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INTEGRATING INTELLIGENT AUTOMATION AT SCALE—A 4-POINT SUCCESS CHECKLIST

The value intelligent automation brings to financial services is well-publicised. Fast, convenient account openings for customers on-the-go

By Tyler Suss, Product Marketing Director at Kofax

 

The value intelligent automation brings to financial services is well-publicised. Fast, convenient account openings for customers on-the-go. Smoother loan origination, closing and servicing processes. Paperless audit trails to reduce the risk of non-compliance. The list goes on.

Many have experienced some of these benefits first-hand. But frequently, the value is limited to pockets of success that are difficult, if not impossible, to replicate and extend throughout all business processes and operations enterprise-wide. What’s missing is often a strategy for how to automate beyond a single process or department and integrate existing pockets of automation that are delivering value.

The good news is that a carefully reasoned approach can help ensure they’re on the right path toward a fully integrated, optimised intelligent automation workflow—and avoid coming up against roadblocks or dead-ends.

 

The value intelligent automation brings to financial services is well-publicised. Fast, convenient account openings for customers on-the-go

Tyler Suss

What to Consider—and Who

When it comes to integrating intelligent automation end-to-end, forcing it all at once can be a recipe for delays—or even disaster. Before taking any concrete action, it’s wise to think through a few key considerations to pave the way for a smooth intelligent automation integration.

First, must clearly define the strategy. Why is intelligent automation important across the business? Which processes are the priority? A recent Forbes Insight survey found that 90 percent of senior executives believe their leadership understands that process automation is critical to future success. It’s helpful to identify executives who can speak about the benefits for different departments individually, as well as once the strategy is executed across the organisation.

Second, the siloes are frequently the elephant in the room. True, individual departments or processes may be seeing benefit now, but what about when the business grows?  An end-to-end view of the business, from the front office to the back office, is essential so that it can accurately pinpoint best practices and drive better cross-departmental integration and benefit.

A final consideration is acknowledging that while technology is essential, employees should always be part of the equation. With the right mix of human talent and a digital workforce, productivity increases, as does job satisfaction, since employees can re-focus on more fulfilling, strategic work.

So how can financial services feel confident they’re touching all the bases for a winning intelligent automation integration?

 

Here’s a useful 4-point checklist:

  1. Ask for feedback.

Cross-functional participation is essential. That means looping in executives, business and process leaders from areas such as human resources, finance, sales, operations management, etc. These are the people who face the challenges of manual processes in their roles every day. Outside stakeholders should be included where practical—the decisions made for process transformation will have a very real impact on their business as well.

  1. Present the case.

There’s often only one chance to make a convincing argument. Therefore, consider the pitch wisely. Describe what a positive outcome looks like: More satisfied and engaged customers? Reduced processing times and costs and an improved bottom line? Less risk because more accurate data and audit trails translate to better compliance?

It’s important to show the quantitative benefits that could be achieved—whether that’s a 20 percent expected reduction in costs or a 30 percent improvement in productivity. But perhaps just as important are the less tangible benefits that integrated intelligent automation brings—such as better experiences throughout the customer journey, improved relationships with vendors and partners, and more engaged employees with better morale and work/life balance.

  1. Research vendors.

Next, it’s time to do the homework. Make a list of potential vendors and sort by their strengths (legacy of proven success providing solutions for financial services, demonstrated commitment to an integrated automation portfolio, etc.) and weaknesses (Are they a start-up? Do they primarily provide point solutions that aren’t pre-integrated?).

  1. Start small.

Once the vendor is chosen, it’s best to begin with a basic, proof-of-concept use case. Chances are that a smaller focus will bring swifter results. Then, once positive results are clear, expand and scale the solution. For example, let’s say mobile account opening is the chosen test run for automation. Be thinking about what a successful pilot looks like so once the milestone is reached, the team is poised to optimise and roll out the solution end-to-end across other processes.

Intelligent automation at scale enables bringing together people, processes and technology without the friction and cost of juggling a collection of disconnected point solutions. The result is lower total cost of ownership and reduced manual work and errors. The workforce is more productive, and customers are more engaged. Also, it can customise digital transformation, adopting capabilities and scaling at their own pace to work like tomorrow.

 

Business

PUTTING TECHNOLOGY AND EMPATHY AT THE HEART OF SMB LOAN SERVICING

Luis Huerta, Vice President and Intelligent Automation Practice Head, Europe at Firstsource

By the end of March 2021, over one and a half million small and medium-sized businesses (SMB) had borrowed through the Bounce Back Loan Scheme (BBLS) – amounting to a staggering £46million. This means 29 accredited BBLS lenders have thousands of new customers to service, as well as a sizable level of debt to collect.

