Philip Letts, CEO of global procurement platform blur Group says now is the time for CFOs and CPOs to unite.
Technology is changing accounting and financial management forever. That much we know already.
But in an era of economic and political uncertainty, when CEOs repeatedly cite cost reduction as their number one priority, is now the time for CFOs to push on and embrace technological change in a far wider sense?
Right now CFOs should be telling their teams that a key reason for their existence, processing accounting transactions, is gone. But the seismic change will not stop there. Technology is already impacting on another vital aspect of how organisations manage their finance - procurement.
Recent reports from the likes of EY, PWC and Deloitte have revealed the scale of procurement waste, which globally now stands at £1.56trillion a year. Yet spend optimisation, particularly across indirect spend, remains an Achilles heel for many CFOs, despite the recognised savings that can be achieved.
Today, some 20% of organisational spend is typically unmanaged, made up of the tail spend of numerous low-value transactions, often uncontracted and through many suppliers (up to 80% of the entire indirect spend supply base).
Ultimately, cost reduction is a key part of any business case for the use of technology. And responsibility for achieving cost efficiencies rests with the CFO. So they need to be ‘ahead of the curve’ when it comes to process improvements and system changes, including automation.
Just as CFOs need to guide their finance teams as they rapidly consider their future roles as technology takes over more of their ‘everyday’ tasks, so CFOs should be considering the role of their procurement teams.
Online global marketplaces, self-service portals, mobile apps and artificial intelligence providing transparent processes, access to suppliers across the globe and detailed insight on the price and demand across the full range of business services and goods, and indeed on suppliers themselves, is already starting to transform what for too long has been seen as the poor relation within financial departments.
According to Deloitte’s most recent global procurement report published in December 2016, the use of cloud-based platforms and mobile technology by procurement functions has doubled in just 12 months.
In accountancy, technology means less time spent on financial close, allowing more time to be a strategic asset to the business. The same shift is true for procurement functions, where the most progressive have already moved from fulfilment of contracts to spend optimisation including right-sourcing and fractional outsourcing.
Adopting technology for procurement covers a range of activity that sits under a CFO’s remit:
Just as most organisations have taken the key step of investing in software as a service (SaaS) models for their financial accountancy needs, simplifying processes with little or no customisation, so the same trend is happening in procurement.
And just as in accountancy, those that stick with legacy on-premise systems are also realising that having customised, non-standard systems and processes is costly and unsustainable if they expect to remain competitive.
Adopting and using technology successfully first requires a clear strategic approach, which is why CFOs should be the drivers to make procurement a more strategic and effective function using the right technology in the right way.
CFOs share many of the same preoccupations as CPOs, with cost control, risk management, technological advancements and talent development the top CPO priorities identified by Deloitte. Digital technology is receiving more investment, but often lacks the strategic context to maximise the potential benefits for the business (just 40 per cent have a clear digital strategy), which is why the CFO’s involvement is crucial.
The closer the working relationship between a CFO and CPO, the easier it will be to fully understand and maximise the opportunities across key aspects of a business - the efficiency of internal systems, how well suppliers are managed, compliance, evaluating the range of technology and sourcing options across direct and indirect spend.
In an era of on-going cost reduction, done strategically and driven by the CFO, a focus on procurement can start to drive stronger and longer-lasting cost reduction across wider aspects of the organisation. Where once we talked about procurement and supply chains, now is the time for spend management and spend optimisation strategies to come to the fore, and for CFOs and C-suites to consider the opportunities they bring.
2016 was an unprecedented year, with massive global political upheaval, the rise of Artificial Intelligence (AI), and centre stage being taken by issues such as ‘post-truth’, resurgent nationalism, and technological unemployment. These social, technological and political shifts have significant potential ramifications for all aspects of global finance, commerce and markets. Hence, with the world now more accustomed to such seismic agenda changing developments, the Fast Future Publishing team have turned our thoughts to the future and dipped into our recent book The Future of Business and our upcoming release The Future of AI in Business to suggest what might happen in the year ahead. Below we provide our 2017 year-end report, outlining 20 critical trends and scenarios we could see emerging, and highlight their potential impact on economic and financial markets.
Politics, Government and Regulation
Technology and Privacy
The Economy and Business
Social and Leisure
About Fast Future Publishing
At Fast Future Publishing we develop our books using an exponential publishing model, and we have completed the successful launch of our first two books – The Future of Business (top five per cent of all business books in its first year), and Technology vs. Humanity (Amazon bestseller within one week of launch).
