The future of banking: unlock the data-driven bank


Will human roles in banking be replaced by mechanisms in the near future?

Cognitive technologies, robotics and connectivity are shaping the future of work

Clients trust banks with their data. In order to use the full potential of this data and ‘wow’ clients, it is crucial to implement cognitive tools, focus on retraining people, and rethink the role of the human workforce.

Thinking ahead

Increasing customer and shareholder expectations, and the development of new technologies (e.g. AI, AR/VR, robotics), are forcing banks to reconsider their role in the future financial environment. They must decide what capability set they need to fulfil their purpose and mission in a changing world. This requires them to continue to strengthen core digital advice technologies, expand their investments in deeper, richer data sets and self-learning algorithms to drive critical customer-facing activities, and reconsider the value of the human workforce.

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Examples of AI and robotics solutions in banking

To start with the first two: many banks are already adapting technology embedded solutions. For instance, a Dutch retail bank, Deloitte and a software vendor recently developed a virtual agent called Amelia, who emulates human intelligence. Amelia is able to understand human language, she learns through observation and determines what actions to take in order to fulfil a request or solve a problem. We selected the right use cases, translated the process design into user stories to build into Amelia, configured and trained ‘her’, and took care of end-to-end project management. Also, for a major UK bank, we developed an Intelligent Automation Credit Stewardship with specific focus on portfolio management and covenant monitoring, based on AI and Robotic Process Automation. We were able to improve six key stages of the portfolio management process, from extraction of customer information to checking against agreed covenants and providing breach alerts. Results: a 93-95% accuracy rate and significant FTE savings (in the UK and India), as well as reduced process time (from 10 days to 3 minutes).

The future of work

Naturally, examples such as these, where cognitive technologies, robotics, automation and accelerating connectivity perform formerly human tasks, are all shaping the future of work. These elements will lead to a seismic shift in the way humans will add value to key processes in future. Jobs will be reinvented as personal expectations of work evolve and essential human skills are augmented by technology. In fact, we seem to be moving from the current situation in which the human factor is central to the organization, towards a state in which the central role of humans will probably be replaced by a mechanism capable of serving a central role in dynamic and continuously changing organizations (see Fig 1 below). Decisions about how work should be configured must be based on three key questions:

  1. What work can be automated in the next 5-10 years?
  2. Who can do the work? Technological advancements enable new talent models that extend beyond full and part time employees to contractors, freelancers, gig workers and crowds.
  3. Where can the work be done? This involves rethinking how work is distributed, virtual, and conducted in connected workplaces.

“Leading companies increasingly recognize that these technologies are most effective when the complement humans, not replace them” (HC trend report 2018, p. 74)

Impact on the human workforce

So how should organizations and employees prepare for these changes? Organizations need to focus heavily on retraining employees to use e.g. cognitive tools, and rethink the role of people as more and more work becomes automated. At the same time, people need to reinvent themselves more frequently. Their ability to adapt to change will be their most valuable asset, whether they are fully employed or belong to the ‘gig workforce’ (subcontractors and freelancers). According to the Oxford Research Institute, up to 53% of today’s jobs will be obsolete in 10 years. These jobs will be replaced by other jobs at the ‘human’ end of the spectrum, requiring skills such as communication, empathy, intuition, and social perceptiveness, which will help to contextualize, interpret and question data. Human/machine collaboration, not competition, will be crucial in order to truly ‘wow’ the client.

Deloitte is on the forefront of raising understanding on the impact of technologies. Our Future of Work thought leadership series has been awarded the Management Consultancies Association Awards 2017.

The Future of Banking

In the upcoming months we will share a range of articles with you on the future of banking, based on the ‘seven wicked problems’ we have identified. This article is one of these ‘problems’. Our research skills and day-to-day experience in working with banks have allowed us to dive into these challenges more deeply. By sharing our insights, we strive to help you with the choices you face in your day-to-day work and with aligning your leadership, culture and organizational structure to a fully digital mindset, optimizing the use of proprietary and external data. Sign up for the email alerts to make sure you won't miss any of the articles about the latest insights and solutions on the future of banking.

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