Algorithms and emerging technologies offer opportunities to ignite growth and enhance the client experience. “Technologies such as voice command, artificial intelligence, augmented and virtual reality, and haptics (relating to the sense of touch) could all play a role in the transformation of the client experience,” states Mike Durbin, President of Fidelity Institutional.
Companies can create competitive advantage if they:
Architect for real-time. While digitization of service lays the groundwork for continuous flows of customer data, companies will have to further transform their architecture from batch processing to real-time streams in order to effectively train machine learning models. Real-time algorithms supported with dynamically changing data architecture can open new domains of business opportunity.
Today, real-time algorithms detect fraud. Tomorrow, continuous customer and end-user data feedback loops identify unmet customer needs, generate new product ideas, drive product differentiation and value alignment — all while leveraging the power of data-network effects. Unlike user interface fads and easy-to-duplicate customer experiences, this type of on-demand, supply-side operation requires substantial effort to imitate and consequently yields significant competitive advantage.
Empower algorithms to fuel our vitality. Firms can use algorithmic thinking to increase the velocity at which they shift strategy and process to accommodate fluid markets. Taking a page from Alibaba’s approach, companies can spur vitality by deploying multiple business models concurrently, and then adopting those that best fit market conditions.[i] “If manual work … could be automated, humans could spend more time on the high-level work, like building and maintaining client relationships,” says Andrew Brzezinski, who is leading the efforts for Artificial Intelligence in Fidelity Institutional.
Train employees to collaborate with AI sooner rather than later. People resist collaboration with algorithms, despite their proven ability to deliver consistently better results than human intuition alone. To encourage people to work with algorithms, it may be important to provide case study examples of the complementary value algorithms deliver.
At Wells Fargo, research analysts developed a bot called AIERA (artificially intelligent equity research analyst) that formulates a point of view on whether the stocks it tracks will go up or down. The human analysts recognize the bot has advantages over them in consuming and analyzing data, but they still have the upper hand in framing the work and synthesizing the results.[ii]
As algorithms take over more human functions, firms can be aggressive about giving employees the opportunity to work with smart machines. The technology has enormous upside and productivity. Yes, it will require a mindset shift. But just as products are now “designed to change” instead of “built to last,” so will our working lives transition from fixed functional roles to adaptive, fluid careers that deliver higher value and provide us with a greater sense of purpose.