We are a new breed of publisher founded by three futurists – Rohit Talwar, Steve Wells, and April Koury. Our goal is to profile the latest thinking of established and emerging futurists, foresight researchers, and future thinkers from around the world, and to make those ideas accessible to the widest possible audience in the shortest possible time. Our FutureScapes book series is designed to address a range of critical agenda setting futures topics that we believe are relevant to individuals, governments, businesses, and civil society
Rohit Talwar, Founder and CEO
Rohit Talwar is a global futurist, founder of Fast Future and an award-winning speaker noted for his provocative content. He advises global firms, industries and governments on how to survive, thrive, spot and manage emerging risks and develop innovative growth strategies in the decade ahead. His interests include the evolving role of technology in business and society, emerging markets, the future of education, sustainability, and embedding foresight in organisations.
Katharine Barnett, Concept Editor
Katharine works on creating, developing and editing a variety of content for Fast Future Publishing. She has a broad range of futurist interests including societal and behavioural norms, digital and information ethics, biomedical ethics, genomics and pharmacology, and the future economies of the developing world.
Looking back on last year's FinTech predictions, not many commentators accurately predicted where we would be entering 2017. As a professional advising both established financial institutions and new entrants, Claire sees an exciting year ahead and shares her key predictions with us.
I believe that the UK will forge ahead as a global FinTech leader despite Brexit. Building on its sandbox initiative and the signature of several FinTech co-operation agreements with regulators in the Far-East, the FCA will continue to launch progressive initiatives and reach outwards. As it did in 2016, the FCA will continue to provide leadership on global regulatory thinking and initiatives.
The growing trend of collaboration between FinTechs and incumbents will intensify in 2017. Due to a more challenging landscape for those looking to raise capital in Europe and the US, FinTechs will be increasingly willing to partner with incumbents in return for funding and market access, which will drive increased M&A activity. On the global stage, the explosion of Chinese FinTech activity and investment seen in 2016 will continue and Chinese FinTech will keep on dominating.
We will begin to see the impact of the regulatory initiatives designed to open up retail banking and payment services such as the EU's second Payment Services Directive ("PSD 2") and the UK open banking initiative. Several new intermediaries will enter the market, not just in payment services, but also across the spectrum of comparison sites and personalised financial management services. Some interesting business models and collaborations between banks and intermediaries will emerge as intermediaries own more consumer relationships.
The rise of APIs will bring increased threat of fraud and potential data breaches. The ability for consumers to share retail banking transaction data history with third parties via open APIs from January 2018 (as part of the open banking initiative) aims to stimulate competition for the benefit of consumers, but many will need comfort around security and potential for unauthorised use. Technical solutions for control of on-line use of personal data by the consumer (possibly blockchain-based) will gain traction.
Regulation of peer-to-peer lending will be tightened, impacting the existing business models and practices of some players. This, combined with a changing economic landscape, will result in casualties, but tightened regulation will also increase consumer confidence and pave the way for sustainable businesses as the market matures. One of the newly authorised UK challenger banks will team up with a peer-to-peer lender.
2017 will be the year in which Bitcoin achieves legitimacy. Overall global economic uncertainty will drive investors to look at Bitcoin as an alternative safe haven investment. The resulting increase in Bitcoin activity will in turn drive adoption, with more retailers willing to accept it and transaction volumes significantly increasing. This will move regulation of crypto-currencies up the agenda and we will see developing regulatory frameworks contributing to the legitimisation of Bitcoin and cryptocurrencies as a new asset class.
The proliferation of blockchain applications being piloted by the banks will encounter a wave of realism as the scale of the challenge of moving from testing to real life deployment becomes apparent. The hype will subside as projects stall but investment will continue and more clarity will emerge on the applications of the technology likely to succeed and the platforms which will dominate. One of the key issues for blockchain in 2017 will be how far trust has been affected by last year's "hack" of The DAO – a crowdfunded investment community built on the Ethereum blockchain platform.
AI and Machine Learning will be big FinTech trends in 2017, encompassing everything from algorithimic trading to personal finance bots. There will be more scrutiny from regulators on how investment decisions are being made as AI and deep learning play a greater role in investment systems. 2017 will also see banks responding to rising demand from the Gen Z and millennial cohort for chatbots (most likely through integration with existing social chat channels or smart assistants).
All in all, I believe that 2017 will mark a further leap in the evolution of FinTech and the world of financial services will continue to undergo a major technology-driven change.
To hear about the insurance industry’s evolution in the past 40 years, this month Finance Monthly reached to Joseph Petrelli. Mr. Petrelli began his insurance career in 1969 as a work study student at The College of Insurance, working for the predecessor organization to ISO. Since that date, he has been providing both actuarial and financial analysis expertise to the Property and Casualty (P&C) insurance industry. He has been actively engaged in the Title insurance industry since 1985. He has experience with loss and loss adjustment expense reserve evaluation, product development, and pricing for all P&C and Title insurance products as well as expertise with loss cost filings and Financial Stability Ratings® (FSRs).
