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TAKING A MORE HUMAN APPROACH TO AI

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Author: Chris Pope, VP Innovation, ServiceNow

 

Artificial Intelligence (AI) is all about machines, obviously. Except it’s not. In truth, discussions surrounding AI may often centre around how competent, intuitive and contextually aware the machine brains we are building have become.

 

But really, AI is all about us―the humans—and how it can make our lives better.

 

Chris Pope

There was a time, perhaps even inside the current decade, when AI tools and functions were still associated with the fanciful ‘talking computers’ that featured in many 1980s movies. It wasn’t that long ago that we considered AI as something of a ‘toy’ and its application in mission-critical enterprise applications was still somewhat laughable. Of course, now we take talking computers completely seriously. So much so that we’re equally focused on the proficiency of computer speech recognition.

 

Application of AI

But as far as we have come, we still need to look at the real world use cases of AI and ask how it can help us make our lives better. If we’re not applying AI to our human work experiences to examine and analyse where it can make those experiences greater, then what are we doing here in the first place?

 

The truth is, many enterprises large and small have been struggling with finding the appropriate use cases for new and emerging AI technologies. Companies need to find the workflows inside their business models that can benefit from AI. Only then can they start to architect towards turning those operational throughputs into truly digital workflows.

 

So how do we define AI-enabled digital workflow Nirvana and how do we get there?

 

Typically, the process starts with a technology audit and a process of assessment, quantification and qualification running throughout the IT stack in question. Individual business units will need to step back and identify their work problems and challenges as they look for the elements of their workflows that can be digitised.

 

Everybody across every line of business function will be involved―we need to crowdsource and collaborate to identify strategic areas of business operations that still exist as predominantly manual, accurately measurable and fundamentally repetitive.

 

These are the parts of business that represent liquid gold, i.e. once we tap the seam, we can channel these functions into AI-driven services that subsequently run as digital workflows. Individuals are liberated from drudgery, productivity is increased and employees have a greater experience—a new virtuous circle is established.

 

Practical examples

Think about a typical office. When people leave the company, we need to manage who has a key fob for access to the car park. This is a perfect example of the type of job that has typically been performed manually through the use of a spreadsheet. This is time consuming, error-prone and obviously creates security issues.

 

But it’s also (I hope obviously) a perfect example of the type of task we can evolve to become a digital workflow driven by intelligence stemming from AI. Our analytics engine should know that an employee is leaving the firm and so reports, alerts, emails and perhaps even mobile device management, to cancel the key fob, can all happen automatically.

 

If we can make all those things smarter and more intuitive, then we can build better experiences faster.

 

Uber hasn’t actually done anything fundamental to change the way taxis work or drive. It has changed the digital workflow that governs the ability to book and pay for the service. The list of services-centric examples in this space is growing every day.

 

Automating a bad process doesn’t make it good

In the technology industry, we are often bad when it comes to decommissioning things. Think about how many business processes probably exist today that firms need to eradicate and get rid of.

 

There’s no point in applying AI to these aspects of the business. As we know, automating a bad process doesn’t make it a good process; it just makes it an automated bad process! So, this re-engineering is actually an opportunity to clean out your cupboard and stop doing the things that you no longer need to do.

 

An example that came out of a recent hackathon, we conducted, is a tool to help with filing of patents. One of our hackathon teams used AI and ML to trawl the web for all registered patents using word recognition. They wanted to identify connected words to see if a new invention already existed in some form already. This would have been costly manual work, that may have been handed over to a specialist (in this case, a patent lawyer), but now we can digitise these aspects of the business.

 

The human factor baseline

We as humans now need to engineer the existence of AI into our own mindsets and consider how it can help us work differently. This includes knowing what things we don’t need to worry about anymore. For example, we don’t take a map out with us these days, because we use a smartphone—so what else can we stop doing?

 

As we move down the more humanised road to AI, we will find that AI itself gets smarter as it learns our behavioural patterns, penchants and preferences. We must still be able to apply an element of human judgement where and when we want to, but that’s already part of the current development process as we learn to apply AI in balance when and where it makes sense.

 

The future of AI is smarter, and it is also more human. The end result is more digital at the core, but more human on the surface. If that still sounds like a paradox, then it shouldn’t. We’re at a crucial point of fusion between people and machines and it’s going to be a great experience.

 

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Mitigating the insurance risks of climate change through geospatial data visualisation

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Richard Toomey, Senior Manager, Commercial Insurance at LexisNexis Risk Solutions UK and Ireland

 

In the lead up to the 26th United Nations Climate Change Conference of the Parties (COP26)[i] November 2021, A United in Science report[ii]  provided a stark warning of the impact and acceleration of climate change. The UK Environment Agency also warned of more extreme weather leading to increased flooding and drought[iii]. While some progress was made at the conference, understanding the changing risks created by extreme weather to price property insurance more effectively, and more importantly, to help mitigate the physical risks posed by climate change, has become imperative.

