Conclusion

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The rapid growth and recent T+1 development of cross-border security trading have an impact not only on investment firms and the capital markets in which they operate, but also on surrounding banking and insurance institutions. Firms that do not have the capability to complete the transaction cycle effectively will be forced out of the industry. To remain competitive, firms need to address the challenges brought about by STP immediately. Global STP capability may not be achieved by simply initiating a series of projects to address the challenges. It needs to be approached by a well-orchestrated re-engineering activity, and enterprise-wide technology solutions. Firms should take a holistic view of change - the use of process re-engineering with technology integration. It should be performed in an integrated approach rather than distinctive process re-engineering projects or technology initiatives. The change must also embrace the concept of the "continuous interaction cycle" approach, as STP transactions must satisfy the requirements of all the parties concerned in order to achieve their intrinsic value. Considering the proposed T+1 implementation timeframe of July 2005, financial firms need to assess their readiness for STP, and begin the process right now.

STP is an emerging technology that has a potential to substantially enhance the effectiveness of cross-border security trading and the development of global financial markets. However, research on STP has been laggard and limited. Opportunities as well as challenges lie ahead when STP is being implemented in financial firms and institutions in the US and other countries around the world. This study proposes a STP readiness assessment framework that can help manage STP implementation risks and increase STP implementation success rates from a global perspective of electronic business. Future research may further study STP implementation strategies based on the STP readiness assessment framework proposed by the current study.

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