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Cost per Trade and Settlement STP Benchmarking

Six Sigma – iSixSigma Forums Industries Financial Services Cost per Trade and Settlement STP Benchmarking

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  • #53522

    Sayyed
    Participant

    Hi Forum Members:

    I am working the Operational Excellence group supporting an Investment Banking client. One of the key Business Performance metrics for an IB is Cost per Trade, something that we are intending to measure, baseline & then benchmark with the best in the industry.

    I wished to understand if any of you has done something on similar lines and would it be possible for you to share your approach / experience with me. Much appreciated.

    Cheers,
    -Neal
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    #198379

    CARLOS MAESTRE
    Participant

    Hi, same challenge here
    we are trying to figure out how to get value from some LSS tool to understand STP rates for settlements and also for trade allocations

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    #198384

    Shelby Jarvis
    Participant

    Neal,

    Cost tracking at a high level is the same regardless of industry. For example, in manufacturing; cost of quality, cost of issuing a purchase order, cost of logistics, etc. are commonly used. The process for each of these is first defining the components of the cost equation.

    At an elemental level, you need to define the components of IB per Trade with clear operational definitions. If you plan to benchmark, you should start with the data source you plan to use as a benchmark, understand the components, and use this as an input to your work. Otherwise you are not comparing equal data.

    As a thought, identify and define these components and share your logic with your stakeholders. If they agree, then you can begin building the process to collect the data and build the analysis.

    Does this helps?

    Shelby

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