Mapped geospatial data intelligence including live data on flood warnings and river flows, viewed alongside data held by insurance providers on the properties in their portfolio, can be a key ally in helping to protect customers and reduce claims losses created by extreme weather events.

With the air temperature rising and heavy rain becoming more and more frequent due to climate change insurance providers are looking to identify properties that are more at risk than others. For example, properties with basements carry more of a substantial risk of surface water claims than others and especially in London where space is tight and water runoff is low. In the autumn of 2021, the industry saw a number of high value claims due to basement flooding. There are some really large high net worth (HNW) households with big basements which carry a significant insurance risk.  The problem is that in many cases insurance providers don’t know if they have a property ‘on cover’ that actually has a basement.

The huge and growing volume of data now available to the insurance market to assess property risk to the level the industry needs, could easily overwhelm and prove a barrier to the swift decisions needed in weather-related surge events. However, the evolution of desktop based geospatial data visualisation tools such as LexisNexis® Map View means insurance providers can make quick, informed decisions based on a picture or map of risk, looking at a specific geographical region, a postcode, an address or a single property outline.

They can look at environmental risks including flood, fire and subsidence and live flood data updated every 15 minutes direct from the Environment Agency, as well as highly predictive flood risk data from respected flood modelling organisations. Insurance providers can also bring in data on the characteristics of a property to understand more about its construction, including the type of roof it has, how many floors there are, the square footage, as well as further data on the location and the individuals behind a business to gain a more holistic understanding of risk for pricing.

Mapping of historical flood data brings a further dimension to the understanding of risk, revealing the maximum extent of all individually recorded flood outlines from rivers, the sea and groundwater springs in England and Wales. This takes into account the presence of defences, structures, and other infrastructure where they existed at the time of flooding and includes floods where overtopping, such as at seawalls, river breaches or blockages may have occurred.

But the real step-change for the market has been recent ability to view live flood and other environmental data in tandem with customer and policy data held within an insurance providers’ own databases.

Crucially, this means insurance providers can pinpoint down to individual properties, the policyholders most at risk as weather events unfold, should a river burst its banks, or a flood barrier fail and those properties that may actually be vacant at the time of the event.

Through data visualisation tools, insurance providers can gauge where flood water may go so that policyholders can be warned to take measures to protect themselves, their possessions and to move any vehicles to higher ground. They can even see where roads may have been closed due to fallen trees. All this intelligence helps with planning on the ground resources, working with local authorities and claims adjusters. Then, in the immediate aftermath, rather than wait for a deluge of claims, insurance providers are in a position to reach out to customers known to be in areas affected to support them through the claims process.

The inherent flexibility of today’s geospatial data visualisation tools for the insurance market means risk can be assessed as needed or as constant monitor for a whole commercial property portfolio. Fundamentally these tools are designed to streamline the assessment of property risk.

In the future, commercial and residential property claims data gathered from the whole of the market may allow insurance providers to look at a whole portfolio alongside past claims, but for now they can bring in their own claims data to build a more granular picture of risk, to price more accurately and understand how they could help mitigate future claims and potential losses caused by weather events.

A picture can say a thousand words and data visualisation tools can certainly make highly complex risk data easy to understand and act upon. Being able to instantly visualise an environmental risk to policyholders – day or night – using highly granular data on past and present flood events puts insurance providers in a more powerful position to reduce the misery and costs caused by extreme weather.

[i] https://ukcop26. org/wp-content/uploads/2021/07/COP26-Explained. pdf

[ii] https://public. wmo. int/en/media/press-release/climate-change-and-impacts-accelerate

[iii] https://www. gov. uk/government/news/adapt-or-die-says-environment-agency – The Environment Agency’s third adaptation report October 2021

 

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From compliance to the metaverse: Investment trends to look out for during the year ahead

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By Rami Cassis, Founder and CEO of Parabellum Investments

 

In the investment world, the old saying, knowledge is power, has never been more pertinent. As any investor will testify, it is essential to retain an in-depth, and up to date, understanding of news, predictions and trends that specifically relates to his or her specific area of interest.

This is particularly true for investors in the financial sector.

We all know just how quickly the sector can change beyond recognition. The demands of consumers are forever changing, new technology is always waiting in the wings to re-write the financial status quo and the next big digital company is constantly looking to increase its market share. There is always a new trend to look out for.

As we move into a brand-new year and prepare to face the opportunities – and challenges – that doubtless lie ahead, these are some of the trends that are likely to develop during the next 12 months.

 

Personal banking conversations

In its Tech Trends 2021: A financial services perspective Deloitte states that today’s pioneering companies are using advanced digital technologies, virtualized data, and cobots to transform supply chain cost centres into customer-focused, value-driving networks, based around a personal experience.