Prior to founding Demotech, Inc. in 1985, he was employed by a large national P&C insurer, a regional property and casualty insurer, as well as Insurance Services Office.
Mr. Petrelli is the author of What We’ve Got Here Is a Failure to Communicate – How Traditional Financial Reporting Contributes to Misunderstanding of Title Insurance Loss Activity and has been published in many of the leading industry trade journals.
He is a Member in good standing of the Casualty Actuarial Society, American Academy of Actuaries, Society of Actuaries, and the Conference of Consulting Actuaries. Mr. Petrelli has a Bachelor of Actuarial Science from The College of Insurance (St. John’s University) and an MBA from The Ohio State University.
You have more than 40 years of progressively responsible property and casualty actuarial and financial analysis experience - how has the industry evolved over time?
The insurance industry’s evolution over the past four decades has been driven by the two concepts underlying Demotech’s name; demographics and technology. Demographics has impacted the life, health, property, casualty and title insurance sectors. Many life insurers now have clients that have lived to be 100 years old! Whether the issue is the graying of the insurance industry, the transition of leadership positions from Baby Boomers to Millennials, changes in the generational perspectives with regard to homeownership, telecommuting, personal, face-to-face service versus online efficiency and the implied cost savings of same, or 80 and 90-year old men and women having the physiological capability to live independently with a quality of life that is unprecedented: demographics is the driving force behind the evolution of the industry.
Similarly, technology has been instrumental in enhancing physical safety and ecological efficiencies; whether through automated safety apps that protect one’s home and contact you via smart phone when the doorbell rings or thermostat controls on a smart phone app. Concurrently technology offers challenges associated with cyber security and cyber bullying that emerged over the past several years.
Can you tell us a bit about the Financial Stability Ratings® that Demotech offers?
Financial Stability Ratings® (FSRs) summarize our unique perspective on an insurer’s ability to honor meritorious claims or otherwise defend the policyholder. “Stability” is the key variable that financial strength ratings often fail to measure. Stability implies that an insurer is focusing on core capabilities and sticking to its knitting. The best way to stay out of trouble is to do what you know how to do.
Other rating services seem to believe that possessing an abundance of capital concurrently provides the experience and expertise to assimilate into lines of insurance or geographical areas that are unfamiliar to the insurer. Stability and a focused and executable business plan are the keys to survival.
How do you tailor your services to the needs of each individual client?
We do not rely on black boxes, secret formulae or subjective criteria to assign our FSRs. We believe that ratings should be transparent and fair. In fact, we have created the phrase, Transfairency to describe our process. Tranfairency refers to a review and analysis of insurer financial stability that is fair and transparent. We believe that a process is fair when review and analysis focuses on balance sheet fundamentals presented over time, the quality and quantity of reinsurance, the carrier’s business model and the breadth and depth of its enterprise risk management program.
In terms of market competition, where does Demotech stand globally and what are its goals moving forward?
In the area of insurer ratings, as opposed to the rating of insurer investments and debt obligations, the reality is that a monopoly exists in insurer ratings. Despite the existence of a monopoly and the restraint of trade or boycott of duly licensed insurers that it creates, we have more than 400 clients operating in the US, District of Columbia and Commonwealth of Puerto Rico. We chip away at the monopoly each and every day for the purpose of leveling the playing field for financially stable insurers.
I read an interesting article recently that outlined the way in which cloud adoption has changed the business landscape, causing a seismic shift in how organisations operate. Depending on your source, UK cloud adoption rates are currently anywhere between 78% and 84%, and whilst cloud is no longer a new phenomenon, its importance to not only the CIO but also the full c-suite of decision makers such as CEOs, CMOs and CFOs, is paramount as they jostle to gain a competitive advantage over competitors.
It has been argued that cloud adoption heralds the largest disruption in enterprise computing since the advent of the PC, with many industries embracing cloud-based platforms to not only cut costs but also drive efficiency. Despite this, there has been a certain amount of trepidation from the financial services sector to make the transition and fully embrace cloud and its many advantages.
At the mere utterance of the word ‘cloud’ we used to hear a plethora of reasons why financial services organisations could not make the leap. There were concerns over regulatory compliance as well as the complexity of functional replacement, security and control. And, in an era where financial institutions are more highly regulated than ever before, one could forgive these organisations for a tentative approach to change – especially when it came to new technologies that cloud put compliance at risk. To further validate this hesitance, financial services firms are reportedly hit with security incidents 300 percent more frequently than other industries.
However, over the past year, the UK financial services sector has taken a more confident and proactive approach to cloud computing. In mid-2016, following the publishing of the Financial Conduct Authority’s (FCA) final guidance for UK regulated firms outsourcing to the cloud, it was made clear that there is no fundamental reason why financial services firms cannot use public cloud services, so long as they comply with the FCA’s rules. This statement and the guidance provided will certainly be welcomed by those UK financial institutions that have been hesitant to embrace cloud due to the lack of regulatory certainty over its use. This also serves as good news for the cloud sector too, providing a boost in the uptake of cloud services in the sector. Certainly, there are many examples of financial services firms using cloud while remaining in compliance with FCA regulations.
