The present invoicing and billing technologies were developed to manage the payment processes for businesses. Paper invoicing remains a popular option for several companies in the United States. But the majority of them have shifted to electronic methods of billing and invoicing.
The country was lagging far behind to adopt the technological advancements in electronic invoicing compared to Europe and Latin America. However, the current trends have revolutionised electronic billing and invoicing for the past couple of years.
These advancements are responsible for the gaining popularity of the current invoicing and billing technologies. Let’s see how technology has shaped the way businesses in America send bills and invoices to their clients.
Automation of the Invoicing Process
The automation of the invoicing process has reduced the need for companies to track their financial transactions. Most companies in the United States have stopped using paper bills. Even those companies that have not automated their entire billing process prefer using blank invoice templates for service providers.
Automation of the process enables organisations to get reminders for due dates and delays in receiving payment. It has also helped companies in the country stay on track with their billing and payment schedules.
Automating the manual responsibilities of creating and sending bills allows business owners and staff to focus on other essential tasks. Companies can also save money because they do not require additional staff to take care of these responsibilities.
Several companies have also adopted blockchain technology to streamline their billing and invoicing processes. It allows them to keep a record of all their financial transactions. It also eliminates the need for additional resources or third-party vendors.
Automating the manual responsibilities of creating and sending bills allows business owners and staff to focus on other essential tasks.
Blockchain technology has not only made financial management smoother but has also improvised the entire invoicing process. The technology prevents any manipulation or accidental deletion of invoices once they are recorded and sent to the client, thereby eliminating the risk of fraudulent activities.
With the gradual adoption of blockchain technology in American businesses, we have started noticing the decline in traditional invoicing systems.
AI and Machine Learning
The advancements in AI and machine learning technology have taken the automation of invoicing solutions up a notch. Most software providers can offer a holistic approach that features functionalities beyond the basic invoicing cycle.
The intervention of AI and machine learning unlocked humanly unimaginable software abilities. Companies can process hundreds of invoices in a short time while processing significant amounts of financial data.
It is also easier to identify or verify past transactions, which gives the business better control over their cost and supply chain. Using AI and machine learning technology can also spot anomalies and errors with the least amount of human intervention.
Cloud Invoicing
With the increase in the use of the Software as a Service (SaaS) model, most billing technologies have started operating from the cloud. They allow businesses to access financial records and data from a device connected to the Internet anywhere in the world.
Cloud-based invoicing also enables people to receive real-time business updates and take the required action. Business personnel can address any urgent issues with the payment in real-time to maintain their company’s reputation. Digital wallets have also become a part of cloud invoicing already.
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Most business owners and managers can access cloud invoicing through mobile apps these days, which has made the process extremely convenient. With the increase in remote working due to the COVID-19 pandemic, most companies have started relying on cloud-based software instead of traditional ones.
In the present times, any company that fails to provide mobile billing options is bound to lose valuable clients.
The Rise of Real-Time Global Payments
Gone are the days when companies had to wait for days or weeks to send invoices and receive payments. Every business expects real-time transactions these days. The COVID-19 pandemic affected the economy of the entire world, so businesses need their money in real-time.
That is why most companies rely on electronic billing and invoicing processes, as they tend to be faster and more accurate than the manual ways of raising a bill or sending an invoice.
Businesses of every size have started adopting electronic invoicing because they reduce the cost and increase efficiency. As we mentioned before, most countries in Europe and Latin America had already started using electronic invoicing before America. Therefore, to continue business relations with these countries, American companies have to adopt electronic billing and invoicing methods.
Modern billing and invoicing methods have enabled American companies to build better business relationships within the country and the world. With increased productivity, companies can save costs and time.
The present billing and invoicing technologies played a prime role in mitigating the challenges faced during the COVID-19 pandemic. We can expect the technology to progress further and increase productivity while reducing losses.
Payrolls, for a majority of the workforce, acts as a motivational factor. It is only when they get accurate and timely income that they feel inspired to keep putting their best foot forward. After all, it is all about money at the end of the day.
This is what makes it important to effectively process payrolls. Accurate payrolls makes sure that employees are neither getting underpaid nor are they getting anything more than they were expected to receive.
Moreover, effective management is also about handling confidential documentation, ensuring accurate benefits, sorting out reimbursements correctly, and everything else that revolves around the employees income.
So, how exactly do you manage payrolls effectively so that both employees and employers keep happy? Read about the solution below.
Get most out of advanced technology
Thanks to advancements in technology, there are now ample tools and software on the market that have been developed to make business operations a lot easier, even payroll management. Payroll system software was designed specifically to ensure that organisations manage their payrolls effectively.
These tools automate almost every payroll-related task. Not only is this tool reliable to get accurate timings and amounts, but there are variations that come with additional helpful features. These features could include tracking attendance, managing budgets, filing taxes, calculating overtime of employees, tracking employee work hours, and many more.
