Advisers have upped their expectations of platforms and are increasingly impatient about clunky obsolescence.
Symptomatic of this shift in attitudes is that most advisers now regard e-signatures and paperless processes as expected practice. Many now refuse to place new business with platforms that adhere to such outdated and time-wasting habits as paper forms and wet signatures.
Covid accelerated change by forcing platforms to make processes slicker and more digital. The adviser platform market was not notable for competition or innovation and there was relatively little switching. Advisers tolerated and even enjoyed the familiar old features and practices of the platforms they used.
The highest-rated platforms for their ‘ease of doing business’ are Parmenion, the P1 Platform and Fundment
But the pandemic forced platforms and their users to introduce changes that both advisers and their clients started to value, exposing the shortcomings of those reliant on paper-based processes.
Some of the newer and more technologically-inclined platforms jumped at the opportunity to market automated and paperless processes as a point of differentiation. These platforms successfully piqued advisers’ interest and many of them liked the experience.
The highest-rated platforms for their ‘ease of doing business’ as of our most recent Platforum User Leaderboard (as part of our UK Adviser Platforms: Platform Selection report) are Parmenion, the P1 Platform and Fundment – the latter two of which are newer entrants to the platform market.
Another thing these newer platforms have in common is improved interfaces. Plenty of legacy platforms still look just as they did in the mid-noughties. They may have reasoned that there was little incentive to invest in upgrades, given that enterprise software often prioritises functionality over appearance (and, anyhow, everyone else looks just as bad).
Advisers have questioned why new operations with modest balance sheets can build slick and easy-to-navigate platforms while the industry behemoths have lagged behind
Newer platforms are usually designed to be ‘digital-first’ rather than the result of grafting digital processes onto legacy paper systems. Their interfaces look and behave like a modern website. The current top performers for their ‘general web usability’ are the P1 Platform, Parmenion and Fundment – the same three as above. Indeed, across all platforms, scores for ‘general web usability’ are highly correlated with those for the ‘ease of doing business’.
Advisers have questioned why new operations with modest balance sheets can build slick and easy-to-navigate platforms while the industry behemoths have lagged behind. The larger companies may be less nimble, or perhaps it’s because most legacy platforms are built on third-party technologies.
Regardless of the challenges, change is happening. For example, Abrdn’s AdviserOS will bring together Wrap, Elevate and FundZone assets on a single platform, with a new interface and a significant simplification of processes.
Advisers tell us they are seriously concerned about how their clients experience the platforms they use
Embark – now the Scottish Widows Platform – has gained new functionality and a fresh interface to accompany migrating assets from Advance. Even platforms with already excellent functionality and usability may now feel pressured to modernise their user interfaces.
Advisers tell us they are seriously concerned about how their clients experience the platforms they use. Portals and investment reporting are key contact points for advisers with their clients and expectations have been shaped by experiences using services from Google, Facebook and Amazon. Advisers are increasingly aware that an old-fashioned system is unimpressive.
Younger investors are particularly prone to judging businesses by their digital presence. Most advisers are targeting intergenerational wealth transfers, but many of the younger generation have grown up in a world of low-cost (or free) direct-to-consumer investment services with good self-service functionality and attractive interfaces.
They are bound to question the overall value they’re getting from advisers if they’re paying a premium for the privilege of receiving uninspiring reports on clunky portals not accessible through mobile apps.
More rapid change will come from consolidators seeking efficiency and profit
Change is happening in the adviser platform space. Experiences during and after the pandemic opened many advisers’ eyes to new possibilities, and client demand is driving higher standards. More rapid change will come from consolidators seeking efficiency and profit, as well as startups with new ideas who are unencumbered by legacy technology.
New entrants will continue to disrupt the market, but some of the old ones will modernise and thrive. And with any luck, the use of artificial intelligence for programming will render progress towards better platforms much faster and cheaper than in the past.
William Moss is an analyst at Platforum
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