APRIL 2018CIOAPPLICATIONSEUROPE.COM9allow it to harness the forces at play. Generalisations aside, without dramatic change, the industry might not be ready for the "new collar" jobs that will dominate the future.Fortunately, several tools and techniques are available to help finance with the changes needed. Firstly, fostering innovation is essential. But innovation does not mean investing blindly in an innovation lab and hoping for the best. Setting off on random experiments and aimlessly tinkering with emerging technologies will not cut it. Finance needs to think and act differently. Bringing in broad and diverse perspectives to supplement existing teams is one approach (e.g., hire a technologist from an entirely different industry). Secondly, individuals within finance need to adopt new mindsets. Too often, leadership falls in love with solutions and becomes enamoured with technology. Digital transformation is not about applying specific solutions or installing new technologies. Instead, falling in love with the problem ­ not a solution ­ leads to real customer-centric innovative strategies that are sustainable. Creating genuine learning opportunities, putting in place feedback loops, adopting a "fail safe and fast" mentality, and instilling a sense that improvement is continuous, are great ways to develop new skills and shift mindsets.Collecting more data, and data about that data comes third. There are many examples in finance where large amounts of data are utilised and applied to specific problems such as fraud detection, underwriting, and portfolio optimisation. Actuaries and quants push the limits of mathematics, economics, psychology, physics, and data science every day. These activities are often conducted in silos, with specific machines built for specific problems. Datasets are not nearly as connected as they could be, with hidden knowledge and meta-relationships going unnoticed. There are increasing opportunities to collect even more data about customers and markets through sensors and feedback loops. APIs can enhance consistent data exchange through platforms, networks, and devices in novel ways.And finally, collaboration with FinTech companies may still be the best strategy. It may make sense to invest or partner with a FinTech that already provides capabilities to address existing problems. In fact, thousands of financial and FinTech firms are already engaged at various levels. Finance can provide mountains of data and a deep understanding of the marketplace. The FinTech organisations can provide an understanding of the digital native, superior agility, and cutting-edge technical knowledge. The challenge is finding Tod McKennathe right partnerships. A great deal of innovation in the FinTech community is already addressing the customer journey, security, and privacy. Creative mobile apps, smart contract solutions, and new uses for AI are rolling out continuously.Finance has an opportunity to harness the forces impacting the industry using a variety of strategies. Fostering an innovative culture will open new pathways as fresh ideas emerge to address business problems. Bringing in broad and diverse people to supplement core staff, collecting and utilising data more holistically, and strategic partnering may lead to some exciting outcomes.
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