Regulatory compliance and managing cyber risk do not need to be the enemy of innovation. In fact, taking a risk-avoidant approach to experimenting with new business models, technologies or user experiences will be a fast path to obscurity in today’s business landscape, where innovation and competition can come from anywhere. Banks, hedge funds, asset managers, insurance firms and other players in the financial services ecosystem should seek out technologies that meet compliance and security needs but also enable agility and flexibility.
Here are three quick benefits that cloud can provide for the financial services sector:
By embracing cloud computing services, companies in the financial sector are able to add vast efficiency to their operations. As long as the risks can be managed, and with the right cloud service provider they can, there are many benefits. Cloud services – ranging from Production to Dev/Test to Disaster Recovery and backup - can help financial firms reduce setup and operating costs related to installing new IT infrastructure and negate the need to invest in more data centre space by making the necessary infrastructure resources available on demand. Perhaps most importantly for such a regulated industry, cloud services can help financial services firms gain IT innovation while protecting them against cyber-attacks, ransomware as well as maintaining compliance.
If your financial services firm has been hesitant about a migration to cloud computing, it may be time to reconsider. Enjoy stronger security, lower your maintenance costs and unleash the productivity potential of employees by migrating to the cloud.
Authored by Monica Brink, Director of Marketing, iland.
Virtual Reality (VR) and Augmented Reality (AR) were popular topics in 2016 and the industry is now considered as the technology of the future. The development of AR technology is changing the way people see and learn. According to a research report published by Zion Research, augmented reality market is expected to reach approximately $133.78 billion by 2021, with an annual compound growth rate of 85.2%. The research indicates that High penetration of smartphone and escalating convergence between AR and wearable devices continue to drive demand for the market.
The revolution of Augmented reality applications brings people a different kind of living experiences. For example, TryLive by Total Immersion changes consumers' shopping experience by enabling virtually try-on glasses, clothes and many accessories. Wearable display glasses enable people to run applications. The gaming sector benefits the most with AR technology, but the technology now is used in many other fields, like aerospace & defense, education, tourism, retails and e-commerce.
Vuzix Corporation is a supplier of Smart-Glasses, AR and Virtual Reality (VR) technologies and products for the consumer and enterprise markets just announced earlier today that, "the Company has completed, passed, and filed with the US Federal Communication Commission (FCC) all of the (FCC) emission's requirements for its next generation M300 Smart Glasses. Vuzix expects to commence shipping of the M300 Smart Glasses to customers in the USA and Canada within days of this filing. With FCC filings now in place and the recent certification for shipments to Europe completed last month, the Company is now positioned for the full commercial launch to its largest initial markets. Other major regions of the world should follow with submissions of their required regulatory filings through the first quarter of 2017, enabling Vuzix to expand its M300 offerings near worldwide.
The new Vuzix M300 represents the next generation of smart glasses, designed to address customer feedback from more than three years of productive use of the earlier M100. This field experience has led to the addition of many empowering, barrier-reducing features such as improved ergonomics, modern security capabilities, enhanced Wi-Fi and Bluetooth connectivity, and industry leading video streaming. These improvements are just some of the many that allow the M300 to be a central communications platform to and from a client's remote workforce, connecting their corporate data and IOT field devices in real time to the people in the field who need them.
The work over the last six months to establish the Vuzix VIP application software partner program has resulted in a significant pipeline of customer budgeted and approved projects awaiting the arrival of the M300. Vuzix will begin with production M300 shipments to these EU and US VIP partners who have been pre-allocated units for immediate deployment to their existing client base. In addition, we have many orders from customers that have taken advantage of the M100/M300 migration program and/or placed pre-orders for the M300.
These order pipelines are significantly greater than when the M100 launched and the Company expects that it will continue to enjoy robust growth in smart glasses revenues, as clients accelerate volume deployments. "We are now set up to ship the M300 to the hundreds of US customers that represent the beginnings of volume roll outs," said Paul Travers, President and Chief Executive Officer at Vuzix."
Cloud infrastructure and business mobility company, VMware Inc. announced the addition of new smart glasses management features to VMware AirWatch(R). According to the statement, the update will bring a consistent management platform to streamlined onboarding experiences, network setup and application deployment to organizations seeking to leverage augmented and mixed reality devices to transform business processes. VMware is the first unified endpoint management solution to extend into wearables, enabling customers to manage their smart glasses alongside existing desktop and mobile endpoints.
VMware is also working alongside with APX Labs, Atheer, Intel, ODG and VUZIX Corporation to help provide wearable management and application delivery solutions.
