Straight Talk Special Issue: Financial Services - 16

"Hey, I need a small number of experts who can deal with
the exceptions, and then I can do all the rest with
machine learning and automation, and this will lead to a
better, more eﬀective outcome." Until you unlock their
minds and say, "Hey, maybe there's a better, simpler, and
diﬀerent way of doing this," you won't get anywhere.

Do you have any thoughts about how
legacy firms can become more agile?

Consumers deﬁnitely have a desire for a
much more consumer-focused
experience with their ﬁnancial
institutions - less people-to-people and
more people-to-application. Why should
dealing with my bank be harder than
dealing with Amazon?

You also need to re-imagine the processes that you have. If
you just add technology for technology's sake, then you
won't be terribly eﬀective. Maybe you'll develop an
Alexa-based app to help somebody do some voice
commands, and then turn around and realize that for
privacy reasons, people don't want to bank that way. You're
better oﬀ looking at a whole process and asking, "How can I
make this better and more eﬀective using the technology
that's available to us?" For example, the mortgage process
is complex, and if you understand the mortgage business
then you can come in and ask, "OK, how can I use artiﬁcial
intelligence for underwriting, how can I use blockchains for
the title process?"

Banks always used to have big in-house
shops, but between Fintechs, SaaS, and
offshore developers, they have had to
become more outwardly focused. Are they
getting used to working with external
partners?
They are getting much more comfortable with that now.
Take the attitude toward the cloud. Two or three years
ago, most ﬁnancial institutions would tell you that they,
because of risk or regulations, could not move to the
cloud. That's changed pretty radically in the last 12 to 24
months. Organizations like FINRA, which is responsible for
regulations and compliance, have themselves moved to
Amazon Web Services. FINRA now has 60 million client
records in the cloud. Now most banks are saying, "Hey,
wait, if we can get beneﬁt out of running some of this in
the cloud, why not do that?"

It sounds like the banks are getting more
daring than they used to be. Are there any
other new technologies where they're
starting to think, "Hey, we can do this?"
Yes, blockchain is a good example. There's now no
shortage of consortia that have developed around
blockchain and many, many ﬁnancial institutions are
participating in those consortia, and working on blockchain
use cases in their own labs. The same with "backbone"
institutions such as DTCC: If you look at their public
proclamations about blockchain from, say, three or four
years ago and compare them to today, it's night and day.

16

It doesn't all need to be agile. Some things have to be
containerized and updated every single day. But there's other
work where there's no need for this. Not everything needs to
move at one speed. But it can't just be bimodal, either. It's
not like there's some stuﬀ that's fast and some stuﬀ that's
slow, and that's that. You have to be able to adapt.

Not everything needs to move at one
speed. But it can't just be bimodal
either. It's not like there's some stuﬀ
that's fast and some stuﬀ that's
slow, and that's that.

We talked about the faceoff between
robots and high-end brokers. Do you think
people will still have a role going forward?
I think people may be overly concerned about that
"driverless bank" paradigm we talked about earlier. They
have a notion of massive layoﬀs ahead, but most
institutions aren't laying people oﬀ wholesale simply
because these new technologies are introduced. We've
worked with more than 100 companies on automation and
artiﬁcial intelligence, many of them ﬁnancial services
companies. What we ﬁnd is they often wind up shifting the
kinds of work people are doing to higher value tasks that
make the institution more productive. Financial institutions
are always going to need people to make complex
decisions. It's not as simple as turning machine learning
loose on a company. Even in designing the automation, you
will still need people to guide the process. How are we
going to do this? Where are we going to take this?
Straight Talk Special Issue: Financial Services

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