Data Flow Analysis Presentation

1. Asset Allocation Process By: Elizabeth Bray

2. Company Background Pinnacle Advisors Based in Lincoln, Nebraska Advisor for the Insure-Rite companies Asset allocation process is used to decide on investment policy for the Insure-Rite companies Pinnacle is a wholly-owned subsidiary of Insure-Rite Pinnacle advises other institutions and high net worth individuals

3. Company Background Total firm assets under management $10.1 billion Investment capabilities Fixed income Corporate fixed income Mortgage-backed fixed income Equity Large cap growth equity Commercial mortgages and Real Estate

4. Project Background Asset Allocation program Deciding how much stocks and bonds an institutional client should own The core of the process uses a mean variation optimization program Approximately 10 percent of firm assets under management are submitted to the process

5. Context Diagram

6. Level 0 Logical Diagram

7. Level 1.1 Data Flow Diagram

8. Level 1.2 Data Flow Diagram

9. Problems and Issues Process lacks sufficient definition Lack of focus requires too many iterations Process complexity inhibits Managing Director’s understanding of project goals There can be as many as seven iterations Repeated processes improve the chances for error Each iteration introduces additional lag time Each iteration requires the process to restart at the beginning The client receives their recommendation later than expected

10. Opportunities For Change For each iteration removed slack time decreases by 3-5 days Adding query process prior to optimization should remove several iterations Valuable analyst time can be used on other projects, increasing firm productivity The client’s recommendation done in 1/3 of the time

11. Challenges Managing Director buy-in uncertain Introducing Query process may be difficult Reluctant to give their information in isolation Providing a format that they refuse to use Resistance to change Reducing slack time may cause stress with other external entities