Executive Summary
An empirical study on AI adoption across 151 organisations in the financial services industry found that over three-quarters of all respondents expect AI to form an integral part of their business within two years.*
*Cambridge Centre for Alternative Finance and World Economic Forum, Transforming Paradigms: A Global AI in Financial Services Survey, Q3 2019
Currently, the most frequent use of AI is in risk management (54%), with the generation of new revenue potential the second most frequent use-case (52%); however, an overwhelming 95% of survey respondents expect to be using AI technologies to drive revenue-generation in the next two years. We are experiencing a shift in perspective among global enterprises to utilise AI technology to drive increased revenue generation, improved decision making and to empower front-office employees with instant, actionable insights so they can outperform. This white paper draws on discussions we have had with enterprise leaders across the financial services, recruitment and real estate sectors to assess the requirements of a successful digital transformation and will identify two key outcomes from its implementation.
Our findings from discussions with C-Suite executives in the financial services industry have been supported by a research report carried out by the Cambridge Centre for Alternative Finance and the World Economic Forum which found that 85% of organisations are currently using some form of AI within the business. We very rarely have discussions with business leaders in which the value and opportunities presented by AI are not appreciated. However, we believe that 2020 will be the year to progress digital transformation strategies from “explore” to “action”. With that in mind, this white paper aims to present a framework for a strategic approach to successful digital transformations and to identify two specific outcomes which should result from its implementation.
Align business goals and digital transformation strategies to achieve success
Gartner’s Fourth Annual Chief Data Officer Study found that 72% of CDO respondents are now business-goal-driven in the implementation of digital transformation strategies. This represents a shift away from being technology-driven (21%) towards a more strategic, objective-driven approach. CDOs are also prioritising internal data and analytics use (63%) versus the monetization of data and analytics information (31%).
Harness alternative data streams to drive better management enterprise decisions
The importance of data-governance
Many organizations have started their data governance journeys to achieve data intelligence, but they have not automated their data operations to create sustainable and repeatable practices. Without an accurate, high-quality, real-time enterprise data pipeline, it can be difficult to uncover the necessary insights to make optimal business decisions.
Research done on 151 fintech and financial services organisations across 33 countries found that leveraging alternative datasets to generate hidden business insights is a key part of harnessing the benefits of AI. The survey found that 60% of all respondents utilise new or alternative forms of data in AI applications.*
*Cambridge Centre for Alternative Finance and World Economic Forum, Transforming Paradigms: A Global AI in Financial Services Survey, Q3 2019
Drive a culture of data-literacy across the enterprise
What is “data-literacy”?
Data-literacy is a term that has emerged relatively recently to describe an enterprise’s ability to read, write and communicate data in context. Data-literacy includes the understanding of data sources and constructs; analytical methods and techniques applied; and the ability to describe the use-case application and resulting value.
Iterative change drives positive outcomes
Gartner Research’s Distinguished VP Analyst, Debra Logan, points out that “data-driven decisions” can seem like an unfamiliar and concerning concept.* Humans tend to want to use the data they have to support decisions they have already made. At FeedStock we have seen how iterative change, along with the close alignment of business goals with a digital transformation strategy, leads to successful implementation of a culture of data-literacy. Enterprises operating in today’s increasingly digital environment are generating data at an exponential rate. However, big rewards await those who embrace the challenge of unlocking the insights within that data to drive better decision making, operational efficiencies across the business, and improved performance for the “knowledge workers”.
*Gartner, Data & Analytics Leadership and Vision for 2020, January 2020