American multinational semiconductor and telecommunications, QUALCOMM Inc. company subsidiary along with developer and manufacturer of mobile head worn computing and augmented reality technologies and products, Osterhout Design Group announced that R-8 and R-9 will be the first announced devices powered by the Qualcomm's Snapdragon(TM) 835 processor, which uses 10-nanometer FinFET process technology to enable a new generation of premium consumer devices in small form factors with breakthrough performance and superior power efficiency. R-8 is Osterhout Design Group's consumer mobile Augmented Reality/Virtual Reality smartglasses, and R-9 is for a wide variety of wide field-of-view experiences from light enterprise.
Global semiconductor company, STMicroelectronics reported that its LSM6DSM 6-axis Inertial Measurement Unit is now to be used in next-generation mobile devices running with Alphabet Inc. (NASDAQ: GOOGL) high-performance virtual-reality platform, Google Daydream, along with a platform that maps 3-Dimensional space enabling it to be overlaid with virtual objects, Tango. "Certification of ST's 6-axis motion-sensing device for operation with Daydream and Tango for amazing virtual- and augmented-reality experiences demonstrates our abilities to design and deliver an exceptionally accurate and power-efficient IMU," said Aymeric Gisselbrecht, Vice President Global Key Accounts Sales, and STMicroelectronics. "Our long-term developments in sensing and actuation, along with our work with Google, are contributing to making mobile applications incredibly immersive and even more fun."
(Source: FinancialBuzz)
Deloitte predicts that over 300 million smartphones, or more than one-fifth of units sold in 2017, will have machine learning capabilities within the device in the next 12 months. The 16th edition of the "Technology, Media & Telecommunications (TMT) Predictions" showcases how mobile devices will be able to perform machine learning tasks even without connectivity, which will significantly alter how humans interact with technology across every industry, market and society.
However, over time machine learning on-the-go will not just be limited to smartphones. These capabilities are likely to be found in tens of millions (or more) of drones, tablets, cars, virtual or augmented reality devices, medical tools, Internet of Things (IoT) devices and unforeseen new technologies.
"Machine learning is fascinating as it will revolutionize how we conduct simple tasks like translating content, but it also has major security and health consequences that can improve societies around the world," said Paul Sallomi, vice chairman and global TMT industry leader, Deloitte LLP and US technology sector leader. "For example, mobile machine learning is a strong entry point to improve responses to disaster relief, help save lives with autonomous vehicles, and even turn the tide against the growing wave of cyberattacks."
"Our predictions for 2017 showcase the enormous influence that machine learning and the Internet of Things are having on the current technology marketplace," said Sandy Shirai, principal, Deloitte Consulting LLP and US technology, media and telecommunications leader. "With many technologies coming into their own as their power and speed increases and the cost of delivering them goes down, we'll continue to see these platforms grow exponentially and expand their role across industries, creating a whole new value proposition and opportunities."
Another innovation with the power to transform the world is autonomous braking. Deloitte predicts that in 2022, in the US alone, fatalities from motor vehicle accidents will have fallen by 6,000, a 16% decline in 2017. The greatest factor in this decline will likely be automatic emergency braking (AEB) technologies. Deloitte expects that AEB will be so widely adopted, affordable, and successful at helping to save lives that it may even slow down the movement toward full self-driving cars.
It's not just about developing new technology, but how this technology is procured that is set to transform how we live and work. Deloitte predicts that by the end of 2018, spending on IT-as-a-Service for data centers, software, and services will reach nearly $550 billion worldwide, up from $361 billion in 2016. Although flexible consumption-based business models will not be ubiquitous by 2018, at over a third of all IT spending (35%), they're expected to exceed half a trillion dollars and grow rapidly. This shift will begin to transform how the IT industry markets, sells and buys technology across businesses worldwide.
(Source: Deloitte)
There are three key challenges currently facing the financial services sector: building trust with customers; embracing new technology; and challenging the challengers as more businesses look to diversify and offer new innovative products and online services. It’s an interesting time, and one where communications are critical.
To combat these challenges, all businesses have to think about the way they engage with audiences and tell their story. Financial services firms in particular need to be seen as human-facing businesses, which is why creating an emotional connection has become as central to a successful communications programme as the value-led product information you provide. In the past this has been far more common in the consumer marketplace.
From smaller start-ups to larger, more established corporate machines, both ends of the scale need help to do this in different ways. The latter often benefit from a focus on refreshing their communications approach and revisiting their market position, such as identifying more engaging and digitally-focused channels (vital given the current landscape of disruptive and challenger SMEs). The former, such as FinTech brands challenging the status quo, need help to build their brand and instil confidence in customers where the brand has a less supporting heritage to build a credible market position.
