A unified IT platform is not a network necessity

James Sharp's article (PB, November, p34) threw up some interesting questions about the ideal methodology for a network.

Small to medium-sized brokers invest significant parts of their expenses in technology. Even with easy terms to buy the kit there is a substantial monthly outlay for the software. That software makes their job possible, particularly in screens-driven, personal lines products. By definition, a business must have a system to transact by electronic data interchange.

However, I would like to take issue with Sharp on his assertion that the only successful way of doing business via or with a network is through a unified technology platform.

I find it surprising that so many network offerings want to change brokers from one IT supplier to another without a clear stratagem of benefit.

In addition, it seems to have escaped attention that brokers joining such networks will still have the residual part of their existing IT contracts to run. This could be anything up to three years and the costs can be onerous.

And then there is the thorny issue of data transfer. Some say this is easy but anyone who has tried may disagree. To boot (pardon the pun) such data transfers often do not take historic or archive data with them. Doesn't the broker have to keep records for possible audit purposes? And there is also the issue of keeping accurate records in line with the Financial Services Authority's requirements.

If these records do need to be kept, the previous software supplier is unlikely to handle this service free of charge, unless they are exceptionally philanthropic. And brokers must appreciate that replacing a computer system can create a sea change in the work place, involving a considerable amount of effort and resources to satisfactorily implement the new system.

I suggest that brokers proposing to join a network should seek information about possible costs, hidden or otherwise. Brokers must choose a network that will add value to their particular way of doing business, offering them an opportunity to take costs out of the business equation rather than add them in.

In a nutshell, why should brokers have to invest yet further into the complexities of technology to receive benefits? I don't believe that James Sharp has come up with a convincing argument.

Lloyd Hanks, Managing director, Camberford Law Network.