“Making daily operations smoother for risk teams at clearinghouses. That’s what it was all about when we designed a new risk management solution, and to achieve this, the graphical user interface was key”, says Jonas Nordström, Product Specialist and Developer at Cinnober. Involving end-users at an early stage of the project was essential to ensure intuitive and efficient human-computer interaction that would relieve stress from the risk department.
It has been said that the role of a risk manager is not for the faint of heart. This is probably especially true if the position is held at a clearinghouse, considering the instrumental role they play in the global financial system. The importance of central clearing counterparties (CCPs) for creating stability in financial markets has been stressed after the 2008 financial crisis. The array of financial instruments that are being centrally cleared has grown due to regulatory mandates, and CCPs are looking into new methods for robust risk management.
There is a balance to offer efficient services and not overcharge market participants with unnecessary margin requirements, while on the other hand avoiding becoming a systemic risk by undercharging, or not having sufficient measures in place. This requires both efficient day-to-day monitoring procedures, as well as long-term risk assessments. As complexity increases, so does the requirements on powerful system support and automation, and not least on having a graphical user interface (GUI) that provides the necessary transparency and is easy to interact with.
Striving for the invisible GUI
The science of how to create user-friendly GUI’s have evolved ever since the first one was created in the late 1970's.
When done right, users won’t even notice there is a GUI, sometimes referred to as the invisible GUI. On the contrary, when done poorly, users can’t get past it to efficiently use the software, causing design-related frustration. Naturally, a reaction that should be avoided in any organization dealing with risk management.
User experience design earning increased attention
The focus on human-computer interaction has evolved over time, both within and outside of Cinnober. Today, there is a dedicated user experience (UX) team with GUI-experts that participate in the majority of Cinnober’s software development and delivery projects.
The team’s overarching goal is to create GUI’s that benefit the end-users in their daily operations so that more time can be spent on analyses and decision-making activities. Klara Kröger Nygren, UX Manager for Cinnober Group has a degree in Interaction Design from Umeå University in the North of Sweden. She explains that the understanding of how UX-design impacts customer satisfaction has grown in the company.
“Cinnober was founded by technicians developing complex trading systems. I would say that an awareness of how important UX design is has developed over the years. It has gone from an unrecognized aspect, to a natural part of the projects, not discussed separately like in the past. Today, a user-friendly GUI is key when designing each client’s solution”, says Klara Kröger Nygren.
The UX-team’s dedication is to optimize the way Cinnober’s customers interact with its trading, clearing and risk solutions. After all, a system is only as good as its users experience it.
End-user involvement with personas
In UX design, the end-user perspective is always at the core. When a new development project is initiated, the first thing the project members must get an understanding of is who the end-users are. What are their needs and challenges, typical behavior, in what context do they interact with the system? Questions like these are often dealt with in a workshop.
Often, two or more personas are created to symbolize the various end-users. Users of Cinnober’s risk management solution are typically risk managers and other risk monitoring staff members, administrators, executives and clearing member representatives. Klara Kröger Nygren explains:
“We have our end-users, or personas, at the top of our minds from the very beginning of the project. It’s important that all project members are clear on who’s going to use the system. UX is not only about user-friendly solutions, it’s about keeping focus on the user throughout the entire process, before, during and after use. It should also be noted that the end-user’s goals should be aligned with the business goals, and by knowing these we know how to steer the investment as well as the design.”
Once system performance and functional requirements have been specified, and the end-users and their goals identified, several methods are used to design and develop the optimal GUI. A selection of the approaches that can be applied include:
Interviews – In-depth interviews with executives, developers, end-users and other stakeholders, to learn what daily struggles and frustrations they encounter with the current solution.
Prototyping – Prototypes are used to verify that solutions are meeting the intrinsic needs of the users. This includes a range from low fidelity (lo-fi) and high fidelity (hi-fi) prototypes as well as visual mock-ups, or pixel-perfect sketches.
Usability evaluations – A trained UX-expert evaluates specific functionality, or entire systems, and suggests solutions that would address issues.
User testing –Scripted tests where a test leader instructs the user to perform certain tasks, studies how the user performs certain actions and reason around the functionality. Much is discovered when simply observing. The UX-team might get answers to questions such as “Why does the user hesitate when selecting an option?”, and “How does the eye move when searching for an object?”.
Cognitive walkthroughs – UX-experts walk through certain steps together, asking themselves a set of questions at each step. “Does the user understand that this sub-task needs to be performed to reach the goal?”. “Will the user notice that the correct action is available?”. “Is the button clearly visible?”, and so on.
Case: GUI-elements in a risk management solution
When Cinnober delivers its cross-asset class CCP risk solution, much effort is invested to create a smooth human-computer interaction that supports the complex, high-pace environment of risk teams. Design and development is done in close collaboration with risk managers and other principal users of the system. The web-based clearing operations GUI offers intuitive navigation and graphical elements that present data in a way that makes it easy to comprehend. Key features of the GUI include:
A dashboard gives a clear overview
When signing in, the user is met by the main dashboard with widgets highlighting grouped data. The layout of the dashboard is customizable, so when the system is installed at a clearinghouse, it is set up to support the goals and needs of the organization.
From the dashboard, the risk team monitors breaches and alerts in real time and oversees integration with surrounding systems. The users can easily navigate from the dashboard to detailed pages for more comprehensive information.
Functions or sets of data that the user can view and act upon are grouped into perspectives. User roles determine access rights to the various perspectives. The dashboard often includes market data and graphs of historical benchmarks and trend analyses.
Graphics for easy interpretation
As it is easier for humans to decode graphical images than overwhelming spread sheets, and data presented in a raw version, the GUI contains a variety of graphical elements. The users can easily filter, select and export data to generate graphs and 3D volatility surfaces to be included in system-made reports that support decision-making. Management and executives can get an immediate understanding, and quickly grasp a situation without delving into numbers.
Traceability and replicability
A key factor of the GUI is transparency and traceability, and the avoidance of black box calculations. By making the underlying input and parameters available, as well as interim results from calculations that are performed in several steps, the risk team gets a comprehensive understanding of how the outcome of risk calculations and stress tests is impacted by various factors. This also improves the communication with clearing members and other stakeholders as the rationale behind decisions is easier to explain.
Jonas Nordström, Product Specialist and Developer at Cinnober, and one of the key members of the team that implemented Cinnober’s risk management solution at the Japan Exchange Group (JPX) (see case for details) emphasizes the importance of a GUI that illustrates risk exposure at any given time, or in a given time horizon.
“The GUI in TRADExpress CCP Risk is designed for easing the interpretation of risk exposure, and with modern technology it enables interactive graphs to be displayed and exported by users. Transparency and details at different granularity are in focus when developing this type of systems and GUI’s. In the end, we want to make daily operations easier for everyone interacting with the system”, Jonas Nordström concludes.