Merrill Lynch's IT Initiatives

Abstract

The case examines the two major IT projects implemented by the US-based Merrill Lynch & Company (ML), a leading global financial services firm. It describes the Trusted Global Advisor (TGA) project that aimed at offering high quality content and analytical tools to enable ML’s financial advisors create, use and track financial plans for their clients. The case describes in detail the systems architecture of TGA, its utility and the problems faced by ML during and after implementation of the project. The second IT project that ML launched to replace TGA was the Wealth Management Workstation (WMW), the largest IT project worth $ 1 bn to be fully outsourced by third party vendors. The case discusses the system architecture of WMW, the role played by various vendors. Finally, it updates on the current status of the project implementation.

"Merrill Lynch Financial Advisors are among the industry's most highly-skilled professionals, committed to helping our clients realize their financial goals. Wealth Management Workstation will provide our Financial Advisors with the best technology, tools and content the market has to offer."

- James Gorman, President of Merrill Lynch's US Private Client Group.

In November 2002, the New York-based financial services major, Merrill Lynch & Company (ML) entered into a landmark agreement with Thomson Financial (Thomson) , to develop and launch a new information technology (IT) platform called Wealth Management Workstation (WMW). This deal was unique as it was one of the largest IT outsourcing projects from a leading financial services company. It was watched closely and with much scepticism by industry. Expressing his opinion, Dennis Ceru, director of retail brokerage and investing at the research and advisory company, Tower Group, said, "Just the fact that Merrill is outsourcing such a critical system at all is being watched closely by the financial services industry. It's huge. It's a major Wall Street firm with the largest number of registered brokers making a decision to partner with external providers to create its lifeblood system."

With new client-serving technologies introduced in the early 2000s, TGA became obsolete, forcing ML to outsource the Wealth Management Workstation (WMW) platform in early 2002. However, industry analysts were sceptical about the success of the WMW project. Commenting, on this, Punishill of Forrester Research said, "This is the biggest outsourcing project in all of financial service. Unless the [financial advisors] are trained properly and actually use the new system, assuming it provides the functionality that's promised, it's not going to be any better than the system they already have."

On January 06, 1914, Charles E. Merrill (Merrill), a broker on Wall Street, founded the investment firm, Charles E Merrill & Co. His credo was, "I have no fear of failure, provided I use my heart and head, hands and feet - and work like hell." His mission was to make Wall Street accessible to even the common man on the street. In May 1914, Merrill persuaded Edmund C. Lynch (Lynch), a friend for past seven years, to join his firm as a partner.

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        Case Code   ITSY038
   Case Length    15 Pages
              Period    1997 - 2004
 Organization     Merrill Lynch
        Pub Date     2004
Teaching Note    Not Available
     Countries    USA
      Industry    Financial Services

Issues

• Study the systems architecture of a typical IT project and examine the objectives for its implementation in a financial services company.

Merrill Lynch, IT Projects Implementation, IT in Financial Services, Trusted Global Advisor, Wealth Management Workstation, IT Systems Architecture, IT Outsourcing.

Please note:

This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.