Senior executives at UK asset management firms feel that aggregation - the process of pulling together data for investment, control and reporting functions - is suffocating innovation, according to a market study sponsored by Danish financial services software provider SimCorp.

The survey, which was conducted by consultancy Paul Miller, consisted of 21 in-depth interviews with senior executives. A key finding was that 58 per cent of UK asset management firms feel their ability to undertake new business initiatives is hampered by aggregation.

"These processes are creating a data straightjacket which stifles business flexibility. It is evident that the more complex the operational platform, the more difficult it is to extract useful information from it,” said Cath Rawcliffe, vice president of sales and marketing at SimCorp, adding "the study indicates that this constitutes a significant operational risk."

A "data straightjacket" it may be, but SimCorp's research revealed that many asset mangers still regard aggregation as important, with 59 per cent of respondents running aggregation processes daily and an additional 21 per cent running them several times in one day.

However, many were found to depend heavily on multiple spreadsheets and bespoke databases, even when they are using a data warehouse. Indeed, even though respondents said they would prefer to use fewer systems, many carry on adding processes and data stores.

Timing of the processes and reliance on third parties were also singled out as problems.