Travelling the country talking at IFA seminars can provide an interesting insight into the average IFA's attitude to technology, and sometimes that of the people advising them.
Normally, I try to do no more than a couple of these per month. Last week, things went a little bit wrong as I found myself talking to Midland Life & Pensions Society in Birmingham on Monday evening, for IFA Portfolio in Coventry on Wednesday morning and at The Exchange Expo at Wembley Conference Centre on Thursday.
Speaking with IFAs at these events reinforced my view that it is not the technology that matters but what you can do with it. A classic mistake made by so many technologists is to get overly tied up in the benefits of using the latest toys and forget about fulfilling the need. At one event I was approached by a "technology consultant" asking if any credible replacements for CTP were likely to emerge. He was particularly scathing about the fact that CTP was based on relatively old technology.
When I pointed out that the New Exchange service was to be based on Sun and NT Servers using an Oracle database with Internet Explorer 4.0 as the client operating on Windows 95 or NT, the consultant's attitude was transformed. Suddenly, he could see The Exchange was a forward-thinking company using the latest industry components, yawn!
I would imagine that the above description of the New Exchange may as well be in Swahili for all it will mean to most IFAs. There is no reason why they should worry about the finer points of the technical specification. Obviously, it is encouraging that The Exchange has moved to the latest technology but it has not immediately discarded CTP because it uses an earlier version of Windows.
To identify if CTP, the New Exchange or any technology product is of value to the IFA, there are two simple questions to ask. Does it help me do my job better and can it help me provide a better service to my clients?
If the answer to either of these questions is yes, then the product is one they should be interested in using. If the answer to both is no, my advice to any company is: don't waste time thinking about it.
CTP should be a must for every IFA because it allows them to access client-specific key features' documents in minutes rather than having to wait for them to arrive in the post. It also allows them to compare projected values and for a range of products side by side on screen. As long as it does this, the technology platform is irrelevant.
CTP will, no doubt, continue for as long as it is viable to maintain it as services are moved over time to the new system. At some time, it will be phased out just as we can expect to see the end of the old videotex service once the New Exchange is launched.
It does, however, never cease to amaze me how many product providers have failed to learn the lessons of asking these two questions before developing technology.
Recently, I visited a life office which was terribly keen to show me a CD-Rom that was being created for its broker consultants to help them convey its investment performance to IFAs. It was explained that the presentation would take about 45 minutes.
When I asked how the IFA was going to benefit from investing this much time, the response was: "It will help them understand how good our investment performance is."
This comment was made with a straight face. It seriously worries me when the marketing department of any life office believes in this use of its own staff's time, never mind that of an IFA. There is no shortage in this market of independent information on fund performance, and most advisers I know would far rather carry out their own research.
The production values on the disk no doubt used the latest multimedia software tools in its development but that still did not mean it wasn't going to be a complete waste of its consultants and the IFA's time. I hate to think how much money has been wasted by product providers on projects which have delivered little or no value to the IFA or their clients.
Some companies have produced excellent IFA software. In my opinion, Zurich has produced probably the best example with its Quote Z system although others, such as Scottish Amicable and Scottish Widows, have also produced highly creditable packages.
The two questions posed above should be a test that all providers should apply before developing anything. If a project does not fulfil one or ideally both of these require- ments, the best advice I can give any provider is get some advice on how to meet these needs fast or scrap the project.
Ian McKenna is a consultant and director of The Financial Techn-ology Research Centre. He can be contacted by email at: IanMcKenna@MSN.com. Tel: 0177-359 5656, fax: 0177-359 2858.