While we have discussed the many flaws of human data management, the troubles of excel and the many advantages of custom databases, we now have the data to back it all up. No pun intended…

In a survey of fund administrators conducted by the software company “Confluence”. 115 respondents were polled on their data management habits. A whopping 84% of fund administrators are worried that manual processes are hurting their ability to control errors. As a result, senior management at these companies wisely invest in all sorts of technology solutions, all in an effort to eliminate the risks of manual error.

Manual data management in excel files or through other means is certainly more time consuming than the automatic nature of a custom database. 77% of respondents expressed concern that manual processes affect their ability to meet reporting deadlines.

Yet manual data management is still pervasive. 26% of respondents said that they use spreadsheets for more than half their fund administration processes. Another 25% said that they use spreadsheets for a quarter to a half of all processes.

Perhaps what is most striking is a Coopers & Lybrand study that found that 90% of spreadsheets with more than 150 rows contained errors. With that level of error, the risk in fund management becomes exponential. Most managers recognize this and 52% of respondents planned to centralize fund administration within the 12 months following the survey, with 62% of respondents selecting “replace manual process with technology” as their goal within the next 2 years, all in an attempt to reduce operating costs, improve scalability, and minimize risk.

A custom database that integrates data flow with data providers sounds pretty good about now, doesn’t it?

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