Why People Have More Significance than Ever in the Financial Industry
Conceivably, the financial service field is getting more challenging (or perhaps it has the biggest potential from another perspective), as a result of the introduction of robotic technologies and automatic systems which is more evident compared to other sectors. The level of adjustment driven by elevated usage of automation systems up to this point, has been vast and we are only scratching the surface currently. Technology advancements are literally shifting the manner financial service companies work, the ways their products/services are offered and the profitability is exposed to a more elevated risk to new, tech-oriented competition.
The effect this realization has on people is enormous. The biggest 12 investment banks globally have slashed front office workforce by over 20% over the last 7 years and its is expected that 32% of UK’s financial sector professions will be endangered by automation technologies by 2030.
The question is: are we slowly entering an era where people are no longer needed? A PwC study on CEO confirms that NO, this isn’t happening. The study involved 487 executives in Financial Service business and asked them to state the largest risks to their business—a whopping majority of 73% has emphasized the fast pace of technological advancements. Almost that many (72%) have identified the restricted possession of skills. In other aspects of the field, a hiring drive is in progress. 64% of executives in asset and wealth management companies have stated that they plan to raise their workforce in the imminent year.
Stated otherwise, in the field of automation, people’s importance is still higher than ever for the financial service sector. But, there is also an extra aspect behind such findings. What’s really impressive is that the sets of skills managers are looking for, are a hard to find.
Companies do look for data analysts, automation experts, and highly qualified technological talent, but there are skills that technologies can’t copy—flexibility, cooperation, and management skills which are increasing in demand every day. These sets of skills are assessed by Business Executives on the same level as conventional financial service skills e.g risk control.
There is no matter of machines and robots taking the place of people but an environment where people and new technologies will cooperate together. That implies adjusting the manner people think, act and cooperate.
The level of the task to be faced should never be downgraded. What experts are seeing is a solid reconsideration of people planning. Companies will have to evaluate the effect of emerging technologies on job duties, skills, reporting lines of work and organizational culture. The work structure of the majority of firms has to be fully redefined from skills to pay to match the changes on the traditional business model.
Are financial service companies and their HR lines ready to face the challenge? PwC study has revealed that there is still a long way ahead for substantial progress. 70% of financial level executives support that their firm has adjusted its people planning, but less than 25% support that this adjustment is vital. More than half (60%) support that they are reconsidering their HR activity and 48% report using data analytics to identify, nurture, and maintain talent. The Financial Service sector has excitingly open their arms to data analytics when handling customer connections. Now is the time to apply the same excitement to headcount management.
There are lots of aspects at risk. The companies that are not responding promptly to increased and shifting talent requirements, may find themselves in an unfavorable position where they will be faced with skill lacks, outdated working patterns, and struggling to stack against their competitors in a rapidly shifting competitive skills sector. An appropriate people strategy will assist financial firms to re-involve, take the lead and distinguish themselves.
The field is armed with intelligent and analytical folks who possess great problem-solving skills. This is a field that has always been subject to innovation and adjustment. Now is the perfect time to use such skills and abilities in people planning and taking the lead.