Vendor Consolidation: The Question Everyone Skips

Back in May I wrote about the shift toward vendor consolidation in trade surveillance, and the research behind it - roughly seven in ten conversations with organisations across the sector centring on active consolidation, whether already underway or under serious internal review.

Since then, the question I keep hearing from Heads of Surveillance has moved on. It's no longer really whether to consolidate. It's how to actually decide on a vendor, and that's where many conversations start in the wrong place.

The instinct to start with features

Surveillance team users in particular drive this, and understandably so. They live with the reality of these platforms every day, so which vendor covers the widest range of scenarios, which has the best user interface, presents the relevant data, integrates fastest with the existing stack, all dominate the early process. These are reasonable questions, and they need good answers. But they're second-order questions.

The first-order question is critical: what is our risk appetite, and does this vendor's trajectory match it.

A market mid-restructure

That question matters more than usual right now because, as I wrote in May, this is a market still mid-restructure, private equity active, smaller vendors being absorbed, the shape of the market three years from now still being decided – and I’d argue, largely out of view of the firms buying into it.

None of that is a reason to freeze a decision that needs to be made. It is a reason to widen what "due diligence" means, beyond the feature comparison and into the trajectory of the business itself.

Why there isn't a checklist for this

I won't pretend there's a standard checklist that solves this, and I'd be cautious of anyone who offers you one. I've seen enough procurement processes to know that the moment someone hands over a scorecard with weighted criteria, the real decision is usually happening driven by budget, by a powerful internal technology voice, or by what the Board will and won't accept if something goes wrong later. A universal framework for this decision is, by definition, selling you something simpler than the decision actually is.

The better questions

What I'd offer instead is a shift in posture: treat this less as a procurement exercise and more as a strategic bet, because that's closer to what it is.

Ask what happens to your programme if the vendor is acquired. Ask who inherits the relationship if your internal champion moves on. Ask whether you're buying technology or buying a partnership, because in this market, I'd argue it's the latter, and a partnership requires a different kind of due diligence entirely. It means looking as closely at who you'll be working with in three years as at what the platform does today.

None of that produces a tidy checklist. What it produces, if you ask the questions early enough, is a decision made with your eyes open rather than one you inherit the consequences of later.

If you're in the middle of a migration or consolidation decision right now, I'd be curious what's actually driving it in your organisation: cost, capability, or something closer to risk.