The future of work – automation and reskilling could be good for banks and workers

Automation, such as the more widespread adoption of artificial intelligence (AI) within banking and financial institutions, need not be a negative impactor on the sectors’ future workforce, Sibos 2018 was told, writes Roland Tellzen.

By Jon Watkins

Addressing a panel session on the Future of Work at Sibos, representatives of such institutions as Accenture, Merrill Lynch, Nordea and Australia’s Westpac were in agreement that banks could indeed use automation to create new opportunities for their existing workforces.

The key, they say, would be in reskilling their existing workers to make the most of their existing talents and passions, and presenting automation to their staff as an opportunity rather than a threat.

While acknowledging that the World Economic Forum earlier this year had warned that there was a significant mismatch between financial institutions’ skills and capabilities today and what would be needed in the future, the managing director and the global financial services talent and organisation practice lead for Accenture, Andrew Woolf, said the challenge was not unsolvable.

Indeed, he said, research by Accenture had concluded there were a great many benefits possible for both banks in general, and their staff in particular, through automation.

 “To do that, we have to get the collaboration going between AI and people,” he said.

He said the research had shown that a properly planned automation project, combined with reskilling and redeployment of staff, could lead to a 32% uplift in banks’ bottom lines in the next five years, while still producing a 5% growth in jobs within financial services.

The catch was, he said, that very few organisations had embarked yet on such well thought-out strategies in their workforce or reskilling programmes.

 “Only about 3% of organisations, by our reckoning, are planning to significantly invest in their workforce or reskilling at present,” he said.

 “I think fundamentally it depends on the organisation having the proverbial guts to get their vision for the future going; if you are willing to re-invest some of the dollar benefits of automation in their workforce.

 “But I think a lot of short-sighted organisations are just putting those savings in their back pockets.”

His views were echoed by the founder of Emotional Banking, Duena Blomstrom, who agreed that many organisations were just giving lip-service to future workforce needs. “We see people who are saying they are doing things, but it is just PR, it is boasting,” she said.

Indeed, she said critically, she believed that the “organisational psychology” of many businesses in the banking and finance sectors were not “fit for purpose” to properly address future workforce needs. “We need banks to show courage and passion – but that is a very big journey for banks,” she said.

 “Yes, in the future there is a need for new technical skills, but passion and fire is also important.”

Representatives of some of the world major banks told the panel there was a growing sense of urgency over the need to reskill their workforces to face the challenges of the future.

The head of inclusion and diversity at Australia’s Westpac, Samantha Turner, told how three years ago the bank had put into place a team to investigate how to best re-equip its existing 32,000 workforce for an automated future.

“When we began the journey, we were at first thinking of it having a ten-year horizon, but now we are realising it is getting more urgent – we are looking at targets of, say, 2020 already,” she said.

Bank of America Merrill Lynch’s head of GTS strategy, William Borden, outlined how his bank had been seriously talking about automation and its impact on its workforce for the past ten years.

“We began looking at it as a way to take costs out of our business,” he said. “But now we are looking to re-invest those savings, first in technology, and then in people.

“A lot of young people are not interested in going into financial services. In order to get them interested, we have to talk to them about how we are going to invest in them and make the most of their talents.”

Head of business innovation for Scandinavia’s Nordea Bank, Sophia Wikander, agreed, saying this meant the bank needed to look outside traditional recruiting avenues when hunting new staff. We are looking outside banking – to tech hubs for example, to try to convince people with good potential to join us and show them that there are opportunities for their talents within banking,” she said.

One aspect all participants agreed upon was the need to encourage diversity in their future workforce, both to match a diverse future customer base but also to encourage diverse ways of thinking in their future operations. This extended beyond traditional concepts like gender diversity or cultural diversity, and more into “neural diversity”, the ability to accommodate a variety of different world views, biases and attitudes. “When you are putting together a team to work on an AI project, you have to make sure you have people that are not just there in terms of the tech, but who can provide diversity in their way of thinking,” Westpac’s Turner added.

She noted that Westpac was already a champion of gender diversity, with a 50% gender split workforce already, but was extending that into greater social diversity, looking for people from different educational backgrounds, different social and cultural strata and from both rural and urban areas.

Diverse teams also needed to be recruited into AI projects in order to ensure that AI systems developed today did not include unconscious biases that would be perpetuated into the future. “With machine learning and AI systems, you have to make sure the algorithms do not have biases,” Nordea’s Wikander said. “We try to evaluate that all the time.”
Emotional Banking’s Blomstrom said while workforce diversity was a worthy ideal by itself it was not enough for the challenges of the future. “The ideal organisation is one that is not stuck in any one model about how to work together,” she said.

Speaking to Club@Sibos before Sibos, Genevieve Douhet, 
GTPS head of innovation, Global Transaction & Payment Services at Societe Generale, said digital transformation required banks to attract new talents, in a world where such talent can be in short supply. For example, she said, it is estimated that globally there is a shortage of data and cyber security professionals of between 25-40%.

The banking industry faces two main challenges: attracting and retaining the talent and experience required in the digital landscape,” she said. “We face competition from the bigtechs, digital platforms and startups, which are attractive to young people. But banks can offer millennials great work and technology experience that compare favourably with tech companies.”

For many years, she added, banks tended to source new graduates from the same universities or business or engineering schools. This resulted in a very homogenous set of profiles at banks. “I believe the trend is now to diversify the sources of talent as banks seek new skills. The technology changes we are witnessing and the way they are changing jobs means the way banks hire people is also changing. Rather than considering the type of degree someone has, it now makes more sense to understand whether they have an innovative mindset.”