The Traveling Salesman's Lament
Is the line between good and bad really brighter than it seems?

It was an American traveling salesman, Elbert Hubbard, who supposedly coined the phrase, "There is a thin line between success and failure."
Our man Elbert was a colorful guy: he made good money selling soap and in publishing, fancied himself an amateur philosopher and anarchist, was associated with the American Arts and Crafts movement, and then died as a passenger on the ill-fated RMS Lusitania.
Thin line, indeed.
I was reminded of that this week as we began preparations for the 2015 Waters Rankings awards, and for that matter while editing an opinion piece presented to BST by Matthew Taylor, who heads up asset management IT at one of the more exotic managers to grace our pages: Saudi Arabia's NCB Capital.
Staying Power
Why pay the same untold thousands (or millions) when your competitor is getting far greater value out of their deal— especially when asset management is a space in consolidation?
So, as far as financial technology is concerned, just where does success really come from? Does it really teeter on a razor's edge?
Well, what can the Waters Rankings tell us? They're a bit of a different animal than our other awards. One obvious distinction is that they're determined by our readers, rather than by judges. But beyond that, they're also more of an affirmation of ongoing quality, rather than a contest where dramatic year-on-year progress, or a particularly strong implementation case, can sway the outcome (this regularly happens, for example, at our American Financial Technology Awards, which will be held later this year).
Sure, that means the Rankings' outcomes are based extensively on brand — more users naturally mean more potential voters. But then again, brand comes from somewhere ... as does the occasional upset every year. Nothing lasts forever on its own.
That same kind of sentiment permeated Matthew's column from the user perspective: proper vendor management goes well beyond the occasional update or cursory email about a core system improvement. It involves investment, well-defined frameworks, institutional persistence, and just a little bit of self-righteousness, too.
I was particularly surprised by his illustrations about the same exact service or interface looking entirely different from one implementation to another, based on the client's level of engagement a few years down the line.
Why pay the same untold thousands (or millions) when your competitor is getting far greater value out of their deal—especially when asset management is a space in consolidation?
It seems service level agreements have a pretty quick half-life.
Great Expectations
As my colleague Anthony Malakian pointed out when he read the piece, Taylor seems like a real stickler. Is he?
My response: I'd bet most successful CTOs are known for their great expectations; some might even be (borderline!) pains in the butt. It's one reason some of the most well-respected chief technologists we speak to at Waters aren't tech guys by training but rather accountants or lawyers, who love going through every last line of contract with a fine-tooth comb, and never forget what they've been promised.
In the heat of the moment, whether on the vendor side or in-house, that line between success and failure may well seem small. Especially on the buy side, one system and another can look essentially identical, with price or reputation or other subtleties ultimately deciding the choice. No doubt, the stakes are high.
And after that decision is made, while managing these relationships internally and over time, it's surely tempting to think 'good enough is good enough, for now' — but tell that to the poor souls on the Lusitania.
In the end, the line might be far less thin than we generally think. As the years accumulate, it grows thicker. I'm guessing most Waters Rankings voters would agree.
Quick Thoughts
- More than enough ink has been spilled about the NYSE outage last week, and almost everyone seems to agree it was a victory for equities markets fragmentation (mostly because, reportedly, no one lost any money). Now a full week on, we still haven't heard about the mysterious ICE software update that actually caused it. I just wonder how many "proponents" of fragmentation this week will be back out there next week on the anti-HFT trail.
- How Greece is still in the Eurozone, I'm not sure. Why the continent continues to put up with this predictable, never-ending crisis cycle, I'm even less sure. But at some point, without any actual debt restructuring and continued pain inflicted upon the voting public, its creditors will eventually find themselves dealing with Golden Dawn. And that won't be pretty.
- Speaking of which, now seems like a good time to reassess whether working the markets in mainland China is a good idea. Hong Kong — whatever its low-simmering political activity — is looking pretty palatable at the moment.
- Hipsters and lumbersexuals notwithstanding, the Pacific Northwest is supposed to be beautiful. But I would avoid moving there.
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