Time to upgrade

Technology offers an excellent opportunity for brokers to reduce the cost base by automating the more mundane tasks and help increase revenue by allowing client banks to be mined for sales opportunities. However, in many cases, too much emphasis is placed on the data, which can be recorded, and too little on the ability of the software to provide meaningful information in line with the needs of the business.

The regulatory regime under the Financial Services Authority will focus on the systems and controls adopted to process the business broked. A system that is successfully and correctly used by staff and produces accurate management information is far more valuable than a sprawling database allowing every conceivable entry. Training is often a swift and more effective solution than changing the back-office system wholesale. Having said that, there is no doubt that many brokers are now using systems developed many years ago, which will struggle to cope with future change because the technology is outdated. Brokers in this position ought to start sourcing a new system now, as it might take longer to find, set up and get used to than initially anticipated - especially where existing data has to be migrated. Web-based systems are likely to be the most adaptable over time.

The crucial point from both the FSA and a commercial perspective is proper use of the chosen system. Investing time in the staff that use it can be more important than the choice of system itself.