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December 1, 2003

An OMS for Two Sizes

By Peter Chapman

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Vendor Tries Once Again to Sweep up America

It's round two for Decalog. The buyside trade order management system sold by SunGard Investment Management Systems is getting its second shot at the U.S. market. That's after abandoning it four years ago when its technology fell behind competitors.

Best known in Europe, Decalog has been completely rebuilt to go head to head with the dominant U.S. players in both the stand-alone and integrated sectors of the market. "We re-wrote every line of code," said Eyal Yaron, product manager for Decalog. "That's why it took so long. It wasn't easy."

Decalog first entered the U.S. market in 1995 when the product was called Idee (pronounced "ee-day"). The company was owned back then by an Israeli firm called Oshap. It garnered a handful of customers, but by 1999 was being surpassed by more dynamic competitors.

Idee was neither robust enough to handle increasing volumes, sophisticated enough to accommodate FIX connectivity nor flexible enough to satisfy demanding traders. Decalog lost a couple of customers, sold out to Sungard in 1999 and then largely disappeared from the U.S.

"For the past three or four years, we haven't really marketed Decalog," Yaron said. "But now we have a product to support the specific workflow of the U.S. market. This is the launch of Decalog 5.0 in the U.S."

Idee was developed in 1991 in conjunction with French buyside giant Credit Lyonnais. It grew to dominate the French and Italian markets. The system was originally built to accommodate fixed income trade order management and only later retrofitted for equities.

That wasn't too difficult in Europe where managing equity orders has traditionally been a less trading intensive process than in the U.S., Yaron explains. European portfolio managers still manage much of the workflow.

"Trade entry is the same," Yaron said, "but the whole issue of rebalancing and allocations and creating a blotter did not exist in Europe. That was created in the U.S."

Today, Decalog is still mostly developed in Paris, but the equity portion of the system was built with input from U.S.-based managers. The vendor says it has some 45 customers worldwide, including 13 in the U.S.

Decalog is actually a suite of products that includes Decalog Trader, the OMS, Decalog Manager, for portfolio management, Decalog Compliance and Decalog Performance Measurement. Decalog Trader handles both equities and fixed income securities. The entire Decalog suite is one of several products sold by the financial technology conglomerate's buyside division.

Although the Decalog unit is nominally headquartered in Boston, the president, Harold Finders, is based in Paris. Only 30 Decalog staffers out of a total of 100 actually work in Boston. Most are based in Paris. Sales and marketing and product support are handled from Boston, but the top U.S.-based exec, Juerg Hunziker, operates out of New York.