Even when lockdowns lift, the pandemic crisis has been predicted to result in lasting damage to the UK economy. With SMB borrowers finding themselves in highly unpredictable and stressful circumstances, lenders servicing BBLS face a unique challenge – keeping large numbers of anxious customers appeased through uncertain times. To ensure healthy customer relationships, financial providers will need to focus on adequately addressing borrowers’ needs. This is where technology can help. 

Creating room for empathy with AI technology
Because sensitive conversations tend to take longer, lenders are using technology solutions such as robotics and artificial intelligence (AI), as well as integrating digital channels, to support these interactions.

The latest conversational AI can now process and deliver human language more naturally, follow up on queries, and execute transactions than would otherwise need to be handled by an operator. By deploying AI, lenders can fully automate these routine transactional contacts. This frees up staff to focus on the more complex and sensitive interactions, where human touch is key.

Simplifying processes with automation

With more unique BBLS customers to service there will naturally be an increased pressure on resources. Yet recruiting and training additional staff to address this is not the most efficient or cost-effective solution. Here robotic process automation (RPA) can be used to automate repetitive time-consuming tasks.

By leveraging attended automation technologies, organisations can again lessen the burden on operators. For example, automation can be used to create clean, simplified, user-centric interfaces that pull in data from a plethora of disparate applications. These seamless, modern interfaces help agents process transactions and customer enquiries faster whilst bots deal with the complexities of logging-in and navigating various applications and screens in the backend. This approach improves customer services as well as helping to increase job satisfaction. Moreover with fewer screens to manage, onboarding and training time is also dramatically reduced.

Optimising customer communications with analytics

To deliver outstanding services, lenders need to reflect SMBs’ needs through tailored communications. Applying AI and advanced analytics to customer data can support these efforts. For instance, analysing customer attributes such as age, location and service interaction patterns enables organisations to identify and deploy personalised communication across preferred channels. Machine learning-powered forecasting algorithms can also be used to predict ebbs and flows in customer call and chat volumes numbers, helping lenders forecast resourcing needs appropriately.

Importantly, digital channels also offer a less intrusive contact approach to traditional voice calls. By using web-portals, mobile apps, emails and text, lenders can provide customers with the information they need, when they need it, using the channel they prefer. This approach reduces call volumes and lessens the burden on operatives.

Using digital to spot and reduce fraud
At the start of BBLS roll-out banks saw an onslaught of fraudulent activity through false applications and phishing, this is still the case for many financial lenders. Here AI can also play a pivotal role. AI technologies can be used to detect and prevent fraud by drawing correlation between dozens of data points such as physical location IP addresses, web and app behaviour, etc.

For example, one major UK bank saw business accounts becoming fraud targets following the BBLS rollout. To combat social engineering attempts, the bank brought in Firstsource. Following thorough data analysis, they introduced more ID checks, red flags awareness training and updated questioning to detect possible scams. This resulted in the bank being able to identify more potential victims of fraud faster – leading to a 62% reduction in fraud losses in just four months and a positive uplift in quality assurance performance.

A golden opportunity

With the UK emerging from lockdown, we can hope that the economic outlook is about to improve for the SMB community. However, when it comes to BBLS repayments, these customers will still need empathy and guidance from lenders as they navigate the return to ‘normality’. By using tech to remove pressure from customer services, free up agents and drive strategic engagement, lenders will advance customer satisfaction and increase potential growth.

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THE SPAC BOOM: WHY COMPANIES AND INVESTORS ARE INCREASINGLY LOOKING TOWARDS SPAC IPOs

Maxim Manturov, Head of Investment Research at Freedom Finance Europe

Special purpose acquisition companies (SPACs) have long been part of the investment landscape, but this market has boomed in recent years. As well-known underwriters and investors show increased interest in the initial publication offerings (IPOs) of blank-check companies, SPACs have been pushed to the forefront of the agenda and there is even discussion around whether these will outpace the traditional IPO. Essentially, SPACs have become a very viable alternative for many private companies.

The SPAC boom is best exemplified by recent research from Refinitiv, which found that

SPACs have raised $79.4bn globally since the start of the year, eclipsing the $79.3bn that flooded into investment vehicles in 2020.[1] In fact, some studies report that SPACs accounted for a record 30% of all industry IPO earnings in 2020 and is already accounting for 54% in 2021, up from 1% in 2014.[2] The SPAC frenzy that commenced in 2020 therefore shows no signs of slowing, with 2021 set to be a record year for SPAC listings.