At Speed, we build a partnership and consultancy position with all our clients from the start to help them on their journey. Working with a wide range of finance and professional services clients, we are particularly adept at supporting organisations with a brave attitude to their communications who are looking to disrupt the market.
Our approach to communications is based on combining business brains with creative muscle. This means utilising intelligence and insight, alongside imagination and creativity. By combining these with the influence and connections we have with media and stakeholders, we create real impact for our clients.
The word impact is key for us. When approaching our work, we always consider the impact and how we can offer a return on investment. The bottom line is in fact a hugely important factor when it comes to external communications – how will our efforts support business development?
Thought leadership positioning to create brand awareness and reputational growth is central to this. From the start of a relationship, we believe it is important that we work closely with leadership teams to understand their challenges, and help to identify their vision, mission and leadership offer. Communications and marketing has an important role to play and should be driven from the top down, so we spend time with our clients to understand their business. We also take a deep dive into their marketplace to understand market trends, core competitors and key stakeholders so we have a clear view on market positioning plus barriers and opportunities.
Telling your business story in an engaging and emotional way allows you to connect with an end audience and demonstrate what you have to offer. Understanding audience groups by segmenting key decision makers and influencers to discover what they need and the challenges they face is key to this. This insight then informs the central narrative we create and the journey we aim to take a business’s various audiences on.
The truth is, it is becoming harder to stand out from the crowd. Businesses therefore need to be brave in their approach and willing to say something different, to have a point of view. This is particularly relevant in the world of financial services where everyone is vying for the same commentary space, to be seen as an expert commentator on growth, the economy, and of course – for the moment – Brexit.
Over the last ten years in the communications industry, we have seen colossal changes in the way we work and communicate; technology has been hugely beneficial but has also brought with it new challenges. We are no longer in a world where we simply push out content. We are now in a two-way discussion with audiences.
The use of social media channels and online content hubs have helped us to communicate news for our clients and provide commentary faster and more efficiently. These channels allow us to engage, have conversations and build emotional connections with audiences. And the speed at which this content is consumed is only expected to increase.
For me, remaining curious and relevant for our clients is key to helping them stand out from the crowd – with our business insight and intelligence we demonstrate this daily. When this is combined with creative thinking and channel knowledge, we are able to identify even more opportunities to deliver our clients’ stories to their target audiences in new and engaging ways. Together we are on an exciting journey and a strong partnership from the start is key to our joint success.
Commenting on the Chancellor’s package of measures to support UK fintech, including a £500,000 a year investment for fintech specialists, Warren Mead, Global Co-lead Fintech, KPMG, comments:
“The UK is a leading global force in fintech but we’re losing power to China rapidly and the announcements in the Autumn Statement will struggle to reverse the trend.
“UK fintech investment has seen a considerable decline throughout 2016 as investors keep a keen eye on the aftermath of the EU referendum and the UK’s changing relationship with America. In fact Europe has not registered a single mega-round (US$50m+ ) in 2016 while Asia has registered 12.* The rise of China is indisputable and picking up pace, four of the top five spots on this year’s top 100 fintech firms were held by Chinese companies.
“Across financial services we’re hearing people talk about technology investment but change is happening too slowly. If we look at banks, they invest just 1-2 percent of their revenue into research and development whilst in technology firms it’s more like 10-20 percent. When one of the technology giants like Google turn their attention to fintech in a serious way we will see dramatic change and it will happen fast. The question is whether Asia will be first? With the diversity of investments and widespread support for the growth of fintech hubs in the region, it’s a very distinct possibility.”
(Source: KPMG)
By Paul Davies, head of business diversification, Audatex UK
You don’t have to look very far to see that autonomous vehicles are driving the technology news agenda. Pardon the pun, but it’s true. From Tesla to Google, Apple to Uber – there’s been an explosion of interest in the automotive industry, with big players from different sectors trying to muscle in on the act. Last year, there were 1.5 million cars sold in the UK already equipped with the necessary technology to be autonomous. Research suggests that by 2025, 25 per cent of the UK’s cars will be autonomous, a number that will increase to 50 per cent by 2040.
Furthermore, a little known fact is that the UK is one of the few European countries that decided not to sign the Vienna Convention on Road Traffic in 1968, which states drivers must be in control of their cars at all times. This convenient gap in regulations has left the door wide open for the UK to lead the way when it comes to autonomous test drives, which are already taking place all over the country. There is no doubt about it: Driverless cars are going to shape the world’s automotive landscape over the next few years, something that will undoubtedly have a massive impact on the insurance industry.
