┬áEach time one looks at the challenges of what is broadly referred to as Fourth Industrial Revolution (4IR) and what it throws up at contemporary businesses it becomes hard to avoid saying that there is an element of magic to what is happening.
What we thought of not so long ago as sci-fi is turning out to be real and impacting the very existential necessities of businesses world over. In fact it isnÔÇÖt even businesses that are transforming, but the ways people experience, connect and consume as well. Innovative technologies, many of them life Artificial intelligence (AI), embed intuitive capabilities in machine and in the softwares that powers it, reducing the role of human intermediation.
If one looks at the latest technologies paraphernalia, some of it still emergent while much of it is in existence today, it becomes apparent that the physical and digital realms are being woven intricately and impacting profoundly experiences and outcomes.
The legacy nature of doing business is being broken down with the advent of alternate engagement opportunities. From the perspective of the financial services industry, the changes. Some of which are already in vogue and some still on the horizon, are revolutionary.
A few years ago, distributed ledger technologies were just a concept. Now governments in Dubai, are working intensely on putting the technology to use given its transparency and efficiency. In the case of the remittance industry. the potential of the technology to facilitate disintermediation of the money transfer value chain has attracted substantial interest, particularly at a time when rampant de-banking is a rising challenge.
Blockchain stand out as a promising game changer for the entire banking, financial services and insurance ecosystem. Just as recently as a couple of months ago, the State Bank of India announced moving its reconciliation, remittance and trade finance operations onto Blockchain by the financial year 2019. It is anticipated that this year will lower the bankÔÇÖs costs associated within three functions by 40-50 per cent.
In a world where AI-Powered technology is increasingly making waves, chatbots may have lost their novelty, having been deployed across many customer-facing businesses, as well as on social media, for some time now. That being said, the traction AI is getting across businesses cannot be understated. Look at Nora, the robo-advisor of the largest Nordic bank, Nordea Bank AB, specialized in wealth management and investment banking. Elsewhere; in professions like health care and legal, AI-powered platforms like IBM Watson Health and ROSS are creating a sensation.
What was imaginative a few years ago is no more so. AI and Machine Learning solutions that mimic human intelligence is increasingly becoming part of everyday business. If reality can be any weirder and of fictional flavor, consider this: according to some reported estimates, by 2025, 10 percent of the worldÔÇÖs population could be wearing clothes connected to the internet, and some of them may even have implantable mobile devices on them. That is solely due to the promise of internet of things (IoT).
Of course, opportunities of the digital economy also come with their set of challenges to businesses, as much as they continue to reveal trailblazing innovations.
For one, the inclusion or onboarding of unbanked adults onto financial services platform has become easier and faster, we still have a long way to go with about 1.7 billion people across the world still unbanked. However, when you live and breathe innovation, confidence in achieving the inclusion goals tend to be high. Now, simply owning a smartphone place one at threshold of financial freedom and empowerment, thanks to connectivity and technological convergence.
Ever-expanding mobile phone usage and internet connectivity is enabling people from remote parts of Sub-Saharan Africa to gain access to formal financial services, particularly in the case of remittances and cashless payments. Globally, it is reported that 52 per cent of adults have received or sent digital payments, a number that has increased from 10 per cent in 2014.
Today, bespoke and intuitive customer engagement as well as big data and analytics are integral to business planning and strategy. However, the ways companies have traditionally leveraged customer data are all set to undergo a massive transformation with new regulations like EUÔÇÖs General Data Protection Regulation (GDPR) coming into effect.
Businesses will need to shore up their competencies in line with the new age of technology. For instance, in an era of driverless cars, automobile manufacture will need to be just as competent in building transmission chains as with integrating navigation hardware and software systems into production line. The concomitant impact of these changes on the supporting industries and services, including the workforce, will also be huge. Professionals may need to reskill, and in some cases de-school, to adapt to the brave new world of digital world.
The old adage ÔÇô change is the only constant ÔÇô is all truer in the case of the digital economy, which continues to break the stereotypical silos of ÔÇÿusÔÇÖ and ÔÇÿthemÔÇÖ, coalescing a broad ecosystem of consumers, corporates, partners and many others.
Source: CEO Middle East magazine, June 2018