In light of this, with a long list of SPACs having filed for an IPO in 2021, it is imperative for companies and investors with growing appetites for participation to take a closer look before coming to a decision. So, let’s dive deeper into the rising popularity of SPAC transactions, the traditional IPO vs. the SPAC IPO and the future outlook for the thriving market.

The rising popularity of SPAC transactions

SPACs are non-commercial companies created solely to raise capital through an IPO in order to acquire an existing private company, thus bringing that company to the market. While SPACs have been around for quite some time –entering the investment landscape back in the 1990s– it is only recently they have exploded in popularity, as better-known underwriters and investors started taking part in them. This trend will likely grow as major private equity firms and venture funds continue to form more SPACs.

The reasons behind the rising popularity of SPAC transactions include low interest rates, simplified listing requirements, increased investor participation and the quantitative easing policies that are still adopted by most central banks. SPACs are also a great way to get exchange-listed during increased market volatility, as well as enable existing companies to gain access to liquidity that would not otherwise be available.

Ultimately, there are a range of factors that make SPACs a more sustainable option for raising funds, hence why target companies are increasingly looking towards SPAC IPOs to take them public. These factors, combined with the increasing number of high-profile sponsors entering the SPAC space, have enabled this market to soar. But will SPAC IPOs really outpace traditional IPOs this year?

The traditional IPO vs. the SPAC IPO

Traditional IPOs and SPAC IPOs are both subject to the same set of rules when taking a company public. When delving deeper into the benefits of these investment vehicles, however, there are notable differences. Compared to a traditional IPO, SPAC IPOs offer more certainty regarding the company value and fundraising, since the valuation is fixed through a privately concluded merger.

Alongside this, raising funds through SPAC transactions is one of the quickest ways for private companies who are in urgent need of capital. Getting ready for a regular IPO requires time, from a few months to a year, whereas creating a SPAC can be completed in just three short weeks. The benefits of this pace have been recognised none more so than amongst the ongoing pandemic, hence why investments in SPACs continue to surge.

One potential shortfall to point out, though, is the ability of SPAC IPOs to acquire a private company in the allotted timeframe. Once a blank-check company lists its security information on an exchange, it must complete a merger within three years or risks falling through, which creates added risk for buyers looking to invest.

In a nutshell, while SPAC IPOs can provide greater flexibility, efficiency and speed for target companies, they cannot wholly replace the reliability of traditional IPOs. Companies looking to go public must therefore weigh up the pros and cons of each option in line with their individual goals and capabilities.

The future of the SPAC market

That being said, many experts still believe that SPACs’ popularity will continue to grow in coming years as companies look to raise capital quickly and investors look to actively participate in this craze. This is demonstrated by initial stock market listings in 2021, which witnessed one of the best starts to the year since 2008, thereby highlighting that active participation in SPACs is undoubtedly growing. On top of this, with low interest rates and savings on commuting, food and coffee costs, COVID-19 has triggered an increased interest in investing amongst younger buyers.

But with so many SPAC options on the table, which ones are actually worth investing in?

  • Stable Road Acquisition Corp – Expected to merger with Momentus. Momentus is a pioneer in space transportation and infrastructure technology and is at the forefront of space commercialisation. With an experienced team of aerospace, propulsion, and robotics engineers, Momentus developed a cost-effective and energy-efficient space transportation system based on a water-plasma propulsion technology.
  • Social Capital Hedosophia Holdings Corp. V – Expected to merger with SoFi, a leading next gen financial service platform. SoFi’s mission is to help people achieve financial independence by taking correct money management decisions. This is a one-stop member-focused financial service hub that includes loan refinancing, mortgages, personal loans, credit cards, insurance, and investment and deposit accounts, with over 1.8 million users.
  • Property Solutions Acquisition Corp – Expected to merger with Faraday Future.  Faraday Future is a global smart mobile ecosystem company, the mission of which is to change the aspects of digital life when it comes to cars. The company already has a powerful portfolio of revolutionary value-added technologies, protected by nearly 900 patents worldwide.

The future for SPAC transactions is therefore likely to be bright as private companies increasingly look towards SPAC IPOs as a viable option to go public. With a growing number of players entering the SPAC space, the SPAC frenzy is only gathering pace.


[1] https://www.ft.com/content/321400c1-9c4d-40ac-b464-3a64c1c4ca80

[2] https://seekingalpha.com/news/3656255-piper-sandler-spacs-look-bubble-like-but-may-boost-goldman-sachs-and-evercore

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