Business

Controlling the controllables.

Published

1 year ago

September 13, 2022

admin

Simon Tombs is Managing Partner of Monahans,

Wouldn’t it be great to have crystal ball? Although even with one we’d have been hard pressed to predict the turbulent times we – individuals and businesses – would face since March 2020. In two and a half years, the COVID-19 pandemic changed everything and agility has become a business’s best friend.

The true test of a company comes in weathering a storm. Brexit, COVID-19 and now the war in Ukraine have all collided to form the ‘perfect’ storm for businesses, with soaring energy costs, unprecedented difficulties for supply chains and unmanageable staff shortages as the workforce tries to navigate the changes of the last two years.

But, as there’s calm before a storm, so will there be after. It may be a little optimistic to say that it’ll be plain sailing from here but what we do have now that we didn’t have before is the knowledge gleaned from these events. Looking back and drawing learnings will give businesses and individuals a better ability to be in control in the coming months. And control is key, especially in such uncertain times.

With so much out of our control, it’s important not to get overwhelmed. Rather, taking command of what you can control, amidst other uncertainties, will ensure you retain a solid grasp on how your business is running.

Cash is king

The first thing to take control of is your finances. By having a clear understanding of your cashflow, you can dictate what you might need to tweak and adjust in your spending, should tricky situations occur. Cut back where necessary to avoid debt and ensure you keep your future projections in the green.

Projection may lead to pivot

Once you’re confident that your finances are in a stable position, don’t just sit back and rest on your laurels. Even in positive economic times, projections should be constantly assessed to ensure they are relevant, and when markets are in flux, they should evolve accordingly. Keeping an eye on how your projections are materialising will give you a steer on how you might need to adapt business strategy, even pivot where necessary.

Information remains critical

Alongside projections, historical data gives you powerful insights into past events, allowing you to make calculated decisions about future ones. By taking detailed financial reports and tracking up-to-date information, you can build a useful reference for how your business has performed in the past and adapted to previous situations. This information – and how to use that information – is critical to forming a complete picture of your business operations, whether it’s insights into your demand cycle, parts of your business that may be more vulnerable to fluctuation, or your margins as a result of price increases.

Alternatives to wage increases

Rising inflation – to the highest we’ve seen in 40 years – means that the workforce is increasingly worried about the cost of living and is turning to employers for financial support. But we risk accentuating the problem and prolonging inflation if we’re too quick to increase staff salaries – if that is indeed an option.

Instead, it’s worth considering how else you can put more in employees’ pockets with a range of options available, many of which provide tax-free support. Childcare vouchers, benefits in kind, fuel allowance support, gym memberships, maybe even buying your staff lunch once a week – there are a multitude of ways, aside from just wage increases, in which individuals can be supported over the coming months.

Retain, rather than recruit

As the purse strings are tightened, some may encounter problems with staffing, but keeping your staff happy is one of the most crucial pinch points of running a successful business. It’s far more expensive to hire talent than it is to retain them, especially in a market where skills gaps are an issue, so a key focus should be on empowering staff and ensuring they feel valued. As mentioned above, this isn’t as simple as offering pay rises across the board. Your culture must promote collaboration and growth, otherwise these will be sought elsewhere.

Communication is critical to such a culture. And it’s a two-way street – staff want to be kept in the loop about business decisions and also feel like they are being heard when offering their ideas or voicing their concerns. By maintaining a dialogue you will better understand your employees’ emotions and be able to act accordingly. Look after your best asset – your people – and they will look after you.

Don’t be afraid to ask for help

Even with complete clarity on your cashflow and a collaborative company culture, there’s still no shame in asking for guidance to ensure you’re staying on track. Business advisors, who speak to hundreds of businesses every year will have invaluable experience of how economic cycles work and the nuances of your sector. They can be a sounding board for your projections and advise on how other businesses are navigating issues like shrinking margins.

At Monahans (https://www.monahans.co.uk/), this isn’t the first time we’ve been through challenging times and economic uncertainty. We’ve been at the heart of our local business communities for more than 120 years, working shoulder to shoulder with our clients, using our vast experience and knowledge to see them through difficult times.

A lot will be out of our hands in the coming months but businesses that equip themselves with the right tools to control the controllables will be the best placed to succeed in an uncertain and volatile environment. Meanwhile, our door is always open to discuss how we can help you to stay in control of your business.

Up Next

Web3: How Close Are We to a Whole New World Wide Web?

