I recently looked at the way in which mobile technology is supplanting the PC in people’s lives. This raises important questions over the future shape of adviser software.
Since the dawn of the PC nearly 30 years ago, what used to be called back-office systems, more recently known as client management packages, have dominated the adviser software market.
There has been a move from client/server environments to web-based software as a service propositions but if the new world is going to be mobile, is this the best course of action for advisers?
In the last couple of years, client front-office services – what we would previously have called point-of-sale before that became politically incorrect – have played a bigger role and, in future, with the focus on customer service, these must be a crucial component of any proposition.
Meeting the needs of the retail distribution review, particularly the higher level of regulatory reporting, and the need for integration with platforms and packaged product providers, means even the bigger industry players have a huge list of development requirements.
As consumers increasingly look for small slices of information, there are arguments to be made for standalone components, as long as they can interact seamlessly, without the need for substantial rekeying of data.
Delivering this is difficult and it is a lack of ability of systems to communicate efficiently that has constrained e-commerce in the last decade.
An ideal scenario might be one where advisers are able to select from a range of best of breed solutions to deliver planning tools, consumer aggregation, asset allocation and portfolio modelling and a range of other services from multiple suppliers.
It would be crucial to recognise there are some parts of the process that cannot be separated, for example, attitude to risk tools, risk tolerance and portfolio modelling applications bring with them especially complicated challenges and are almost certainly best sourced from a single supplier.
It will also be necessary to ensure the impact of such tools are fully reflected in other forms of planning tool.
It is more than a year since Time 4 Advice announced its intention to leverage the Microsoft Dynamics platform to deliver specialist components on top of an industrial-strength CRM platform.
The rationale that it would enable faster deployment seems compelling. However, I would have hoped to have seen a product on the market by now. I hear rumours it is getting close and this would demonstrate that the concept works.
A number of the smaller software vendors, such as Plum Software and SSP, are concentrating on integration with a range of partners, for as long as they need to build ind-ividual integrations the pace of change will be constrained.
At a time when the adviser market is facing an unparalleled challenge from self-service and other automated solutions, there is an urgent need for the industry to be more nimble.
Maybe the way forward is to develop better communication and security infrastructures between complementary applications that could be embraced by a range of software providers.
Important work has been done in the last six months by Origo, culminating in the recent delivery of its pre-population standard.
It is a shame this was not delivered a decade ago when some people, myself included, were arguing it was crucial to the success of e-commerce. I will be making the extent to which product providers adopt this standard one of the key criteria for measuring their propositions in future.
Delivering this work should put Origo in the best position to embark on a wider standards activity that could embrace a comprehensive communication capability for all adviser software. But it would not be fair to expect Origo to develop such capability alone as it would undoubtedly need wide-ranging external support.
To achieve the desired connectivity, it would also be crucial to address security concerns that are emerging over the use and reuse of data in financial applications. Having the right security infrastructure in place between applications that talk to each other will be necessary to maintain market, regulatory and consumer confidence.
Too often, the industry has allowed single dominant suppliers to emerge and this has constrained innovation and stifled competition. We need to learn to support a small number of strong competing initiatives if we are to create a dynamic industry.
An added advantage of using a range of component suppliers would be the reduced reliance of adviser firms on a single software supplier. That said, it is still going to be good practice to have a single court data repository, so the role of the client management software provider is likely to be pivotal.
It is time to start writing the first drafts of the obituary for PC-based computing and begin serious planning for how our industry can embrace the mobile platform as the third generation of computer technology.
In doing so we need to learn from the mistakes of the past and establish the right foundations for the future. If we try and move forward in the mobile world based on strategies created for the PC we are inviting failure. This should be an opportunity to review how much of the way we work today is fit for purpose for the needs of the next decade.
Ian McKenna is director of the Finance & Technology Research Centre