerating, yet regulators and customers will still expect firms to keep up with the latest innovations. This represents a particular challenge for any business that is preparing to meet new compliance obligations, and especially so for those organisations that have already invested heavily in proprietary solutions.
Part of the problem is that these ‘closed architecture’ solutions use technology interfaces that will only work with a specific vendor’s products or file formats and rely on communication protocols that are incompatible with third-party software. This ‘vendor lock-in’ may be a barrier for any organisation that wants to implement a cost-effective or competitive long-term compliance strategy.
Instead, organisations that deploy open systems have the option to use best-of-breed solutions, and can quickly integrate the latest innovations to address any extensions and adjustments that arrive in the future.
- Rethink audio compression
The emergence of new cutting-edge voice analysis technologies powered by advances in Automatic Speech Recognition (ASR) are setting a new benchmark in analysis capability. These developments may eventually establish themselves as the standard compliance requirement across the industry.
As a result, firms must act now to ensure they can integrate ASR technology into their compliance solutions, and for many, this will mean rethinking their approach to audio data compression.
Many of the recording and data storage solutions in use today employ high audio compression algorithms that make files smaller by removing audio data. While this type of compression is useful for reducing file sizes, it also limits overall fidelity and can significantly increase transcription word-error rates. Once this audio is compressed, this lost fidelity cannot be recovered.
To take full advantage of ASR and other next-generation analysis technologies, organisations should instead look to deploy recording and storage solutions that use lossless formats. To improve transcription accuracy still further, businesses can utilise stereo recording that allows both sides of the conversation to be separated – eliminating the transcription errors that can arise when individuals talk over one another.
Furthermore, as ASR performance continues to improve, new algorithms will emerge that enable organisations to re-analyse existing recordings with increased transcription accuracy and analysis. As a result, organisations will also need to ensure they’ve moved on from recorded audio compression techniques if they hope to take full advantage of these useful developments.
- Deploy high-capacity storage
To help meet their compliance obligations, firms are increasingly turning to compliance analytics and AI technologies to sift through large data sets and identify potential compliance violations, based on current and historical data.
In addition, regulatory controls governing everything from best execution and reporting procedures to conducting monitoring and risk management means that firms are becoming increasingly reliant on data-heavy compliance strategies. In order to meet this growing demand for comprehensive high-quality data, organisations will need to invest in robust, high capacity storage solutions.
Ideally, these solutions will also utilise compliant WORM (write once, read many) data storage with the capacity needed to retain large volumes of electronic communications data – including uncompressed stereo voice data – for the duration of any regulated time period.
- Unified recording and analysis
Currently, many organisations use multiple recording and analysis systems or overlapping solutions that require multiple management policies. In contrast, the deployment of a unified platform will enable organisations to take full advantage of resources such as search-and-replay, e-discovery and end-to-end reconstruction.
Delivered via a single system, this approach enables firms to initiate cost-effective enterprise-wide compliance and data management policies that can eliminate many of the problems often associated with a disjointed approach.
Ultimately, by managing their assets and resources much more effectively, firms will not only be able to improve value across the business, but also optimise the effectiveness of their compliance officers who will be better placed to prioritise their valuable time and resources.
