Regulatory developments and new tax and compliance requirements are forcing companies to update their information systems at a rapid pace. Data usage has also increased exponentially, making it much harder to manage, store and communicate information across platforms. Furthermore, security requirements for the information handled by companies are becoming stricter to prevent theft or attacks from outside sources.

These factors clearly demonstrate the increasing technical complications associated with systems integration, development and maintenance. They also underline that under these circumstances, a "best of breed" approach - looking for the best tools on the market and then developing interfaces so that the programmes can interact - is becoming much harder to implement and costly to maintain. This solution, which held so much promise a few years ago, now has a higher bar to clear with respect to keeping up with changing conditions and meeting security requirements.

MiFID, FATCA, and soon, automatic exchange of information - these new regulations affect a growing array of fields within the domain of information systems. For proof, look no further than the example of suitability as it applies to data management in multiple areas: clients, financial products, and the specific rules for each country in which the bank operates. In these kinds of cases, if the data in question are managed using a variety of tools, it can be incredibly complicated to update systems comprehensively when regulations change. Not to mention the fact that the system changes often have to be made in a very short time span over which the banks have no control.

In today's environment, the interfaces created to allow different best of breed systems to coexist mean growing integration and maintenance charges, which can negatively affect a company's ability to finance new investments. When IT teams need to enable communication among systems based on different approaches, philosophies and internal logic, the solutions often involve costly data translation techniques using a language understood by all of the systems involved. At present, there is no way to measure the real value created for clients by this interface spending.

At a time of streamlining and optimization of costs, most institutions that have opted for a best of breed approach are seeing the costs required to maintain the strategy rise year after year. They are also realising that having the market-leading solution doesn't mean much if adapting it to the existing information system eats up time and financial resources. Sometimes, it makes more sense to opt for an integrated banking solution, one that lets users consider changes comprehensively and plan updates as a complete package, including execution across platforms and at every level.

An integrated system is based on a single data model that can be adapted more easily in response to regulatory changes or security requirements. This approach also facilitates data protection because information is stored in a single database.

A best of breed approach is less secure because sensitive data are spread across multiple applications. This kind of solution requires gateways between several standards containing redundant data. This situation raises the risk not only of data-entry errors, but also of mistakes in data processing and integrity, which can lead to an increased number of errors, significant operational mistakes and a higher risk of data breaches.

The trouble that this kind of system has in ensuring optimal protection and security is compounded by the fact that numerous suppliers are involved, all of whom have different levels of security. In cases such as this, as we all know, the security is only as good as the weakest link. We should add that if a supplier goes out of business, the entire information system suffers from the lack of maintenance for that component. Today, then, it makes more sense to choose a single, reliable supplier offering clients sustainable solutions and a real long-term partnership.

With these factors in mind, under today's conditions, an integrated system is the overwhelmingly better choice compared with best of breed. Aggregating information within a single system has real implications for service quality. Offering enhanced security and better risk management, an integrated system makes it easier to consolidate customer data, perform management control functions and incorporate new tax and regulatory considerations.

Building a system from scratch takes a significant amount of time, money and expertise. Few companies have the size or experience needed for such an effort. Opting for an integrated solution covering all a bank's needs helps the bank control costs, optimise data security and nimbly adjust to current and future changes.

Jean-Claude Favre is CEO at Crédit Agricole Private Banking Services