Adding the COO role to the CIO job
Maximising the performance of the trading platform
Reducing development time
Industrialising trading technology
London Stock Exchange CIO Antoine Shagoury – who recently added COO to his job title – tells Computer Weekly about the balancing act of managing corporate IT and ensuring the company’s core business of providing trading services has the right technology to make it competitive in a sector that doesn’t stand still for a microsecond.
The London Stock Exchange is using its core technology to become an investment industry service provider that offers companies both industrialised trading technology and direct trading services.
Antoine Shagoury joined the London Stock Exchange in February 2010 as CIO. His first job was to oversee the replacement of legacy trading platform, Tradelect, with the MillenniumIT system the London Stock Exchange acquired when it took over the Sri-Lanka based trading software maker for £18m in September 2009.
Adding the COO role to the CIO job
He was recently appointed COO and but retained his CIO role. His deep understanding of the technology will enable him to manage the integration of the exchange’s different businesses, which rely heavily on technology.
The CIO component of his role is also split in two. On the one hand he manages the technology that keeps the business running. Here he focuses on efficiencies. He spends about 15% of his time on this and has about 70 IT staff globally working on projects such as virtualisation, the introduction of business intelligence tools and using cloud-based CRM and collaboration software.
On the other hand he is in charge of the systems that drive the business, to which he dedicates considerably more of his time. He has about 1,000 staff in this part of the business – which includes the provision of software to other trading venues – of which 200 staff have been added only in the last two years. Most are Sri Lanka-based software developers.
Shagoury says less time is required for corporate IT, because it is more stable. As his operational role increases, he is looking at ways to reduce the time spent on his corporate IT role, helping management in different divisions take on a more strategic technology role.
“We will empower the leaders of different pillars of the business to take on a more strategic technology role,” says Shagoury.
Maximising the performance of the trading platform
In contrast, heading up technology at the exchange puts him in charge of customer-facing systems, none more important than the core trading platform. Since the London Stock Exchange migrated to the MillenniumIT platform in February 2011, it has run smoothly. In the last 12 months it has had no downtime.
The certainty is in stark contrast to the last couple of years of the .Net based Tradelect system, which experienced numerous high-profile outages. The London Stock Exchange management realised it had reached the end of its life, in a fast-changing sector and acted quickly to replace it.
Now the core trading platform provides what Shagoury describes as the three Cs of certainty, continuity and capacity to customers, he is focused on adding services, using the same platform that give customers industrialised packages that can be adapted to fit their requirements.
“All of this is possible now that the right technology is in place. In the past we were limiting the business that could be done,” says Shagoury. Today the Millennium software provides an extensible platform.
There are constant attempts to maximise performance.
Reducing development time
A few years ago when new exchanges, known as Multilateral Trading Facilities (MTF), appeared – following the liberalisation of the market – there was a race to be the fastest.
Reducing trading times, or latency as it is known, is an important differentiator to investment firms that use algorithmic software to automate massive volumes of trades. Milliseconds can make a huge difference.
Today, after reducing latency to about 100 microseconds, from Tradelect's 3.7 milliseconds, there is less focus on speed. But the exchange’s software teams are busier than ever developing software to give customers more services and confidence.
“We are improving latency all the time – but it is not about speed, but better risk control, reporting and data,” says Shagoury.
The exchange uses agile software development techniques to introduce services to its customers in days rather than months.
“Over the last year we have created tighter working groups and teams,” says Shagoury. Working thus, the business gets a real-time view of the development process and prototypes are created quickly.
Much of the focus is to push the technical capability of the core system to the periphery to improve tools such as those to collect and distribute data and this to protect the market from potentially risky volatility.
Other ongoing developments include the introduction of common market and data access and the embedding of more intelligence into hardware.
Industrialising trading technology
At the same time, the company’s software supplies business, MillenniumIT – which grew about 10% last year – is focused on industrialising trading technology.
Shagoury says the business wants to create systems that do not always have to be bespoke, but are flexible enough to be off-the-shelf.
“We can ask customers what bits they want and we put them together,” says Shagoury. But he says systems for the trading sector must enable exchanges to customise.
“We can provide a common solution and exchanges can customise it, so they don’t lose their identity.”
He says the supplies business is picking up new customers all the time and, as more and more exchanges start using the MillenniumIT platform, the better the exchange becomes at migrations.
This is largely down to the industrialised nature of the software. As well as moving its own trading venues onto MillenniumIT, such as Milan-based exchange Borsa Italiana, it has also recently moved the Johannesburg Stock Exchange and Mongolian Stock Exchange to the platform.
“We are getting faster and faster delivering systems because it is industrialised,” adds Shagoury.
The fast-moving technology nature of the trading sector is rewarding for IT professionals. Shagoury’s advice to IT professionals of the future that have ambitions in the trading sector is to build a strong understanding of the business.
“It is no good being a pure technology professional because you have to understand how to apply it,” says Shagoury.