You can easily find a tool that basically takes care of everything related to the human capital of your organisation. All you need to do is select the tool effectively and with patience and research.
Payroll system software was designed specifically to ensure that organisations manage their payrolls effectively.
Streamline tasks
Organisation is the key to success. The more organised you are, the easier your life will be. When there is chaos, the chance of errors increases.
Thus, make sure you are always working to get more organised at work and in life. Start by reviewing how your current processes are. Learn about all the areas that need improvement.
Once you have these areas, start working on them. Determine the type of pay schedule that will work best for your organisation as well as your employees. If you have distributed hours, identify the best course of action to take care of that.
When you are trying to improve, start by analysing and identifying.
Go paperless
In this world of digitalisation, it is perhaps high time to adapt to more advanced technology. After all, the digital world is the future. There are plenty of benefits that going paperless can bring.
The main benefits include offering an easy and less cluttered way to employees to manage and monitor their finances. When you opt for digital solutions, employees won’t have to stand in line and pick up their checks. This will save time and offer them more hours to focus on more important tasks like achieving their targets.
You can offer a self-service portal where employees can themselves look into their documents and payslips when the need arises.
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Consider outsourcing payroll management
Many find it difficult to delegate tasks. They feel the more they keep the work to themselves, the better and more accurate it will be. That’s completely wrong.
When you have too much on your plate, it is going to be truly difficult for you to focus on even one thing. Neither would you be able to carry out payrolls effectively nor the other tasks in hand. And payrolls need accuracy. Thus, consider outsourcing your payroll management. This will help you retain your employees and keep them productive as they will be getting accurate and timely pays. No delays. This is because the chances of the brands that you will outsource payroll management from will probably already have updated software.
Thus, consider letting go of the burden of manual payrolls and begin storing important documents securely.
Conclusion
The bottom line is that automation and easy life goes hand in hand. If you can find any way to automate your tasks, be it using a digital tool or by outsourcing the management, you should certainly consider doing that. It will give you more time to focus on things that actually matter.
A number of the world’s biggest private equity firms, including Silver Lake Partners LP, Thoma Bravo LP and Blackstone Group Inc, have seen their stakes in software firms greatly devalued following a wide-reaching hack on software provider SolarWinds Corp.
SolarWinds stock has slid 20.8% from last week’s close after reporting on Sunday that suspected Russian hackers had inserted malicious code into software used by the company to carry out updates, allowing the operatives to access sensitive systems undetected.
The “Sunburst” operation, remarkable for its size and sophistication, constitutes the biggest cyberattack against the US government in more than five years. Around 300,000 companies and agencies use systems provided by SolarWinds, with around 18,000 believed to have used compromised versions of its software since the attack began in March.
SolarWinds’ customers include most US Fortune 500 companies, all of the top 10 US telecom providers, the US military and various other government branches. The UK government and the NHS are also listed among the company’s clients.
Silver Lakes holds a stake of nearly 40% in SilverWinds. Following the plunge in the value of its shares, this stake is now worth $2.3 billion, and Thoma Bravo’s 33% stake is now worth $1.9 billion.
Blackstone’s $400 million November donation in cybersecurity firm FireEye Inc also suffered from the hack, as the company’s shares fell 11% after hackers stole a collection of hacking tools used to test clients’ cyber defences. FireEye, which has contracts across the US national security sector and with its allies, uncovered the SolarWinds breach while probing this attack.
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Regulatory filings showed that, following the theft of its tools, FireEye amended its deal with Blackstone and co-investor ClearSky to make it more favourable to the private equity companies. The firm opted to convert the FireEye-preferred shares that the investors stood to receive to common stock at $17.25 rather than the initially agreed $18.
FireEye shares traded at around $13.58 on Tuesday afternoon.
Ride-hailing giant Uber has moved to sell its driverless car research division to self-driving startup Aurora, a significant shift in the company’s plans for future development.
The autonomous driving unit, known as Advanced Technologies Group (ATG), will be sold as part of a reported $4 billion deal which will see Uber investing $400 million in Aurora in return for a 26% stake in the company. The deal will also give Aurora access to Toyota, which has invested in ATG.
Uber CEO Dara Khosrowshahi will also be joining Aurora’s board, and the two companies expect to collaborate in bringing driverless cars to Uber in the coming years.
“Few technologies hold as much promise to improve people’s lives with safe, accessible, and environmentally friendly transportation as self-driving vehicles,” Khosrowshahi said in a statement. “For the last five years, our phenomenal team at ATG has been at the forefront of this effort – and in joining forces with Aurora, they are now in pole position to deliver on that promise even faster.”
