How do you know when it’s time to switch your investment technology?
It’s a question many firms wrestle with—and for good reason.
Changing investment systems is a major undertaking, one that Jonathan Balkan from Alpha Alternatives compares to building a house. Both require three essentials: Careful planning, the right resources, and flawless execution.
And, when done well, the results stand the test of time.
In a recent podcast, SS&C Advent and Alpha Alternatives discussed the challenges and opportunities of a technology transformation.
Drawing on years of experience, Jonathan shared lessons learned from delivering complex projects across front-, middle-, and back-office operations for global alternative managers.
In this post, we explore the critical steps investment firms can take to ensure a smooth transition and implementation today, while building a solid technical foundation for long-term success.
Defining Your Roadmap: Technical Success Depends on Clarity
For many investment firms, the first—and often biggest—challenge in considering new technology is simply knowing where to begin.
A suggested first step is engaging an objective advisor who can provide a clear, unbiased perspective on the firm’s needs and priorities. This could be a technology consultant, a prime broker offering operational insights, or even an operational due diligence specialist who understands investor expectations. The goal is to have someone who can ask the right questions and guide the evaluation process without being tied to a specific function.
No matter which advisor you choose to work with, the evaluation process typically begins by stepping back and gaining a holistic view of the firm’s operating model. This means examining existing resources, including people, processes, data, and technology, to clearly define how the firm functions today.
Next, gather all stakeholders together and answer foundational questions: What’s working, what’s not working, and what type of solutions are needed to get the firm to where it wants to go.
Answers to these questions provide the foundation on which a firm can build its search for the right technology.
Structuring the Evaluation Process: Getting the Most Out of Vendor Demos
The detailed requirements developed during planning should guide the next phase of the process: Vendor evaluations.
These demonstrations are a valuable way to compare solutions, but Jonathan emphasizes the need for structure and consistency.
He explains, “One effective approach is to use a demo script that walks through the full lifecycle of an investment, investor, or transaction. By requiring vendors to follow the same script, firms gain an apples‑to‑apples view of usability and functionality that reflects your firm’s day-to-day processes.”
Teams should clarify which features and functionalities are mandatory vs. nice-to-have and use a scoring matrix to document priorities after each demo.
Beyond functionality, assess vendor culture, reputation, and long‑term vision. Does it align with your firm’s future direction? And don’t overlook total cost of ownership— fees for licenses, service, upgrades, and internal resources can add up quickly.
Jonathan notes that while vendor demos are designed to impress, there are certain warning signs that should raise concern.
A quick “yes” to complex requirements without understanding the nuances and showing how they’ll be met often signals unrealistic promises. Vague product roadmaps, limited API integration, or outdated architecture can also indicate future challenges.
Poor responsiveness during the sales cycle, high staff turnover, and a lack of references from similar clients are additional red flags.
Technology partnerships are long-term commitments, so ensure the implementation plan is practical, includes realistic timelines and a clear handoff from sales to an Implementation Consultant.
Building the Right Implementation Team
Once the evaluation process is complete, the focus shifts to implementation. When done well, this stage of the process is an opportunity to take a fresh look at your firm's processes and optimize your practices.
To start, it's essential to define roles and responsibilities clearly. Most vendors will prepare a detailed project plan outlining their tasks. These plans often include the responsibilities for the firm, such as delivering business requirements, providing reconciled and structured data for upload, or defining report specifications.
In reality, Jonathan says that the firm's role should be far more extensive. Instead of relying solely on vendor resources, firms must build their own change-implementation team that can support the transition effectively and ensure future processes and data flows are aligned with the new technology.
Most firms are typically staffed to run the business as it exists today, not how the firm will operate with new technology. To gain that vision, Jonathan recommends that firms engage an outside perspective to help with implementation and ensure the value of the new technology is realized.
Final Thoughts: Plan Today for Tomorrow’s Success
Successful technology projects start with a clear plan and a long-term vision. Every decision—whether selecting a vendor or defining an implementation roadmap—should align with your firm’s broader strategy.
To dive deeper into identifying technology needs, managing vendor expectations, and building a winning implementation plan, listen to Jonathan’s interview on the Tech It Up Podcast: “From Evaluation to Implementation: The Dos and Don’ts for Selecting a Technology Vendor.”
Contact us to learn more about switching to a new investment system.
