While the attractions are pretty obvious, I am not sure that anyone has thought hard enough about functionality mirroring and the consequential brake on innovation that would ensue. It is like Facebook slowing down because it is waiting for Hootsuite to catch up. Even if the technology overcomes the massive gulf between aggregation and asset aggregation – as first mooted by platform consultant Stan Kirk – advisers need to also consider the substantial issues around data ownership, freedom of movement and governance. It is quite one thing to trust an unregulated software company to display a load of data. Expecting the same organisation to take responsibility for operational matters, integration indemnities and such like is quite another.
As an aside, I gather that migrating from one back-office system to another is a lot less straightforward than moving assets from the most legacy of providers to the most modern of platforms. As adviser businesses continue to become more operationally tight and client data ownership (and its security) move up the agenda, this may become a bigger issue.
Overall, this remains a tricky area and due diligence tools are patchy. My advice? Be clear and confident in what you are aiming to deliver for your customers, be cynical towards sales pitches and choose the solutions that are most likely to be aligned with outcomes you are shooting for.
David Ferguson is chief executive of Nucleus