Aurora is a Silicon Valley-based startup founded by former Tesla, Uber and Google executives and backed by Amazon and Sequoia Capital. The firm develops sensors and software for autonomous vehicles, with a focus on the commercial trucking sector over automated ride-hailing taxis. It currently employs over 1,200 workers.
The news follows a prediction from Volkswagen CEO Herbert Diess that autonomous vehicles will be ready for the consumer market between 2025 and 2030. In an interview with weekly German magazine Wirtschaftswoche, Diess said that autonomous driving technologies had progressed significantly, with advances in artificial intelligence continuing to accelerate.
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Germany’s Ministry of Transport has already begun to draft legislation to allow driverless vehicles to operate on public roads. Trials of self-driving cars began in the UK in October as part of the government-backed research scheme “Project Endeavour”.
The drive to access the digital economy during the pandemic has been behind much of the disruption in payments this year. COVID-19 has pushed the industry to think fast and contactless payments have emerged as a lifeline for businesses and consumers. Interestingly, a lot of the innovation that is taking centre stage leverages existing technologies, but in new ways to tackle new problems. Most notably, the QR code saw a revival and has become an increasingly popular way of paying for goods and services.
Crucial to the success of the QR code payment is the fact that simply, it’s a technology that is accessible to anyone with a smartphone in their pocket. And this signals a much bigger trend we’ll continue to see during the pandemic and beyond - we don’t need to reinvent the wheel to create disruptive payment solutions. Instead, the most exciting innovations will leverage technologies that are within reach of consumers and businesses. This will be the key to seeing widespread penetration of new payment experiences.
Opening up the digital economy with the smartphone
While much of the contactless payment drive has focused on the ease of access for consumers, it’s not been such an easy ride for businesses. Large swathes of micro and small businesses that were predominantly cash-based have had little choice but to accept contactless payments during the pandemic. But one of the challenges that come with this payment revolution is that contactless point-of-sale (POS) hardware can be costly and complex to maintain for businesses. This can present a financial burden for micro and small businesses that want to access the digital economy and accept contactless payments.
The launch of Visa’s Tap to Phone solution and the comeback of the QR code show what can happen when you keep innovation simple.
The launch of Visa’s Tap to Phone technology in October is a pivotal step towards breaking down this barrier for businesses. And its genius once more comes down to harnessing existing technologies – again, the smartphone - in innovative ways to open up access. Visa Tap to Phone transforms Android smartphones and tablets into contactless POS terminals so sellers can accept contactless payments from their customers.
By removing the need for costly POS hardware and complex maintenance, it is enabling smaller businesses to download an app and accept contactless card or mobile wallet payments within a matter of minutes. The proliferation of mobile means Tap to Phone is well within reach of businesses of all sizes – and the customers they serve. And this is key if we are to see widespread adoption of new payment experiences among businesses.
Visa’s Tap to Phone innovation signals the end of POS and the start of easy access to cashless payments for businesses.
Easing emerging markets into the cashless economy
What works for one market, might not necessarily work elsewhere. In emerging markets, the technology that is accessible to both consumers and businesses can vary and that can dictate what is possible. With many markets around the world still predominantly cash-based, there is also a greater challenge to ease consumers and businesses into cashless payments, in some cases, for the first time. Again, using technologies communities are familiar with and already comfortable using is an important first step to encourage adoption.
If new payment solutions are to see widespread uptick and success in these markets, understanding of local market behaviours will be crucial. It comes down to learning the unique challenges faced by the local community, as well as their attitudes towards cashless payments. Only then can you explore the tools accessible to them to create payment solutions that stick.
Let’s keep it simple to make real change
The launch of Visa’s Tap to Phone solution and the comeback of the QR code show what can happen when you keep innovation simple. These technologies are transforming payment experiences for consumers and business alike around the world. And it’s all powered by the humble smartphone – a device mostly all of us carry in our pocket.
By using the existing technologies around us, we can expect to see increased penetration of new payment solutions. It might have taken the pandemic for some consumers and small businesses to make the leap to contactless payments, but we can expect to see this shift in behaviour take hold, even as we revert back to normal. We’re only seeing the start of the contactless revolution. The payment solutions that are accessible to all will have the power to scale with ease and will see the biggest success. That’s where the real innovation lies.
Stuart Lane, CEO at Trade Nation, shares his findings on the trading habits of millennial and Gen Z investors and how they have been influenced by emerging trading platforms.
There’s been a surge in trading interest among the whole population since the start of the coronavirus pandemic, but especially so in millennials and Gen Zs. A survey by E*Trade Financial Corp found that over half of younger investors have traded more frequently, and while many have made notable gains, there have also been some serious losses.
