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Text and data analytics help enable fast, automated extraction of data about intangible assets, allowing financial analysts to deliver greater value to organizations and individual investors.
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The challenge How might someone determine the market value of codified enterprise processes? Or of existing customers and quantifiable human capital? Intangible assets, including licenses, franchises, patents, trademarks, brands, know-how, market competencies and human resources, constitute almost 80 percent of the stock market value of modern corporations. However, despite their significance, there are few tools for evaluating and analyzing intangible assets. In contrast to tangible assets, there appears to be no common measurement standard. Since returns from investing in intangible assets seem difficult to measure, most corporations have little organized information available for objective analysis. This presents major challenges for financial-services analysts, who are under intense pressure from increasingly educated and tech-savvy investors to deliver more relevant and better targeted research to justify their cost.
As a percentage, the proportion of intangible assets is increasing, driving the need for tools that can evaluate and compare them. Current standard-query referencing is a slow, manual process that requires painstaking research. What the financial services market needs is the ability to automatically analyze both the intangible and tangible assets of a company.
The approach While a fully automated solution for intangible-asset evaluation is not yet available, a combination of maturing technologies could provide analysts with automated tools to quickly locate and extract the right data to support fast analysis of intangible assets. Text analytics, data mining, information integration and intelligent search can help analysts (and investors) get answers to standard queries, like finding “companies with a good set of brands, good technical workforce or that are growing slower than their market.”
IBM Research introduced the Unstructured Information Management Architecture (UIMA), which can facilitate the execution of a more comprehensive, industry-wide solution. This standard for combining several text-analytics engines permits data feeds to be built incrementally. UIMA can provide financial services organizations with a simplified blueprint for assembling the right components for an automated asset-valuation solution. Based on open-standards technology, UIMA specifies the interfaces that different components must adhere to, but otherwise they are viewed as interchangeable. This flexibility means that these components can come from different vendors and be easily replaced as the quality of text analyzers, search engines and available knowledge sources improves.
Next steps With the emergence of advanced software for information integration, and the maturing of text and data mining, only a small leap of imagination is needed to envision comprehensive financial tools for analyzing intangible assets. Innovative IBM solutions designed for financial services and other industries will continue to push the development of a comprehensive solution. For example, products like IBM Early Warning Systems could be adapted to deliver alerts to brokers and investors based on any set of criteria. In the future, a Next Generation Financial Workbench could support financial analysts and brokers in their investment decisions by increasing their insight through automated and semi-automated value-analysis and comparison tools. Ultimately, text analytics and data mining will drive the revolution in how companies are analyzed. IBM Research is positioned to be at the forefront of the industry’s IT transformation.
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More on the issue | Text Analytics for Asset Valuation Learn more about how tools for evaluating intangible assets will change the investment landscape. |
More on research | IBM Systems Journal: Unstructured Information Management Get more information about the tools, methods and architectures that are evolving for managing unstructured information. |
MIT Sloan Review | Leveraging the Power of Intangibles Article by Wlodek Zadrozny |
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