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Talent, technology, and transformation

Global executives’ expectations for the future of financial services

How will the financial services industry evolve over the next five years? A new survey reveals top challenges and opportunities global finance executives anticipate—along with some marked regional differences.

Around the world, financial services industry executives face many similar challenges as they struggle to keep pace with myriad changes coming at them: in particular, new technologies, new market players, and shifting customer demand.

How rapidly is the pace of change accelerating for financial services industry (FSI) firms, and how are leaders planning to navigate their firms into the future? To answer these questions, it’s important to first consider that there are some regional and national differences in competitive market structure, regulatory environments, and the global scale of the industry that influence outcomes. Even though the larger G7 economies (Canada, France, Germany, Italy, Japan, the United States, and the United Kingdom) are still dominant, in terms of size (assets) and number of transactions, other countries, especially from the large emerging markets, have been catching up. In some cases, they have even surpassed their cohorts in advanced economies.

 

Insight regarding executives’ expectations for the future:

In short, survey analysis showed that:

  • Many G7 leaders doubt the influence of some emerging technologies, and are less likely to include them in their current plans
  • There is broad agreement about the influence of regulation, and relatively less concern about both current and emerging competition
  • G7 executives see changes in talent and operations coming much sooner than those in the rest of the world
  • Talent needs and gaps differ; G7 leaders are looking for industry and content knowledge, whereas others value flexibility and adaptability

 

A handful of insights can be drawn from the survey findings:

  • Firms outside the G7 see their futures as being much more dependent upon emerging technologies, while many in the world’s largest economies wait for proof of impact. But, in light of the rate of exponential change in technologies, it’s quite possible that this complacency/skepticism among the G7 FSI firm executives might put them at a disadvantage. By that point, they may be too late to capture a leadership position.
  • Firm leaders around the world are less likely to be preoccupied with potential fintech disruption moving forward. They do, however, recognize the need for innovation; acquiring talent with nontraditional profiles may be an increasing part of the solution.
  • Outside of the United States, where regulatory tightening is expected, firms will likely need to continue to push for improved risk management and compliance protocols.
  • G7 financial institutions may seek to increase the pace of business transformation given expectations for rapid change. But they may leave opportunities for improvement on the table if emerging technologies such as robotic and cognitive automation, blockchain, and the IoT are not in the playbook.

Leaders in both groups can benefit from considering these factors in their ongoing strategic planning and investment cycles, as well as in thinking about how they apply to their particular firms or markets.

Each of these is discussed in greater detail - click here
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