Roughly 46% of millennials and Gen Zs are trading derivatives more frequently — double the average rate. What’s more, 51% say their risk tolerance has increased. This makes for a potentially dangerous combination, especially for amateurs, of whom there are plenty. Robinhood (by far the most popular trading app of millennials and Gen Zs) has said almost half of its new customers this year are first-time traders who, therefore, may not know the risks surrounding complex derivatives such as CFDs. As Trade Nation notes: “CFD trading certainly isn’t straightforward and there’s a lot of confusing terminology and hidden costs involved too. This means it usually isn’t the best way for traders to kick off their journey.”
And in addition to the risks individual traders may be opening themselves up to, experts like Princeton economist Burton G. Malkiel believe that the outlandish trading activities of millennials and Gen Zs are also wreaking havoc on the financial markets.
Why are young people trading more?
The general consensus is that trading has been a great way for the younger generations to fill extra time and deal with the boredom of lockdown. As the founder of RagingBull, Jeff Bishop, told CNBC: “A lot of people are at home and have got more time on their hands. And many, unfortunately, have lost their jobs and are looking for new opportunities. Younger investors are looking for ways to recoup their money.” Furthermore, many Americans have been able to fund their trading activities with their government stimulus checks, with software and data aggregation company Envestnet Yodlee reporting that trading was among the most common uses for the checks in almost every income bracket.
There’s been a surge in trading interest among the whole population since the start of the coronavirus pandemic, but especially so in millennials and Gen Zs.
Apps like Robinhood, eToro and RagingBull have also made trading more accessible for these traders, seeing demand for their services rise by 300%, 220% and 158% in the first quarter of 2020, respectively. And given that the vast majority of millennials and Gen Zs have been using their smartphones more due to the coronavirus outbreak, it’s unsurprising that the time spent on apps like these has also increased.
What are millennials and Gen Zs trading?
The E*Trade survey found that almost half of young investors are trading derivatives more frequently compared to 22% of the general population, while there’s been an especially sharp increase in options trading. What’s more, the surprising nature of their most popular stock picks have stunned, and perhaps even humbled, many Wall Street investors.
"We see a lot of buying activity of specific industries that were impacted by the pandemic," said Robinhood co-founder Vladimir Tenev, as reported by CNN. He singled out shares of airlines, videoconferencing and streaming media companies, and biopharmaceuticals. For example, even though Warren Buffet dumped his airline shares in light of the coronavirus travel restrictions, millennial and Gen Z traders had faith in a recovery. Frank Holmes, CEO of US Global Investors, told CNN that he noticed a surge in interest for the JETS airline ETF in March. Examining Robinhood trends, he learned that plenty of young investors had been buying it after a major dip. The funds' assets went from $34.6 million at the start of March to $615 million by the end of April — a 1600% increase.
“Although a lot of people may say that it’s crazy, it has turned out pretty well,” JJ Kinahan, the chief market strategist at TD Ameritrade, told Bloomberg. “Retail investors for the last few months have been a little bit ahead of the curve. There’s been a lot more perhaps optimism among retail traders around the turnaround than there has been from professionals. This continues to show that.” However, it’s inconclusive whether moves like this are really paying off for younger traders. While some analysts (such as those at Goldman Sachs) claim the stocks of Robinhood investors have outperformed hedge funds and the indices, others have found a negative correlation between these stocks and their returns.
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What are the potential problems of this?
Empowered but inexperienced traders
Robinhood has been the app of choice for many millennial and Gen Z traders, and though their ambition to “democratise finance for all” has clearly appealed to this market, it also means that many amateurs have jumped into trading without any experience and gone on to make grave mistakes.
“Robinhood has gamified investing. Trading is now so simple that it can be easy to make impulsive decisions,” one millennial investor told Financial Times writer Siddarth Shrikanth, adding that they immensely regretted the progressively riskier trades they had made during lockdown. Shrinkanth noted that while Robinhood doesn’t provide investment advice, it does “little to deter poor decisions”. For example, almost 200,000 users were holding very complex United States Oil ETFs in the days after it crashed in April. “Why were younger investors drawn into volatile commodity tracker funds, despite repeated warnings from regulators that these risky products were unsuitable for retail investors?” he questioned.
Many millennials and Gen Zs are diving into trading complicated financial instruments without fully understanding the risks. And as well as the potential for devastating losses, this can also come at a tragic human cost. Alex Kearns, a 20-year-old Robinhood trader died by suicide after seeing an unexpected $730,000 negative balance on his account, which he didn’t understand and may have only been temporary.
Many millennials and Gen Zs are diving into trading complicated financial instruments without fully understanding the risks.
Volatile markets
In addition to the potential problems for individual millennial and Gen Z traders, it’s also thought that their activities may be having a significant impact on the markets. For example, having filed for bankruptcy in May, Hertz shares had surged 800% just a few weeks later, with this being one of the most popular Robinhood stocks. Stocks like these may be rallying because of the sheer number of users on the platform — there were more than 160,000 Robinhood investors who owned Hertz stock as of 17 June.