Don't Miss

Redefining customer experiences with seamless insurance

Business

In-platform solutions are only a short-term enhancement, but bespoke AI is the future

Published

14 hours ago

September 27, 2023

editorial

By Damien Bennett, Global Director, Principal Consultant, Incubeta

If you haven’t heard anyone talking about artificial intelligence (AI) yet, then where have you been? Conversations about AI and its advantages to society have been a key talking point over recent months, with advances being made in the generative AI race and ChatGPT opening a whole plethora of possibilities. Many have highlighted the advantages of AI, but notably it’s ability to create human-like content.

But these discussions have only scratched the surface of what AI is capable of doing. It is for far more than just essay writing, adding Eminem to your rave and photoshopping dogs into pictures.

In marketing, we have been using AI for years, for everything from analyzing customer behaviors to predicting market changes. It’s enabled us to segment customers, forecast sales and provide personalized recommendations, having a huge impact on how our industry works.

It is even, for the more savvy marketers of the world, becoming a key tool in maximizing budget efficiency – which is apt, considering over 70% of CMOs believe they lack sufficient budget to fully execute their 2023 strategy.

Now, as AI becomes more intelligent, the number of efficiencies it can unlock continues to rise. Not only can it help brands get the most out of their available resources and identify any areas of waste, but it can also help highlight new opportunities for growth and maximize the impact of your budget allocation.

The trick, however, is to veer away from the norm of using in-platform solutions with a one-size-fits-all approach and create your own, bespoke solutions that are tailored to your business needs.

Pitfalls of in-platform solutions

In-platform solutions aren’t by any means a bad thing. In fact, built-in AI tools have become increasingly popular, owing to their ease of integration, user-friendly interfaces and minimal set up requirements. They come pre-packaged with the platform, offering the user the ability to leverage AI technologies without the need for in-depth technical expertise or the upfront cost of building a solution from scratch.

However, the streamlined and accessible nature of in-platform AI solutions comes at the expense of complexity and customization. They are designed to serve a broad user base, but for the most part are built using narrow AI solutions with predefined features and workflows.

This makes them great for assisting with common AI tasks, but they lack the flexibility to tailor functionality towards unique business requirements or innovative use cases, limiting the potential efficiencies and cost savings that can be unlocked. Additionally, if a business’ competitors are using the same platform, they are probably using the same AI solution, meaning any strategic advantage gained from these will be reduced.

Bespoke AI solutions, on the other hand, may carry a higher initial investment – but can offer a significantly more attractive ROI over a short amount of time.

Why customized and adapted AI is the key

The difference between bespoke AI and in-platform solutions is similar to that between home cooked food and a microwave meal. Yes, it is more time consuming to prepare, and yes it likely carries more of an upfront cost, but the end result is going to be far more appealing and will carry more long-term value (financially… not nutritionally).

That’s because bespoke solutions, by nature, will have been tailored to address your brands specific needs and challenges. These custom-built tools allow for much greater efficiencies by streamlining workflows across different channels, automating more complex tasks, and providing deeper, more relevant insights.

The increased level of optimization can significantly improve productivity and reduce operational costs over time, offering a higher ROI. The increased flexibility of bespoke AI also allows brands to implement innovative use cases that can significantly differentiate them from their competitors.

The data analyzed can be specifically chosen to match business requirements, as can the outputs of the AI tool, providing a significant advantage when understanding and acting on the insights provided.

Additionally, these tools are, by nature, more scalable. They can be updated, upgraded and expanded as needs change, ensuring they continue delivering value as the business grows. They can also be designed to integrate with any existing IT infrastructure, from CRM systems and databases to marketing platforms and sales tools – leading to more efficient and effective decision-making.

Managing finances with AI

It’s no secret that AI in marketing automation has, and will continue to, revolutionize the way marketing is done. It has a bright, if slightly terrifying, future and can help CMOs to unlock new efficiencies, maximize the impact of their budgets and increase their ROI. And as this technology becomes more advanced, its impact will only increase.

But we already know that…and so does everyone else.

So, in order for businesses to make themselves stand out from the crowd , they must look to fully adopt the power of AI. Creating a customized and unique AI solution could be the way to set yourself apart from your competitors. A bespoke AI tool can provide brands and businesses with features unique to them and their business needs. As a result, companies will benefit from more useful data and better results to make more data-driven decisions for their business. Ultimately, this will help brands to maintain a competitive edge over their competitors, deliver ROI and most importantly optimize their budgets.