At a recent insurance industry event we hosted, one of the speakers - Paolo Cuomo of Charles Taylor/InsTechLondon - described the moment his 10-year-old daughter explained that neither she, nor her little brother need to learn how to drive. Her reasoning was that driverless cars will soon be able to take them everywhere they need to go - like a driverless (and thus relatively cheap) taxi service. I remember starting lessons as a teen, feeling overwhelmed by the sense of power and responsibility I felt sat behind the wheel. Getting my license required hours of revision and practice, to make sure I possessed the reaction skills, awareness and attention to detail needed to safely navigate a car on the road.
As driverless cars become the norm, younger generations may develop this perception that autonomous vehicles are safe. If that is the case, people may shy away from learning to drive all together – instead relying on technological developments in driverless vehicles, and opening up the idea that cars will soon become ‘chauffeurs’. Given that autonomous vehicles are still far from fail safe when it comes to accident avoidance, the industry does have a bit of time to work out how best to address that changing environment.
What will car insurance in the future look like?
As an insurer, what would you do if someone came to you and asked for an insurance policy when they have a fully autonomous car, have a licence, but have never owned a manual operated car before? How do you calculate what their premiums should be? They might assume that having a driverless car would automatically reduce their premiums to a minimum, but how would that change if they had previously owned a manual car before? Research shows that young drivers (16-19 years old) are a third more likely to die in a crash than 40-49 year olds. Because of this additional risk factor, young drivers find their excitement at passing and getting their first car comes screeching to a halt when they see how much insurance will cost them. Do industry statistics like that count, or individuals driving experience count when it comes to insurance premiums and their choice of car in the future? These are the kinds of questions we need to answer as an industry.
If driverless cars take off, we should also be asking ourselves what exactly we are insuring. In the event of a crash, it’s difficult to pinpoint where fault lies - whether it’s the car manufacturer, the software provider, or the passenger?
This question of ‘Who?’ will actually need to be opened up to a much broader field – one that goes beyond purely the automotive insurance industry. With the Internet of Things (IoT) getting bigger and more diverse, it’s only a matter of time before we see a blending of the home environment and the car. Just like how life insurance premiums differ depending on your lifestyle, I can already see the day where insurers will move from insuring possessions to insuring people and the ‘things’ they interact with. And all insurance they take out - whether home, phone, travel, pet or car - will depend on the person and their lifestyle.
This is great news for the consumer, as it flips the current system on its head. No longer will they need to look on countless comparison sites to find the best deal, but rather insurers may end up competing for their business. For example, if they exercise three times a week, drive safely, leave all their valuables indoors with a premium smart security system and only spend holidays in Iceland (the safest country in the world), then they are a safe bet for insurers and at the top of their wish-list. If customers can provide the data proving they have a ‘virtuous’ lifestyle, then this power shift will be an interesting one to watch unfold.
As discussions around driverless cars become more frequent among insurers, these are just a few of the topics that will be at the forefront of their minds. From assessing legal implications, to thinking about the apportioning of blame - the questions are endless. It is up to the insurance industry as a whole to come together, ask these questions, discuss them at length and come to ethical, logical conclusions. It’s not just up to us - consumers will no doubt have a loud voice when it comes to how they interact – and we all need to make sure we listen.
Sage, a market leader in cloud accounting software, announced at Sage Summit 2016 its strong commitment to future technologies, with a focus on new and existing partnerships that power business growth. Revealed during CEO Stephen Kelly’s keynote address, which opened the world’s largest gathering of entrepreneurs and business builders, Kelly spoke about how, through the use of the latest technologies and tools, Sage is levelling the playing field for entrepreneurs – and it’s just the start of the technology revolution all entrepreneurs and business builders of all sizes need to be a part of to compete and grow.
Investing in the future with the introduction of Sage Cloud
The dedication to helping businesses grow is a personal crusade of Kelly’s. Following the investment of £139m on research and development during FY15, the Sage CEO used the keynote as a platform to set out how all Sage products will now be connected to the cloud, with new mobile, social, chatbot and IoT offerings in the pipeline for the entire portfolio.
Sage Cloud will allow businesses to integrate all activity across Sage products quickly and easily. It will also make it possible for Sage customers to activate integrations with partner products within a few clicks and will eliminate the need for maintenance or change due to product upgrades. Sage further pledged its dedication to the developer community with the launch of Sage Marketplace, a new open, API-driven platform for Independent Software Vendors to showcase their Sage developer add-ons and apps.
Industry firsts – leapfrogging the competition
Another highlight was the official launch of Sage’s new admin bot, Pegg, a smart assistant that allows users to track expenses via their chosen messaging app. Pegg removes the complexities and enables entrepreneurs to manage finances through conversation. By digitising information at the point of capture, it takes away the pain from receipts and expenses, eradicating the need for paper and data entry.