That said, not everyone believes millennial and Gen Z traders are responsible for inflated stock prices. “In June, Barclays published a study of moves in the S&P 500 and positions taken by ‘Robinhooders’,” explained The Telegraph’s Garry White. “It concluded that retail investors speculating in stocks are not responsible for the market’s rally and the top picks of the app’s users tended to underperform, and moves in the S&P 500 were independent of the positions taken on these apps.” He also concluded that while many Robinhood users may see big gains, ultimately: “this strategy needs a lot of attention to follow market moves and it seems inevitable that most will eventually lose money”.
Nigel Frith, vice president of financial services at AskTraders, discusses how challenger banks have revolutionised the banking industry and the opportunities more traditional banks can explore as they aim to extend their digital offerings.
As the high street has evolved in order to meet the changing needs of consumers, retailers have been left with no option other than to reinvent themselves. The banking industry certainly hasn’t been immune to these shifting trends either and as a result, over the last few years traditional banks have been forced to adapt and change the way they operate. While their face-to-face services still remain a crucial string to their bow, banks have had to invest heavily in their digital offerings in order to compete with increasingly popular digital-first providers. So, why are these challenger banks such as Monzo and Starling so attractive to customers and how have the big players in the industry risen to this digital challenge?
A focus on challenger banks
With their chic apps and personalised offerings, new banks can’t be found on the high street but are instead on your mobile phone. Their customer-centric approach has simplified banking by providing users with features which make daily tasks that little bit easier. From being able to split the cost of meals with friends to keeping track of monthly outgoings, these app-based services have really hit the spot in the eyes of many.
With more than four million customers, Monzo is perhaps the most well-known challenger bank. It started out in 2015 as a prepaid card that could be topped up via its app before transforming into a sole banking brand in 2017. It offers all of the usual current account services regular banks provide but also enables customers to manage their money in an effective and efficient manner. The ease at which you can navigate through the app is certainly a big draw for digital-savvy youngsters who are able to quickly transfer money to their friends and set monthly budgets.
In recent years it has continued to broaden its services such as by adopting a ‘get paid early’ feature which allows users to be paid their salary or student loan a day early. By embracing a channel-based communication model, Monzo has also been able to respond to incidents such as outages in a typically effective fashion. Customers can report any issues using a chat service on the app and they have the ability to freeze a card from their phone should they lose it.
With their chic apps and personalised offerings, new banks can’t be found on the high street but are instead on your mobile phone.
Another major benefit of banking with Monzo and many of its other app-based competitors is that it doesn’t have any foreign transaction fees for spending. It has therefore become a highly attractive option with regular travellers and holidaymakers alike.
How traditional banks have risen to the challenge
Although recent analysis of bank branch data has revealed that (if the current rate of closures was to be maintained) there would be no high street banks left by April 2032, there is clearly still a demand for in-person banking. Many people still feel more comfortable going into a bank to pay-in cheques while others are reliant on the financial advice they can access in-store. Clearly there remains a need for traditional banks, such as the big four in the UK - Barclays, Lloyds Banking Group, HSBC and RBS - to evolve their offerings.
In recent years, therefore, these banks have invested heavily in their online and mobile banking services in a bid to compete with digital-first providers like Monzo. This has included providing customers with perks such as being able to pay for purchases using virtual cards on their apps and providing them with the ability to cash-in cheques from the comfort of their own homes.
Leading the way has been Barclays who in 2017 invested £4,148 million into their digital platforms. Now, more than 90% of Barclays’ transactions take place over mobile devices, emphasising the effective nature of their transition to a more digitally-focused way of operating. In December 2018, Barclays also designed a feature which allowed customers to turn off payments towards certain websites should they feel they are unable to curb their spending. More recently, it has taken things a step further by enabling users to view the accounts they hold with rival banks on their platforms - an option which would have been unthinkable a decade ago.
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Key to ensuring customers have felt comfortable transitioning to these digital services has been the commitment banks have shown towards tackling cyber crime. This has seen the banking industry team up with the government, police and other regulators in recent years. Initiatives have been set up to not only raise awareness of the threat scammers pose but to also reassure customers of the stringent measures banks have in place to protect their personal data. Last year, UK banking security systems prevented fraud on an estimated £1.4 billion scale, demonstrating the importance of their investment into tackling cyber crime.
The future
With banks now constantly innovating in a bid to steal a march on their competitors, it is likely we’ll continue to see big changes taking place within the industry over the coming years. One thing that is clear though is that there will be a continued drive by providers to further improve and simplify the customer experience. Although further high street branch closures are inevitable, banks are working hard to maintain their in-person services for those who prefer to operate in this capacity also. While digital banking isn’t for everyone, the ease and efficiency at which millions of people can now complete financial tasks has left a lasting impression on many.
