Our preference is to build in-house teams, boost India role: CME Group CTO

The world’s leading derivative marketplace, CME Group, which is in the midst of becoming the first exchange to offer real-time futures and options market data in the cloud, sees its India operations as crucial to its operations.

Kendal Vroman, chief transformation officer of CME Group, who was in India recently, said that India was never about labour arbitrage and over time has built an India team that now owns several global mandates.

The company, which has had its presence in India since 2015 and an employee base of 570, plans to ramp it up further by 100 employees by March next year.

When asked if going to the cloud means a cut down in its relationship with third-party vendors, Vroman said that though the relationship with the partners does not change, going ahead it will be the internal team that will get ramped up.

“Over time as we go to the cloud, we want to be more self-reliant. We always like to be that, hence we will be using third-party vendors for very targeted reasons and more for project-oriented work,” said Vroman in an exclusive virtual meeting with Business Standard.

He added that he would prefer to build the India team. “Our default position is to try and build these things in-house. One of the reasons for this is because our business is very complex. Hence, we would rather hire people here, invest in them, make them part of our culture, retain and grow them within the company,” added Vroman.

Prabhuram Duraiswami, executive director, CME Group’s India head & global head for referential services at CME Group, also added that unlike several MNCs having India centres, for CME, the India unit is not a global capability centre or a global in-house centre. “From day one, we hired the best in the field who could understand things like derivatives. We had PhD holders in mathematics. The idea was that we already have service providers supporting some of the operations, so let's start building applications from scratch from here,”

CME has several global roles that are in Bengaluru. “Some of the people here in India have been with CME for 7-8 years. They have teams from Belfast and Chicago reporting to them,” added Duraiswami.

Vroman added that the results of letting the India team handle ownership of a unit have yielded great results. “They are not just part of a really big machine. They're part of teams that own applications. They're working on the most strategic things we have in terms of data and analytics, it's led out of India and from our point, this has meant an acceleration of our investment here,” he said.

CME’s cloud journey with Google is a case study in itself as it aims to give access to data in real-time. Before CME Group engaged with Google Cloud, customers could access CME Group’s data in two ways: by co-locating in its data centre in Illinois or by subscribing to a market data aggregator service, which meant more cost.

With adopting the cloud, CME Group can now reach 10,000 subscribers on a single data stream, and with 10 TB of data per second. Customers can access a full day’s history of market activity in less than 20 seconds. And by offering access to its market data on demand in a pay-as-you-go consumption model, CME Group can reach new customer segments, explained a Google post.