I have spent over 30 years studying and working in information technology, or IT, as it is commonly recognised. This is not an acronym but an initialism, one which is widely used across both the technology and business world.

Let’s start with a few definitions

An acronym is a word formed from the first letters of a series of words and pronounced as a single term. NASA, for example, stands for National Aeronautics and Space Administration.

An initialism, on the other hand, is formed in the same way, but each letter is pronounced individually, IT (information technology) as an example.

Some people don’t always like abbreviations

There are a few people who get annoyed by acronyms or initialisms, but for me, it’s the latter that cause me the most angst. For example, if it takes a similar time to spell out the letters as it does to say the full words, just say the words! If you use an acronym, it’s your responsibility to make sure everyone in the room knows what it means. And if you include one in documentation, please always define it the first time it’s used.

Where financial services and technology meet

It is safe to say that the financial Services industry predates modern technology, with the origins of the city of London stretching back hundreds of years to medieval times, when merchants and money lenders began trading.

If we look at early practices of “shortening” in financial services, Lloyd’s of London soon became simply Lloyds in the late 17th and early 18th centuries. Similarly, the Bank of England has long been referred to as the BoE in documentation and communications.

When considering some of the earliest acronyms and initialisms in computer science, a few notable examples spring to mind. For instance, ENIAC (electronic numerical integrator and computer) was built at the University of Pennsylvania in 1945, while EDSAC (electronic delay storage automatic calculator) was developed at the University of Cambridge in 1949.

The IT industry also saw early businesses form, such as ICT (International Computers and Tabulators) being a significant British company formed in the late 1950s, later known as ICL (International Computers Limited). And of course, there’s the globally recognised Computing-Tabulating-Recording Company (CTR), founded in 1911 and rebranded to International Business Machines (IBM) in 1924, the three letters that nobody gets fired for buying.

So, where are we today when investment management meets IT? Here are my top tips below:

• If you’re from IT and you meet a CIO in an investment management firm, they are very likely a "chief investment officer", not a "chief information officer".
• MSP (managed service provider) is often used by investment companies to refer to managed IT support providers looking after their infrastructure, security and cloud operations.
• Don’t confuse your "gross domestic product" with your "general data protection regulation" (GDP vs GDPR).
• For those from finance, IT companies love using MS of MSP in various contexts, but don’t mistake it for Microsoft. IT people, Microsoft is MSFT to the investment folk!
• In the advancing world of artificial intelligence and machine learning, the initialism AML is increasingly used for "automated machine learning". Please don’t confuse it with "anti money laundering"; otherwise, we’ll end up with AML based AML systems, so let’s please avoid any more AMLs.
• "Investor relations" (IR) in finance could mean "information retrieval" when referring to a data-based service context, or in a more IT support-focused environment, it could also be "incident response". Best not to irk anyone with any more IRs!

There are going to be a lot of acronyms and initialisms you’ll see everywhere, not just in IT and finance, but across the spectrum of brands in everyday life. Look no further than car companies. A brand has really “made it” when fewer people know the full name behind the acronym. When this happens, we sometimes call it a backronym; IBM would certainly sit in this camp.

I regularly find myself asking clients and colleagues alike, “What does that stand for?” You will also notice that the same task can have different acronyms in different companies. This is also normal, so seek out that company’s acronym dictionary if one exists. (I once wrote one and presented it at a large corporation I worked at. Sounds dull, but it went down a storm!)

Key takeaways for using abbreviations wisely

In conclusion, I think we need to be pragmatic when creating abbreviations in the future. Think about their value, what they are trying to solve and make them intuitive.

On the positive side, abbreviations of any kind can be brilliant when used well. They can have a positive impact internally to firms, allowing people to communicate faster, but remember: what’s second nature to you and your business is unlikely to be the same as your clients or suppliers’ acronym vocabulary. Rule number one: don’t create new acronyms that are too similar to existing ones. Modern text shortening can add to the confusion, too. “Where R U?” for example, could come back as “at the ATM, ATM” (Automatic Teller Machine, at the moment).

Finally, the mind can easily play tricks on us, as the last few sentences below will prove. See if you can read them easily!

The fnnuy tinhg is taht the mnid can do smoe very srtagne tinghs and wdors and arcnomys are jsut a viehicle. Get to the piont and use tehm to yuor avandtage, not your dteiremnt. Aoivd Jraogn at all csots.