Simon Shaw, Head of Financial Services and Insurance at Software AG, outlines three ways in which larger banks can – and must – make their business models more agile.
In the months since COVID-19 reared its ugly head and changed the way we live, there has been a noticeable uptick in conversations around digital transformation and embedding resilience. In the banking sector, the focus had been on the increased demand for online banking and questions around how banking monoliths will adapt.
The reality is that big banks can adapt – albeit slower than other industries. That’s not to say that change isn’t happening; banks have been transforming for years to align with changing customer needs. However, it’s a distinctly difficult and complex challenge. In fact, one of the primary challenges with digitalisation in banking is that moving quickly doesn’t happen easily. Of course, CFOs and financial leaders would love to quickly pivot their operations to meet changing needs and new requirements, but in their current state, most incumbent banks don’t yet have that capacity.
To achieve digitalisation, banks are grappling with many moving parts. From regulatory requirements, to safeguarding customer data, to overcoming silos – and that’s before we consider the sheer cost of it all. I have identified three ways for established banks to pivot more quickly and efficiently in today’s climate.
1. Go Hybrid or Go Home
A significant challenge in the digitalisation of big banks is that their ecosystems simply weren’t designed to enable quick transformation. Changes that may seem simple, or are simple in other sectors, can require full programme rewrites when applied in banking. The legacy systems on which most large banks are built are clunky and inflexible. Since these systems don’t run in real-time, they’ll never compete with the efficiency and analytic capabilities of challenger banks. Yet, despite that, these established systems actually hold the key to future success in banking – data.
The wealth of data contained within a heritage system has the potential to entirely transform the customer experience. However, to do so, banks must be able to access and integrate that data at speed.
A significant challenge in the digitalisation of big banks is that their ecosystems simply weren’t designed to enable quick transformation.
Hybrid cloud presents the best of both worlds; it combines the operational stability of on-premise solutions with the scalability, reduced cost and data accessibility of the cloud. Breaking up isn’t easy but, according to IBM, banks that are outperforming their competitors are 88% more likely to have incorporated hybrid cloud into their business model. For banks with decades of data in monolithic technology stacks, turning certain data and tasks over to the cloud can significantly lighten the load on their ecosystem to improve efficiencies.
2. Visualising Opportunities for Change
Digital transformation has changed banking expectations. Customers want speed and convenience and banks are competing to deliver. Excellence requires efficiency, but that can be difficult to achieve.
Process mining identifies optimisation opportunities and strives for excellence in process performance. As the name suggests, process mining delves into the detail of what occurs as a process is actioned, revealing patterns, anomalies and the root causes for inefficiencies. With greater insight into processes, banks are able to make informed decisions and tangible improvements to quality and performance. To compete with the challengers, established banks need to embed the ability to adapt to changing business requirements and make transformation routine. The first step to this is visualisation.
If hybrid cloud is the vehicle by which digitalisation is achieved, process mining is the check engine light.
3. The Building Blocks of Better Banking
One of the biggest challenges to transformation lies in evolving away from heritage applications. Transitioning from old to new is daunting and can come with a hefty price tag. Microservices enable banks to transform piece by piece and scale at a controlled rate.
Transformation in data-reliant and regulation-heavy sectors will never be a walk in a park, however, microservices start small by design. This returns much needed control to banks and ensures complex changes are developed and tested independently before being integrated into the banking ecosystem.
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To fundamentally change business operations, the very foundations of that organisation need to be redesigned. This applies across industry, which is why, between 2018 and 2023, the microservices market is predicted to nearly triple as more organisations shift their transformation up a gear.
Microservices embed agility and efficiency from the outset, making digitalisation a cultural and technological change. By returning control and enabling a customer-centric and scalable design, transformation can add big value to big banks.
Agility is essential, but moving a monolith isn’t easy
In banking, where archaic systems and rigidity have been governing organisational change for years, digital transformation really means reinvention and growth. While the end-goal is easily defined – agility, resilience, scalability, digitalisation, etc. – it’s difficult to know what’s needed to achieve it. When the dependencies, regulatory requirements and price of change are thrown into the mix, it’s no wonder that change takes time in the financial sector.
Hybrid cloud, process mining and microservices create the foundations for development by embedding transformation capabilities into the very core of a banks system. While financial institutes will always be subject to a high level of scrutiny, strategic solutions that bring order, visibility and an ability to compete with smaller and more agile banks are truly transformative.
The outgoing Trump administration has unveiled an executive order banning US investment in Chinese firms that it says are owned or controlled by the Chinese military, adding further economic pressure on Beijing.
The order has the potential to impact some of the largest Chinese companies, including telecom companies China Mobile Ltd, China Telecom Ltd and surveillance equipment producer Hikvision.
