Archer Insights

Innovate. Learn. Repeat.

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"So go ahead and make mistakes. Make all you can. Because that's where you will find success - at the far side of failure."

Thomas J. Watson Sr., IBM Chairman & CEO

“Let’s see what we can break today” is a playful opener I use when starting new technology projects. Like the late Mr. Watson, I believe that success can be found only at the far side of failure.

The innovation methodology known as agile development calls for innovating, testing, and deploying small changes frequently on the journey to the large-scale innovations required to secure a place at the forefront of investment management technology. We use it every single day, because it allows for the isolation of code and process revisions which mitigates the risk associated with large, multi-functional deployments.

We believe the true art of the investment management business is in finding smart, creative ways to leverage the risk/reward scale. And the challenge is in deploying this artistry into a complex and dynamic environment. With this in mind, note that the agile development innovation technique mitigates, and explicitly does not eliminate, risk. Risk elimination halts progress, both in technology innovation and in investment performance.

Mistakes are inevitable during innovation, and they come in many forms: unexpected results; unpredictable environmental impacts; oversights; glitches; and gremlins. Mistakes are naturally occurring, and that’s a good thing. They reveal opportunities for learning and further innovation.

Think about Microsoft’s ‘mistake,’ their Tay tweet bot. Shortly after was hacked with vicious consequences to its followers, Microsoft CEO Satya Nadella emailed his team: "Keep pushing, and know that I am with you ... (The) key is to keep learning and improving." Microsoft has since continued their innovation in the bot space. Inc. Magazine debriefed the experience in a recent article, noting that Mr. Nadella demonstrated extraordinary leadership, concurrently supporting his team, their work, and the victims of the hack. Nadella urged staffers to “take the criticism in the right spirit while exercising deep empathy for anyone hurt by Tay."

I wish I’d written that (keep learning and improving… take criticism in the right spirit). I have the privilege to partner with some of the sharpest minds in investment management to innovate in support of an ever-expanding universe of products. Each day, my colleagues and I face unexpected conditions, just as Microsoft did with Tay. Sometimes we make mistakes, but we - and our clients - never stop innovating.

Agile development allows us to quickly identify mistakes (we isolate innovations), fix them (we deploy small changes frequently), and reveal new opportunities for innovation (we’re faced daily with new combinations of conditions). The key for our teams both internally and across the industry is to have full confidence in our collective ability to recover from mistakes, to learn, and to innovate all over again. To coin Mr. Nardell’s phrase, to “keep pushing.”

So, shall we see what we can create today?

Robert G. Lage, CFA
Robert G. Lage, CFA
Executive Vice President, Global Head of Product & Technology

Robert Lage, Archer Executive Vice President, Product & Technology, is a founder and chief architect of Archer. With a deep understanding of financial service products and as a CFA® charterholder, he helps build solutions that enable clients to expand distribution, launch new investment products, and grow their business by streamlining operations and addressing unique needs through an agile, continuous development process.

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