Big single tech platforms dominate our lives but they’re not necessary

27 March 2019

It’s not even 9am and I’ve already browsed digital versions of newspapers, emailed from my google account, checked social media and downloaded some music onto my phone during my morning commute.

You might assume, therefore, that I am in thrall to the global technology giants and their products. You would be right, to a point - but it doesn’t mean I’m comfortable with it.

I’m far from alone in being frustrated at feeling so tied to their way of doing things. Google and Facebook in particular have suffered a backlash over the past couple of years, not least for their role in data privacy, user experience standardisation and fake news controversies. Yet they remain dominant in their markets and many of us continue to depend on them to a frightening degree, despite their one size fits all strategies.

That’s because, as platform businesses, they meet a need - but it comes at a cost, as many of us continue to discover. When it comes to technology providers, big single platform tech isn’t necessarily best. That applies as much in the financial services industry as anywhere.

I started my journey in the wealth management sector during the pre-mobile phone era and when email was still only widely used in the academic sector. Interestingly however this was probably the very period when wealth management was delivered through the most bespoke and personalised service. The technological changes we’ve seen since then are simply staggering, from the evolution of the internet and the emergence of social media to smartphones and the rapidly increasing sophistication of AI, and have rendered that old wealth management model unwieldy and unscalable.

Client expectations over use of technology have evolved and grown accordingly, however their desire for a high quality personalised service has not changed at all. This makes it surprising to see the dominance of large single technology platforms focused on scale and simplicity.

The Multrees investment platform cut its teeth in 2011 servicing businesses advising HNW, UHNW and institutional clients, probably the most demanding in terms of the way buying power can dictate service quality and customisation. And the challenge was to deliver this level of quality and customisation at scale, so we developed a multi component, open architecture, technology strategy that allows us to tailor a service to each adviser firm and its clients, while retaining core processing scalability.

One of the great paradoxes of the technological revolution is that the companies which have become household names, are also the problem. Big technology has become too big, and that goes for the wealth management sector too. Despite rapid technological advances, flexibility and the tailored experience is somehow still secondary to the one-size-fits-all culture of the traditional service and technology providers.

I can see how we got here. With the industry maturing rapidly, firms feel pressure to adopt technology that meets every need. The value of being able to really excel in any one area – and differentiate yourself in the process – is too often overlooked or forgotten.

The traditional service and technology providers have so far succeeded in convincing the wealth management sector that their technology, their methodology and their processes are the only way forward. But firms and their clients are paying a price for this – even if you ignore the disruption, the costs of implementing and then aborting projects which ultimately damage reputation, the ability for users of single large platform tech to differentiate their proposition in a crowded market is extremely limited.

In the early days of Multrees, our alternative strategy nearly killed us as we underestimated the complexity our architecture brought. However, driven by the near-constant shift of investor expectations, regulatory developments and technological innovation, we believe the emerging success of this approach offers a viable alternative to the one-size-fits-all culture. As an adviser, you can use one platform, multi-platforms, or now you can actually have your own private platform that will allow your business to scale whilst retaining all of your important differentiators.

Digital capabilities allow for a much more bespoke and nuanced approach. Firms partnering with a services provider want to retain a sense of control rather than lose it; after all, it’s their company’s reputation on the line. They want flexibility, expertise and a relationship dictated by their needs and not by the restrictions imposed by the provider’s culture and structure.

We know that different firms have different priorities, needs, strategies and styles, so it should be equally clear that service propositions must be individually configured. Big technology is becoming an anomaly at a time when companies need to be nimble and capable of evolving in line with their clients.

One size certainly does not fit all and shoehorning your proposition into our own isn’t going to serve either of us. In 2019 it’s increasingly apparent that being beholden to the traditional service and technology providers, and their insistence that their way is the only way, is both constraining and disruptive.

Big tech doesn’t empower you - it controls you. I realise that my daily technology consumption is dictated far too much by the preferences and capabilities of a small handful of very large firms.

Financial businesses in thrall to the technology they use and the traditional providers to whom they cede control are taking a similar risk - and one they cannot afford.