From 11 January 2021, the order will prohibit US investment firms and pension funds from purchasing the securities of 31 Chinese companies that the Defense Department identified as backed by the People’s Liberation Army earlier this year. However, transactions made for the purpose of divesting ownership in these companies will be permitted until 11 November 2021.
“China is increasingly exploiting United States capital to resource and to enable the development and modernisation of its military, intelligence, and other security apparatuses,” the order said.
It is not yet clear how much impact the order will have. The affected companies do not appear to include publicly traded Chinese tech giants, while several other tech firms (including Huawei) do not trade on the stock market. Some of the firms said to be affected are state-owned companies with no foreign stockholders, such as China Electronics Technology Group, though others – such as CRRC Corp – do have foreign investors.
According to investment strategist Andy Rothman of fund manager Matthews Asia, US investors own around 2% of the value of the companies traded on the Chinese stock market, meaning that the order is unlikely to be greatly consequential to the Chinese economy.
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As the order allows ownership in the listed companies to be retained until 11 November, there is a significant possibility of the incoming Biden administration rescinding the order before it can affect US shareholders.
ByteDance, the Beijing-headquartered owner of TikTok, is set to meet its advertising revenue goal for the year, which will place it firmly as the second-largest giant in China’s digital advertising market.
According to Reuters, the tech company is on track to make at least 180 billion yuan (or $27.2 billion) in annual advertising revenue, making up the bulk of its $30 billion revenue goal for 2020. In terms of ad revenue, it is beaten only by Alibaba.
Though TikTok is ByteDance’s flagship product internationally, the social media app contributes little to its parent company’s overall cashflow. Of ByteDance’s ad revenue, nearly 60% comes from Douyin, the Chinese version of TikTok. A further 20% comes from ByteDance’s news aggregator Jinri Toutiao, and less than 3% from its long-form video platform Xigua.
These final numbers will be adjusted by the end of the year, as many of the company’s most important campaigns – including year-end sales – have not yet been officially launched.
ByteDance continues to struggle with an order from the Trump administration ordering it to divest its US operations of TikTok by this Thursday. While a deal between ByteDance and Oracle appears to have been settled, the company lodged a petition with a US Appeals Court late on Tuesday challenging the administration’s order and seeking an extension to the deadline.
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Outside of TikTok, ByteDance is looking to other avenues of growth, with plans to invest 10 billion on its Xigua platform next year. The company intends to increase Xigua’s count of daily active users to over 100 million, while its Douin eCommerce platform is expected to reach roughly 150 billion in gross merchandise value by the year’s end.
Tenable's Adam Palmer, Chief Cybersecurity Strategist, and John Salomon, FS-ISAC Director, Continental EU, Middle East, & Africa, explain the benefits of CFOs and other executives involving cybersecurity in their roles.
A commissioned study conducted by Forrester Consulting, on behalf of Tenable, found that currently only four in ten UK business leaders can confidently answer the question, “How secure are we?” There is a disconnect between business leaders, financial teams and security leaders in how they manage and communicate cyber risk. As such, cybersecurity needs to evolve as a part of the business strategy.
The Cybersecurity “Communication Gap”
Most mature businesses understand how to perform a basic assessment of the wide range of risks that impact their organisation. Cyber risk is often the exception. Cyber risk management is well established. However, business leaders, such as CFOs, don’t usually “speak” security, and techies don’t often know how to quantitatively measure, or explain, the degree of exposure to cybersecurity threats in a business context. As a result, the link between cybersecurity and the business can be lost in translation. Security is often seen solely as a cost to the business, rather than a means of preventing losses, or even a driver for increased revenue and overall success. Aligning the security programme to financial objectives improves understanding of value and drives support for corporate policies that support effective cyber risk management.
Cybersecurity Awareness – a Two-Way Street
Responsibility for ensuring effective cybersecurity risk management does not belong entirely to the CISO. Success depends on the rest of the organisation making an effort to also understand cybersecurity risk. This is not to say that a CFO must be a cybersecurity expert, as the onus is on the CISO to “speak the language of business.” Rather that financial leaders should at least have a fundamental grasp of cybersecurity. Using car ownership as an analogy, a driver does not have to know how to assemble an internal combustion engine. It is reasonable, though, to expect a competent driver to understand how to change a flat tire, check the oil level, and most crucially, when to listen to a professional mechanic.
Responsibility for ensuring effective cybersecurity risk management does not belong entirely to the CISO.
Most importantly, the infosec organisation must not be seen as a necessary evil. Rather than treating the CISO and their team as expensive alarmists, a CFO must make an effort to comprehend some of the basic concepts of cybersecurity, and the ramifications to the organisation’s finances of not having a capable, empowered security organisation. Furthermore, the cybersecurity organisation can only do its job effectively if their security risk assessment activities are backed by unambiguous, strong policies.