Powerful new partnerships
This coincides with the news that Sage has partnered with Slack, which will act as one of the core messaging channels connected to Pegg. Having recently joined as Global Director for Mobile Product Management, Sage’s Kriti Sharma said: “With the rise of freelancing and the sharing economy, the number of small businesses is growing exponentially. Most of these business owners use messaging apps, and with Pegg we aim to bridge the gap between these apps and work, rendering accounting invisible to the end user and making running a business as simple as sending a text. We’re incredibly excited to partner with Slack, the fastest growing enterprise messaging app; together we share the vision that the future of the workplace is conversational, easy and fun.” Announced with a demonstration live on stage, the accounting industry’s first bot, Pegg is available now in Beta. New users can register to sign up here for Slack or here for Facebook messenger.
In an interactive live demo, Sage’s new EVP of Product Marketing, Jennifer Warawa, showed how the combined solution of Sage Live and TomTom Telematics works. The new software integration allows businesses with fleets of vehicles - small or big - to seamlessly record mileage and automate expense reports. Because Sage Live is running on the Salesforce platform it can easily use existing integrations with third parties such as TomTom WEBFLEET. Via the fleet management, service journey data is automatically available in Sage Live.
There were several new partnership announcements, as well as details on how existing ones have strengthened. In front of an audience of 15,000 and over 35,000 on LIVE stream, Stephen Kelly announced that Sage’s award-winning real-time accounting solution, Sage Live, will harness the power of Salesforce Lightning. Via the integration, Sage customers will benefit from Salesforce’s new Lightning Experience – a reimagined consumer-like experience that’s modern, efficient and smart – which will be accessible via Sage Live across every device.
Microsoft CEO Satya Nadella joined via video to announce the coming together of Microsoft Office 365 and Sage 50 – making Sage the first ever software company to partner with the platform. The Sage CEO also welcomed Sir Richard Branson to the stage, where they participated in a conversation on their shared vision of the future of business and giving back.
Champion of Business Builders
Sage’s commitment to supporting entrepreneurs at every stage of their growth was underlined with Kelly revealing new stats on entrepreneurs’ dissatisfaction with the support they get from the US Government. He also reiterated his criticism of ‘out of touch’ events like the World Economic Forum in Davos and announced a series of policy events around the world
The Giving Economy
Broadening out to touch on Sage as a participant in its communities, the keynote highlighted how Sage will expand its corporate philanthropy initiative, Sage Foundation, through work with three distinct communities; military veterans, young people and women. Sage’s Chief People Officer Sandra Campopiano launched a new open grant process with a donation to an inspiring Chicago charity that seeks to inspire more women to work in the technology sector.
She awarded a $50,000 donation from Sage to Brave Initiatives, a program encouraging high school girls to see themselves as capable coders and tune them into community issues.
Sage CEO Stephen Kelly said: “It was almost impossible to tell the story of the technology revolution at Sage in one keynote. With a more connected world comes new demands on our hero business builders, and we are fired up by doing everything we can to support entrepreneurs in following their passion. We are working on making concepts like the Internet of Things, machine learning, blockchain and data sciences into a reality for businesses, accountants and partners. This is way more than cloud and mobile-first. It’s designing and building technologies that truly power businesses, freeing entrepreneurs to grow and win.”
For those not attending Sage Summit 2016, all of the keynotes and more can be viewed at the virtual event http://bit.ly/29N0zbE
More Information on Sage Live can be found here
(Source: Sage)
In an attempt to give companies the ability to experience how technology is transforming the financial world and how it can be deployed to solve critical business issues, an ultra-modern innovation centre has recently opened its doors in central London.
Dedicated to next generation banking and finance, the state-of–the-art centre was launched by Synechron Inc. – a global consulting and technology innovator in the financial services industry, which has plans to open innovation centres in New York, Florida, Amsterdam and Pune over the next few months. The first innovation centre that the company launched was in Dubai in October 2015 and was the first of its kind internationally.
Through the combined innovation of augmented reality, artificial intelligence, block chain, natural language and biometrics, mobile, and touch and smart technologies, the brand new centre gives businesses the chance to fully immerse themselves in the plethora of new technology available.
The Synechron Digital Innovation Centres’ aim is to act as innovation hubs for individuals and businesses willing to invest in technology and particularly in digital transformation - solving critical business issues and scaling these investments to achieve greater future business success.
The Synechron’s centre will be fully-operational from May 25th 2016 and will offer a number of options: from a half day of brainstorming session for executive management, to a rapid prototyping challenge, or even just a one hour dedicated technology workshop. Some of the key technologies available to visitors include artificial intelligence, Amazon Echo (Alexa), new apps around block chain and tablets with new apps and gamification.
Faisal Husain, CEO of Synechron, said, “We envisioned and invested in building a space where our clients can come and touch the latest in the digital world, get inspired and learn about what trends and technologies are disrupting their customers’ banking experiences worldwide. We want to help our clients be at the very forefront of digital transformation to drive an entirely new concept of banking interaction and engagement.”