Over the years I’ve heard something like this said many times: “Well, they want a Cadillac but they really only need a Chevrolet!” This colloquialism obviously goes back to the days when GM was really a dominating auto manufacturer … but I don’t think it really has as much to do with cars as it does with human nature.

The Difference between ‘Musts’ and ‘Wants’

Most everyone I know likes nice things. We like to see them, have them, use them. Anybody who doesn’t like nice things we sometimes label as ‘out there’ or ‘different’.

Even so, there are a lot of nice things that … well … just are not really necessary. Or even useful. C’mon, think about it. You bought that fancy stereo system last year. Before doing so you really dug into the research to make sure that the one you bought was the absolute best there is, right?

Not even close. You bought the one that makes most sense for you. (OK, you really bought the next one up!). During your research you learned there are two parameters about ‘nice things’. Along one scale there is genuine quality. Some products are just made better, they have higher quality components, they offer better performance, they cost more to manufacture and they carry a higher price tag.

The other ‘nice things’ scale is all about features. The more gee-gaws the better, right? Well, in most everything you purchase – from cars to stereos – you pay a higher price for the item that offers more features. Even if it has less quality.

After your exhausting stereo system research you went through some kind of ‘mind meld’ and bought the unit with the best quality and the most features you could (almost) afford.

But here’s the rub. Have you really USED all of the features you so painstakingly agonized over during your stereo research and purchase? Or – like me and a lot of other folks in the world – did you put the main items to work and there are still a lot of unused features just sitting there? I’m betting on the latter.

This, my friends, is the difference between Musts and Wants. And I know for a fact that I’d have better quality stuff or a fatter wallet if I had known this my entire adult life. The bottom line is that many times I have bought more than I could use, only to let some of my investment go to waste.

How in the world does this relate to the field of financial technology?

In my experience, technology for financial institutions falls into exactly the same model:

  • Providers are continually pushed to add new features and gee-gaws … sometimes because the marketplace wants new features and sometimes because they can be done.
  • When buyers (credit unions and banks) survey the vendor community for a particular project, the questions are all about the features … and more often than not it is the whiz-bang stuff that gives one vendor the edge because there are more checkboxes on the page.

These phenomena even creeps into early price and estimate discussions – where the conversation usually goes something like this: Vendor: “What modules do you want to include?” Buyer: “Hey, let’s throw them all in! We really like that gee-gaw!” The result is that many conversations go no further than this point because the vendor just got asked to price the Cadillac, which happens to be way out of the client’s price range.

Focus on What You Need

Our experience is that clients underutilize the capabilities of most solutions. Regardless of what they purchased, they leave a lot of stones unturned. Looking at it from a different perspective … there could have been some money saved somewhere, probably by both sides.

My advice is for both sides to think a little differently. For us vendors … focus on features that truly help our clients and sell the steak, not the sizzle. For our clients … think about what you will really put to use. What is the problem you are trying to solve and what capabilities do you really need to fix it. Then, look for a vendor who meets that need and offers you the flexibility to adapt and expand as your needs change.

If you only need a Chevy …