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5 MIN READ
FINTECH

What is the “Cutting Edge”, and Why Does It Matter to You?

What is the “Cutting Edge”, and Why Does It Matter to You?

FINTECH

“How are you staying on the cutting edge?” As a Software-as-a-Service provider, this is a question we are asked (and which we ask ourselves) on a daily basis. Or, to put it another way: “How are you using the newest technological discoveries in your product?”

The answers to these questions have significant consequences for our clients, as well as for the Clearwater teams behind our daily operations. In fact, I think the very act of asking of these questions – the desire to know how we are innovating – tells us something about being on the cutting edge.

The implication behind these questions is that there is something important and positive about embracing new technology. The scientist in me wants to validate this assumption that we place so much stock in. So, let’s look at innovation, and ask why it’s so crucial that never stop pushing forward. What is “the cutting edge?” Is newer technology always better technology?

New Technology Can Be Risky

The assumption underlying the titular question is that there is something inherently good about engaging with new developments. But aren’t there risks involved in jumping headfirst into new technologies? 

Of course! New technologies are often evolving at a blistering pace. This means that what works today may be replaced tomorrow. They are sometimes unstable. It takes time for a new technology to come into its own and attain the level of availability and support expected of enterprise-grade solutions. New technologies are often implemented unevenly, which means there is no established “right” way to do something. You can’t take advantage of years’ worth of well-established and well-tested patterns.

Not all new technologies will be right for your problem either. The goal should be to choose the right technology for a given task. New technology should not become an end unto itself; I’m a strong opponent of novelty for novelty’s sake.

Old Technology Can Be Risky, Too

While “new” doesn’t necessarily imply better, neither does “well-worn.” We also need to recognize that there are risks inherent to old technology. 

New technologies are motivated by problems with older ones. In some cases, new technologies highlight problems in older technologies that we didn’t even know we had. Someone else recognized an opportunity and built a solution – why not build on what they’ve learned?

New technologies change expectations. You can’t simply ignore them because you will be forced to contend with them. Consider increases in internet speeds moving from dial-up to broadband: what used to be considered a reasonable page load time is now utterly unacceptable. If a new technology increases the speed of a process 10x, people will soon come to expect 10x speed. You can delight people with the speed increase now, or you can disappoint them by moving slowly later. There is no applause for implementing something five years too late. 

Older technologies can also become a maintenance nightmare if left in place too long. In a recent unfortunate example, we saw stories about COBOL developers called out of retirement to fix struggling legacy systems stressed by the Covid-19 pandemic. As something new becomes industry standard, finding people and infrastructure to support something old becomes more challenging and more expensive.

One of the biggest risks to sticking to old technology is complacency. Technical complacency can cause attitudinal complacency, and attitudinal complacency can kill an organization. The inability to use the best technology for a task wears on problem-solvers. Complacency about technical solutions can cause complacency about other aspects of system performance. Even where the technical stack remains solid, you have communicated to others that you will not stretch outside of your comfort zone to solve a problem correctly. Those others will begin to wonder where else you have gotten too comfortable.

How We All Benefit from the “Cutting Edge”

Clearwater staying sharp drives the best results for our clients. It’s how we deliver timely, accurate data, day in, day out. It helps our clients anticipate and react to changes. It helps our clients stay ahead of their competitors.

Staying on the cutting edge with new technology also benefits us as an organization. It helps us attract the best talent, who in turn keep us moving in the right direction, away from complacency and ahead of our competitors. It’s difficult to catch someone who never stops moving forward.

Mission, Vision, and Action

Ultimately, staying on the cutting edge is about how we see ourselves. We don’t want to be good enough. We don’t even want to be great. We want to be the best. Clearwater’s mission is to “Harness the latest technology to be the world’s trusted source for automated and comprehensive investment accounting and analytics.”

It’s one thing to want to be the best. It’s another to take concrete steps to make that happen. Staying sharp requires staying actively alert to the possibilities offered by new technologies. It means taking the time to constantly educate your organization. It means having dedicated space to experiment with new applications. One way in which we have been putting our motto into words is with our “Machine Learning Everywhere” initiative. 

As a member of the data science team, this initiative is near to my heart. In my next post, I’ll be sharing what this project entails and how we have built an action plan around machine learning within Clearwater.

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