Business

Exploring the Transformative Potential and Ethical Challenges of AI in Wealth Management

Published

2 days ago

September 26, 2023

admin

Nuno Godinho, Group CEO of Industrial Thought Group

In recent years, the advent of AI has sparked both excitement and scrutiny within the Wealth Management industry. The technology’s capabilities, including but certainly not limited to generative AI algorithms like ChatGPT, offer a new dimension to data analysis, market prediction, and portfolio management. However, while it presents a promising avenue for enhancing decision-making and elevating client interaction, AI also carries inherent challenges that demand careful consideration.

Benefits of AI in Wealth Management:

In a world where CX is key, AI enables wealth managers to provide personalised advice, improved portfolio performance, real-time insights, and convenient access to information and support. Previously it has been impossible for advisors to deliver hyper-personalisation at scale; now, AI-driven customisation lets them tailor investment strategies and recommendations to their clients’ unique financial goals, risk tolerance, and investment horizon.

AI algorithms can also analyse vast amounts of data to identify trends and opportunities, resulting in potentially higher returns on investments. And, more widespread use of automation will gradually reduce the cost of wealth management services, meaning higher-quality investment advice at a lower price. This is critical as firms fight to stay relevant for modern investors disillusioned by traditional advisory firms and private banks.

Relationship-wise, there are many other advantages. AI-driven data analytics make it easier to gain a deeper understanding of an investor’s needs, preferences, and behaviours, all of which help to build long-term relationships. Through predictive analytics, firms can differentiate their service and proactively identify new investment opportunities, such as emerging market trends or underperforming assets. At the same time, chatbots and virtual assistants facilitate constant communication to answer queries and increase engagement. By strategically integrating AI technology into their operations, firms have the power to optimise top and bottom lines, strengthen client connections and position themselves for long-term growth.

Navigating the Ethical and Practical Challenges:

While AI holds remarkable potential, major obstacles must be overcome. With AI’s reliance on large amounts of data, ensuring client data confidentiality, managing consent, and complying with global data protection regulations like GDPR are significant challenges. Another issue is algorithmic bias – as AI learns from data, it may inadvertently perpetuate inequalities or biases present in the training datasets used. Vigilance is necessary to ensure that AI systems don’t amplify these issues. A key concern is the absence of standard governance, leading to a lack of accountability and transparency. Black-box algorithms can make decisions without providing clear explanations for their reasoning, making it difficult for clients and regulators to understand and trust AI-driven outcomes. Overall, the responsibility for AI-generated recommendations remains complex, requiring collaborative efforts to establish robust regulatory frameworks.

Striving for Data Integrity and Reliability:

The efficacy of AI-driven solutions hinges on the quality of training dataset they are supplied with and rely upon. Therefore, ensuring accurate, unbiased, and comprehensive datasets is paramount to generating trustworthy insights. The absence of standardised data sharing can lead to skewed results, ultimately impacting the quality of AI-generated advice. Transparency in data usage, validation, and generation reasoning will be pivotal to cultivating client trust and minimising systemic risks, which ties back to the absence of standard governance, as the output from AI-generated advice will only be as good as the data sets provided. We need to understand the “lineage” of all data used and generated by the algorithms. Until the industry can come to some accord on how we plan to use all of our respective data, it will be prone to various biases and fragmented advice, which will lead to liability and reliability issues down the line. It’s worthwhile wondering whether we can see the industry opening up in an age of data equals value.

The Role of Collaborative Partnerships:

Amidst these challenges, collaborative partnerships emerge as a potent avenue. Established wealth management firms can harness the expertise of FinTech AI companies to augment their capabilities while mitigating the risks associated with AI adoption. A symbiotic relationship, where innovative AI solutions are developed by trusted partners, helps safeguard against potential pitfalls and aligns with the pursuit of ethical, data-driven decision-making.

Looking Ahead: Striking a Balance for Sustainable Progress:

As we journey into the AI-powered future of wealth management, it’s evident that a balanced approach is essential. The integration of AI has the potential to expedite the transition to wealth management 4.0, revolutionising personalised client experiences and advisory services. However, this progress must be underpinned by clear ethical guidelines, data integrity, and collaborative partnerships. Striking this equilibrium promises not only a more informed, efficient, and personalised industry but also one that upholds the principles of transparency, accountability, and client trust.

In conclusion, AI’s impact on the wealth and asset management landscape is profound, offering unparalleled insights and opportunities. While navigating challenges will be crucial, a collective effort to harness AI’s power while ensuring its responsible application will pave the way for a resilient, future-forward industry.