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Pity the poor platform providers

Pity the poor platform providers

It is not easy being a provider. Not only do you have to use a BlackBerry and spend a lot of time in meetings, you also get called colourful names underneath articles on websites like the one you are reading now.

And to top it all, when you get to work on a really exciting project, like re-platforming, you get pelters from users who refuse to understand just how complex your reinvention of this particular wheel is.

The temptation for providers is to do what Apple did with Antennagate on the iPhone 4, which is to say “You’re holding it wrong”. But you know that would lead to apoplexy, and involuntary and immediate opportunities to pursue your career goals elsewhere.

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No, it is not easy. So I thought we should try to look at re-platforming from a provider’s point of view.

Now is certainly the time to focus on this. The table below shows you the (declared) replatformings on the go. There are a good few others, but we are not allowed to say who.

ProviderCurrent tech platformMoving to
Alliance Trust Savings (direct and advised)Activebank (proprietary)GBST Composer (advised complete)
AscentricBluebutton (proprietary)Bravura Sonata
AvivaBravura TalismanFNZ
Cofunds (post Aegon deal)FAST inter aliaGBST
Old Mutual WealthProprietaryIFDS
PrudentialNoneBravura Sonata
St James’s PlaceNoneIFDS Bluedoor

Source: the lang cat

Across those firms, £150bn-£200bn of client assets are moving from one place to another. And with these exercises increasing in cost and complexity, as evidenced by Old Mutual Wealth’s massive £450m project budget for its replatforming, they will be with us for some time yet.

So why should you care? If you listen to providers, re-platforming is all positive. It simply takes away the hassles advisers experienced in the past and makes things better. After all, what advisers really care about is outcomes for their clients, not the workings under the surface.

However, re-platforming is brutal – simply the hardest thing that a platform business can do. So, with that in mind, I thought I might set down some of the key challenges that providers face while going through these exercises.

1.Data migration

If anyone has tried moving back office systems, it is similar in concept. The issue is that every platform has a different ‘data architecture’ – the way it treats each piece of information within the system. When moving from one to another the system is dumb – it does not know what it does not know. So if, for example, the label for a data field which holds details of historic income distributions is called ‘dividends’ on System A, and ‘income’ on System B, then System B has no clue what System A is on about unless it is specifically told to recognise that field. That is something of an oversimplification, but if you can imagine that times 1,000, you get to the sort of logistical challenge involved. If any of you have seen data disappear after a re-platforming, this is almost certainly why.

2.Workflow and staff training