Business

NO MOJO? THE UNLIKELY SOLUTION TO THE FINANCIAL INDUSTRY’S IMPENDING TALENT CRISIS

Published

2 years ago

September 20, 2021

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Matthew O’Neill, Industry Managing Director, VMware EMEA

The financial services industry has lost its mojo. There was a time – in the not-too-distant past – where it was the place to work. But the industry that we know today is no longer the place young talent. Other sectors simply have surpassed the sector on the ‘cool’ factor.

There is a solution, and it comes from an unlikely source. The pandemic. It has forced companies, including those in the financial services industry, to change working practices.

But it’s going to require a more open-minded approach, which won’t be easy for an industry steeped in very traditional views and big on security and compliance. That said, opportunities like this don’t come around very often so I’ve outlined three reasons why the future of talent in financial organisations depends on them grasping it with both hands.

Timing is everything

Wind back the clock to before 2020 and it would’ve been inconceivable for most financial firms to embrace regular remote working outside of the occasional snow day or plumbing emergency. Presenteeism largely equaled work. It has taken something as dramatic as a global pandemic to force the financial services industry into changing this perception.

Investment in corporate real estate has been a key reason for this. Companies wanted to optimise the number of people consuming the buildings that they pay huge, fixed costs to build, rent, run and manage. But culture – across sectors – is arguable still the biggest problem. Being seen in the office was considered far more valuable than actual content output.

While the flaws in both reasonings for avoiding remote working were well known, it took the pandemic to show just how flawed they were. The challenge and opportunity now are for executives to look at how they can rethink the office environment to make it one that supports hybrid working models, as well as rethink culture through different ways of measuring success.

This is crucial if you want to attract the next generation of talent. For example, HSBC recently decided to scrap the entire executive floor of its London HQ to remove the divide between C-suite office managers and everyone else. They recognise the importance placed on flexibility and an inclusive culture by the younger generations and are looking at how they can introduce changes to make themselves more attractive to that talent.

Big Brother, no thank you.

Technology, of course, plays a key role here.

The adoption of video and collaboration platforms have now gone from a nice-to-have for executives to a mandatory need-to-have for all. Traders at Barclays, for example, have adopted messaging platform Symphony, which has bank-level compliance and security to keep in touch. Installed on company phones and employee’s computers it has become, a “pure and compliant” social network for traders. This is just one example of why distributed working is achievable. Made possible by the ability to manage security, all the way to today’s distributed edge, centrally.

So, they’ve done the work that enables people to do their jobs. Now they need to take it a step further and approach technology from the angle of what makes people the most productive. That doesn’t mean – as is a possible short-sighted remedy to not having line of sight of your employees – putting in place spyware or screen monitoring capabilities to track how much time employees are spending at their computer or counting the number of keystrokes.

That starts with a mindset shift – to look at the employee experience as a productivity measurement. As PWC outlines, that means looking comprehensively at the nature of work, the activities that different employees perform, and their output. Focus on what have they created or driven rather than how many hours they spent on the phone or in meetings.

To support that further, organisations should also consider how individuals can improve their productivity through new ways of working and the development of digital skills. Financial Services Skills Commission (FSSC) chief executive Claire Tunley recently stated that “investment in learning and developing is not keeping pace with the sector’s evolving needs”. By showing new talent that they offer better development opportunities or the ability to work in a way that suits them, they are going to appear much more on the pulse. And they can also better develop existing talent rather than always having to recruit from outside.

Which brings me nicely to my third point.

Choice not conformity

This is the industry’s opportunity to truly embrace difference. To start giving employees the right set of tools to do the job, in a way that they are exceptional at. To get the most from their people, play to their differences and strengths (or as René Carayol calls them, their Spikes) rather than trying to transform them to fit into a bell curve. A basic example is that some employees will want the latest version of Windows and some will want Mac OS. Organisations can make it the individual’s choice and give them a level of flexibility that makes them feel valued.

Mel Newton, Head of Financial Services People Consulting at KPMG UK put this perfectly, “flexibility is more than just allowing people to work from home on the occasional Friday. What the future workforce wants is personal choice”.

To compete for the best talent, personal choice and flexibility is what financial services firms will have to deliver. These need to be embraced, even in the most established of firms.

The draconian days are over

Rethinking working practices in financial services is long overdue. While not everyone is on board, there are far more who are embracing the opportunity for change. As Claire Tunley said, “the skills issue is bigger than any one firm” and it will get worse if organisations don’t start thinking about their people differently. They are technologically ready to do so but it’s going to need a different culture and the courage to leave tradition behind.

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Business

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

Published

24 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.