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Case study

Taking cost out of mission-critical IT

A leading electronic securities exchange had recently acquired its leading competitor and needed a plan for integrating the two companies' technologies. We redesigned the client's technology platform and IT architecture, which contributed to 50% cost savings.

  • min read

At a Glance

  • 50% cost savings
  • 100% market value increase

The Full Story

The Situation

The client is a leading electronic exchange for securities. A wave of new electronic exchanges emerged in the mid-90s and created vicious price competition. SecuritiesCo* had recently acquired its primary competitor and needed to integrate the two technology infrastructures. Also, SecuritiesCo was under significant pressure to reduce costs where customer interfaces accounted for ~30% of technology costs. Bain was asked to advise on the following issues:

  • How should we integrate the technology infrastructures of SecuritiesCo and its recent acquisition?
  • How should we restructure the organization to best compete in a consolidating industry environment?

Our Approach

Bain team set up two primary work streams: strategy and technology.

Our Recommendations

Bain recommended the following solutions in a complex realignment of the IT architecture:

  • Front-end customer interfaces to be fully replaced with a new architecture that is in line with business needs and capabilities.
  • Back-end systems to be consolidated utilizing the best components of SecuritiesCo and its acquisition.
  • Matching engines to be integrated into a single system to support a single quote and to optimize speed and functionality.

Bain recommended an aggressive transformation plan to support organizational alignment along businesses, while maintaining trading synergies: Two businesses, Agency Brokerage and Exchange, to maintain separate business organizations while sharing certain technology platforms.

The Results

  • Redesigned technology platform allowed SecuritiesCo to realize 50% cost savings
  • Organization restructured around value added broker, exchange and technology
  • 100% increase in market value
    • Stock price doubled over case period


* We take our clients' confidentiality seriously. While we've changed their names, the results are real. 

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