This article was first published on Global Banking & Finance Review.
Artificial intelligence (AI) is everywhere. We use it in our daily lives whenever we buy something from Amazon, ask Siri a question or need online customer support.
So, it’s no surprise that AI is gaining momentum in banking as well. Banks are already using AI for real-time fraud detection and chatbots, but there’s an immense array of potential other uses. AI could help banks provide live information to regulators, predict trends in customer behaviour and tailor products accordingly, or create an organisation with no barriers between geographies or functions.
But when faced with so much potential, where should your energies be focused? And how do you stop just tinkering around the edges and truly transform with AI?
Where to start an AI transformation
We believe any approach to AI should be centred on three key stages:
Stretch the boundaries of what you think is possible. Rather than limit yourself by setting a strict and inflexible long-term plan, focus on some ambitious goals and define the general direction for the firm. You can then kick-start several shorter-term initiatives to push towards those goals. This will give you flexibility and a more responsive route to success.
Pick a low risk, high impact business challenge and get started. Do you want to drive revenue growth, reduce costs, or provide your existing customers with a better experience? Whatever it is, give it a try. You’ll gain a better understanding of new technologies and their true business value, which will help refine your broader goals or vision. When you’ve had success, no matter how small, build on it. Identify more complex business issues, expand your capability, and scale fast.
Build capability around automation tools, machine learning and advanced data analytics now. Demand for these skilled resources is already high, and will only increase in the coming months and years.
The internet giants are masters of approaching new technologies and absorbing their power to transform their business and offerings. Whether it’s Amazon embedding Alexa into every room in your house, or Google using AI to fine tune YouTube’s video recommendations (resulting in a doubling of average watch time year-on-year), they’re investing, experimenting, learning and refining their plans.
Curious about how AI will revolutionise retail banking? Our interactive illustration can help you understand.
We believe AI presents a transformative opportunity for banks that could re-invent the way they interact with customers, with regulators, and with one-another. But only for those that adapt and act quickly to harness the power of AI.
To show where these opportunities lie, we’ve created an interactive map of AI applications in banking. Take a look to see what AI can do for you.
Jason Hill is a financial services expert at PA Consulting Group