Technology is rapidly transforming every business, but the financial services industry as a whole has been feeling the impact in recent years. And artificial intelligence (AI) is currently a major cause of this shift.
There is a lot of robust conversation around what AI actually means, but by definition artificial intelligence is:
“A branch of computer science dealing with the simulation of intelligent behaviour in computers.
The capability of a machine to imitate intelligent human behaviour.”
World Economic Forum and Deloitte Global’s report, The new physics of financial services: How artificial intelligence is transforming the financial ecosystem, takes a deep dive into the role of AI within the financial services industry. It states that an unfamiliar environment will appear with the increased adoption of AI, that will have been created to:
- Deliver new kinds of value - Product and service innovation will lead to greater financial inclusion and a sleeker, more personalised customer experience.
- Reshape operating models - Financial institutions will become leaner, highly networked, and more specialised. They’ll also become more dependent on the capabilities of large technology players.
- Upend competitive dynamics - Data sharing will become critical to competitive success. The advantage will go to first movers and large-scale players in an increasingly bifurcated market.
- Take public policy into uncharted territory - AI will raise questions that challenge government and society, prompting the need for a new set of norms to protect humans, regulate machines, and remake the financial infrastructure.
While there are some downsides to AI (for example, the cost to implement can be prohibitive for small to medium sized players, security risks increase as more data is captured), it is clear that the benefits by far outweigh them.
Customer service and the creation of a sustainable competitive advantage with AI
Creating a sustainable competitive advantage – offering clients a better, more personalised service - is vital for your business during this time of change. Having a point of difference, such as incredible customer service or ease of use for your tools, can be the difference between maintaining and attracting new clients and losing them to your competition, especially as the world becomes more transactional and reliance on relationships decreases.
With the self-serve model of financial services gaining popularity, especially with younger generations, there is a well-defined need for best-in-class customer service, accessibility to product information and recommendations of the right product, for the right customer (personalisation). AI can assist in doing this and elevating service while reducing the need for humans to undertake repetitive, unskilled tasks, leaving your staff free to work on important tasks that improve your business.
Conversely, a risk to the future success of firms comes from lack of interest, funding and executive support for AI. Saving time and money now by not implementing and nurturing AI, will likely come back to harm these businesses in the future when it is impossible to make up lost ground while competitors streak ahead.
Here at The Missing Link we’re ready to start those conversations and help gain buy in, set up your technology to adapt to an ever-changing world, and monitor it on an ongoing basis so that you can focus on your speciality – providing best-in-class financial services to your clients. If you’re ready to get started, reach out today.
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