Seeking Clear Answers from the Security Team
The CISO must distil the highly complex topic of cybersecurity into concise, relevant messages without “dumbing it down” for business and finance leaders. While the CISO should present a measurable view of the organisation’s cyber risk exposure using internal and external comparative benchmarks, the CFO should ensure they understand the basics around:
- Where are we exposed?
- Where should we prioritise based on risk?
- How are we reducing our exposure over time?
Describing the target state of the security programme should be based on an understanding of risk, not blindly applying capability maturity levels. Organisations need the ability to identify and quantify their level of risk and exposure. This should be done in collaboration with the C-Suite. Cross-functional collaboration will turn the organisation’s security strategy into a “living” strategy, and ensures business alignment on priorities, costs, and needs.
Is compliance the end goal?
Many organisations will look to regulatory standards to determine their cybersecurity goals or “target state.” While there is value in meeting these baseline requirements, checking a box doesn’t necessarily equate to appropriate secure practices or addressing financial risk. Minimum, compliance-based security is not adequate security. Instead, organisations should work to really understand their critical assets, identify the vulnerabilities that affect them and create a security programme that addresses this.
By adopting a quantifiable approach to security that benchmarks internally and externally, and is aligned to business and finance objectives, it becomes much easier to define a target risk state and measure overall effectiveness. This also allows a firm to get a head start on meeting their regulatory requirements and improving communication with regulators.
CFOs need to work with CISOs in order to gain an understanding of their company’s security risk including the financial costs associated with it - both from a risk perspective, but also where technology investment might be needed. While finance can’t be expected to understand the technology or how it works, it is important to understand why it matters, including the role each new investment plays in closing the cyber exposure gap. To provide the level of detail needed to determine and reduce risks, the CISO needs to be able to determine, understand and report the following information to senior management:
- See: Complete visualisation of the entire modern attack surface allows anyone, from analyst to executive, to quickly understand and explore the organisation’s risk profile. This helps underpin the reasoning for taking action
- Predict - Advanced analysis and risk-based exposure scoring that weighs asset value and criticality, against vulnerabilities with threat context. This provides clear guidance of what to focus on first.
- Act - Exposure quantification and benchmarking enables effective comparisons of internal operations, and also allows this to be tracked against peers. This identifies areas of focus and suggests actions needed to optimise security investments.
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Stronger together
Historically, cybersecurity initiatives are seldom aligned with business and finance objectives, but that must change.
Security leaders are challenged to prioritise where they focus effort — not just when it comes to vulnerabilities, but their entire cybersecurity strategy in general. By placing cyber risk management as part of an overall risk framework, business and financial executives can more easily assess whether best practices are being implemented effectively.
To do this, the CFO must work with the CISO to align cost, performance, and risk reduction objectives with business needs. This means providing a holistic understanding and assessment of the entire attack surface, with good visibility into the security of the most business-critical assets. The CFO should seek defined metrics and benchmarking processes, tied to business performance and process improvement from the CISO. Adopting this transparent, quantifiable approach will help the business understand cyber risk clearly, predict new threats, and act effectively.
The result is business-aligned security leaders that ensure their strategies are in lockstep with financial priorities. This collaboration with the CFO not only develops effective strategies and communicable metrics, but actually works to support organisational goals.
US automaker General Motors plans to hire 3,000 new employees to strengthen its engineering, design and IT divisions, the company announced on Monday.
The hiring is expected to take place from now through to the first quarter of 2021 and will be largely focused on software development. GM’s stated aim for the hiring drive is “to increase diversity and inclusion and contribute to GM’s EV and customer experience priorities.” The company also said that it plans to include more opportunities for remote work.
“As we evolve and grow our software expertise and services, it’s important that we continue to recruit and add diverse talent,” said GM President Mark Reuss in the release. "This will clearly show that we’re committed to further developing the software we need to lead in EVs, enhance the customer experience and become a software expertise-driven workforce."
Ken Morris, GM Vice President of Autonomous and Electric Vehicles Programs, said in a call with reporters on Monday that GM has accelerated the development of at least two upcoming electric vehicles following the debut of its GMC Hummer EV, which debuted in October.
“We’re moving as fast as we can in terms of developing vehicles virtually, more so than we ever have by far,” Morris said, adding: “We are doing things virtually, more effective than we ever have.”
Earlier this year, GM said that it planned to invest $20 billion in its new generation of electric and autonomous vehicles by 2025.
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Shares in GM reached $39.72 ahead of the announcement on Monday, a 52-week high. The stock rose 5% in early Monday trading following investor optimism over a promising COVID-19 vaccine and President-elect Joe Biden’s supportive policies on electric vehicle development.