The concept of personal banking provides a perfect example of how the financial services sector has evolved to deliver digital personal banking.

Before the digital banking revolution, personal banking involved a visit to a high street branch to sit down with a personal banker in the flesh. This personal banker would be the customer-facing, end point of a complex supply-chain, involving training centres, degree courses, carbon-emitting journeys into work – the list goes on.

Compare this to the current version of personal banking. Digital financial services firms such as Monzo have revolutionised banking thanks to sophisticated analytics and a personalised interface. The big banks are now catching up, offering their own versions of ‘modern’ banking insights for the everyday user, and furnishing them with the latest online, smartphone-powered gadgets to enable them to manage their money 24/7, wherever they might be in the world.

However, even this is now becoming somewhat stale, with many financial services providers still seeing personalization simply in terms of personalized messages. Instead, the next chapter will involve smart banks understanding that good personalization requires personalized conversations, not just messages.

Enterprise software is one of the specific investment interests of Parabellum Investments. One of our portfolio companies is ieDigital, a specialist UK financial technology provider. The team from ieDigital and Parabellum Investments analyses the latest developments in business technology regularly.

We understand the importance of pushing digital boundaries. Indeed, one eye should constantly be scanning the horizon to identify the digital tools that the customers of tomorrow will expect. The interpretation of digital transformation is specific to each organisation and translating technology into practical business outcomes requires the focused specialism the combined IE Digital & Parabellum Investments team is qualified to deliver.

We understand – and see daily – the pressure that banks are coming under to deliver an ever more personal service, and see the ability to deliver these personal conversations is one of the trends to watch during the next 12 months.

 

The metaverse

The word ‘metaverse’, is defined in the Oxford English Dictionary as a “virtual-reality space in which users can interact with a computer-generated environment and other users”.

When Facebook changed its name to Meta in 2021 it may have come as a surprise to many of the platform’s users, but it was a major moment in the company’s history. It signalled Mark Zuckerberg’s ambitions for his business; to be the leader in the development of the metaverse.

Indeed, the future of the metaverse is looking sophisticated and bright. With giants like Facebook and Microsoft introducing metaverse elements into the fabric of their business models, it’s a concept that cannot be ignored, and one which is likely to expand rapidly throughout the next 12 months.

Returning to the financial services sector as an example, in a blog post titled Metaverse, the end of banking digital transformation?, CoinYuppie speculates that the metaverse will change banking in a number of ways including:

  • Identify verification. In the metaverse, identity verification will be performed via VR glasses and Metaverse sensor devices which contain a security chip.
  • Real-time creation of financial products. In the meta universe, virtual product managers use gestures to drag and drop the entire process of digital product manufacturing.
  • Games and attractions become a source of bank traffic. You can open branches on Mount Everest, in the Tarim Basin, on the Kunlun Mountains, or in Jiuzhaigou. The bank will combine these magnificent landmarks to fully personalize its branches and display its products.

This is just the financial services sector. Just imagine the opportunities for other industries – and the tools that will be needed to deliver them.

People are likely to need virtual-reality headsets, for example, together with related components such as sensors, as virtual-reality technology becomes intrinsically linked with the metaverse world.

 

Compliance

Another key trend to look out for as we move into 2022 and beyond is how companies deal with their compliance issues.

In the wake of the global Covid pandemic, we are seeing a much-increased hybrid working model, with a large proportion of the workforce now based at home. This creates a logistical headache for compliance teams, who must now ensure that sensitive data and company secrets remain just that, despite a workforce now using multiple digital platforms, messaging systems, mobile phones and landlines.

Cloud-based archive systems that can capture multi modal communications are likely to become essential for companies to remain compliant.

 

Alternative currencies

Cryptocurrencies are likely to retain their position as one of the most talked about developments in the world of alternative currencies.

As an example, Bitcoin has risen nearly 70% since the start of 2021, driving the entire crypto market to a combined $2 trillion in value. However, heightened regulatory scrutiny and intense price fluctuations have somewhat dampened bitcoin’s prospects in recent months.

Despite this, we are likely to see banks increasingly looking at offering mainstream crypto services. We have already seen the start of this, with the first major crypto company going public with the debut of Coinbase in April, increased participation from Wall Street banks like Goldman Sachs, and the approval of the first U.S. exchange-traded fund linked to bitcoin.

 

Conclusion

We all know how quickly the financial sector changes. If you happen to be reading this just a few months after it was written, several of my points might now be in the mainstream – or they might be completely obsolete.

The fact is that unless an investor possesses superhuman powers, it is impossible to identify, with 100 per cent accuracy, what the next big investment trend is. All we can do is use our experience, insights, and up-to-date sector knowledge to predict what the next big trends are likely to be.

 

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