(City Wire) - For this week’s Ask the Experts page, Anton Padmasiri talks us through three trends that could reshape your proposition. Formerly an associate product director at Fidelity International, Padmasiri created the WealthOS wealth management platform to offer greater flexibility to wealth managers, either through the provision of an entire platform or through modular plug-ins that can be integrated within existing platforms. Here, he explains why we should keep track of the technology that facilitates disruption.
The wealth management industry is in full digital transformation mode. When a disruptive idea becomes mainstream and incumbents move towards adopting it into their strategy, some incumbents may pay too much attention to the actual disruptive product trying to imitate it, while paying little attention to the disruptive enablers.
This offers limited gains, as it is the enablers that actually cause the innovation. The product is just the output. There is a reason why Robinhood is happening at a time of the smartphone, cloud computing and ubiquity of open APIs. To ignore these critical factors in any digital transformation strategy, and purely try to emulate disruptors on top of legacy technologies, can be disastrous.
It is imperative to pay close attention to the technology that enables disruptive pioneers to reimagine new product experiences. In a digital-first world, we believe it is not just the chief technology officer who must be aware of these tools, but every decision-maker in the organisation.
If you know about the evolving tech landscape and are willing to adopt the right tools, you are more likely to be able to adapt your value proposition with speed and agility. Client expectations can change fast, and you do not want to be tied to technology that is already 20 years behind. While it is mobile-first now, it is not inconceivable that virtual reality and augmented reality might replace that soon. Having the right technology foundations is critical.
Here are the three important technological breakthroughs that increase the level of digital agility in wealth management, that I think are key for leaders of the industry to be aware of:
1. The public cloud
The public cloud allows third parties to provide computing services and infrastructure to businesses and organisations via the internet.
What AWS has done (followed by Google GCP and MS Azure) in advancing cloud computing is truly revolutionary. What started as a pay-as-you-go storage service (S3) and a virtual computing service (EC2) now offers a one-stop shop to ideate, build and run any type of computer application with nothing but a laptop and internet connection. It is not so much a lowering of barriers, but rather a complete destruction of them that has paved the way for explosive innovation. The sharing of resources and the automation of infrastructure provisioning to exactly match the application’s scale has eliminated layers of planning, development and associated costs.
2. Flexible APIs
API stands for application programming interface. An API allows two applications to share information and communicate.
APIs have been around since the emergence of computing, but it has entered the general parlance over the last few years in phrases like the ‘API economy’. The reason for this is the advent of a new generation of Open API designs that even non-techies can use to visualise digital features. The most popular of these is the Rest standard APIs, which are incredibly flexible. More recent innovations such as the GraphQL standard have further improved on this. These new designs allow the digital front-end to be connected to the back-end very easily by carrying data and commands between the two through programming.
3. Low-code/No-code: Low and no-code platforms enable people with limited knowledge of programming and coding to create software and apps.
The advent of LC/NC tools combined with open APIs offered by modern applications is reducing the need for armies of developers and the time it takes from ideation to implementation. Companies such as Wix provide great tools to develop simple websites without developers. Taking this a step further, companies such as Bubble are offering entirely LC/NC tools to build fully-fledged web applications that interact with other applications.
The good news for the wealth management industry is that more and more wealth technology solutions are coming to the market that use these advancements to help organisations develop future-proofed value propositions at a significantly lower cost and in less time. Leaders must hold suppliers accountable by carrying out thorough due diligence on whether their solutions are truly leveraging these advancements for the client’s ultimate benefit.
By Ian Horne
