Ahead of the Game
The New Reality for Customer Engagement
Date: 5/31/2018 @ 1 p.m. ET
Ahead of the Game
How many companies can already meet the new deadlines? Not many, says Scott Parker, managing director of Parson Consulting, a London-based consulting firm with clients in the U.S. and U.K. affected by the new law. According to a recent Parson survey of executives at almost all 500 companies in the S&P 500, only 11 percent now file quarterly reports within 35 daysthe new deadline. The average for healthcare and pharmaceuticals is 42.5 days; finance and insurance, 43.1 days; consumer products, 40.4 days; chemicals, energy and utilities, 42.7 days; and services, 40.2 days. Industrial and defense firms, meanwhile, average 39.5 days, according to the survey.
Former SEC commissioner Steven Wallman, a staunch advocate of digital systems during his 1994-97 term, cautions CIOs against underestimating the impact of the new laws on company IT systems. "This will be more costly than people think because it's not just the IT equipment but the software, training, upgrades and people that will be needed to put in the new real-time information systems the SEC is seeking," he says. "And then there will need to be people and systems set up that are able to check it all to make sure that there is better and faster reporting of the numbers. Hopefully, CIOs can rise to the occasion."
Technology researcher IDC is forecasting that financial and business performance management software, combined with strategic planning and financial consolidation software, is expected to be a $1 billion market in 2002, jumping to more than $1.5 billion by 2006thanks, in part, to the new regulations.
Indeed, some vendors are already coming forward with new offerings aimed at helping firms meet the challenge. New York City-based start-up eRestrictedStock Inc., for example, is offering companies Web-driven software that can help them file insider trading reports within the SEC's new two-day deadline. BoardVantage Inc., of Berkeley, Calif., meanwhile, is pushing messaging system and collaboration software for use by members of boards of directors so they can better oversee the companies they govern rather than simply show up at meetings and play golf. "What we find is that creative accounting is usually accompanied by 100 to 200 catch phrases, like 'change in accounting,' or 'uncollectible loans,'" says A.K. Pradeep, founder and CEO of BoardVantage. "Now, [with our software,] if you are thumbing through 500 pages of an M&A proposal, imagine you have a little angel that tells you that on page four in line 25 there is a certain phrase you want to pay attention to." In Pradeep's view, "the boardroom is almost the last bastion where the light of technology has not really crept in."
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