Why Digital Skills should be top of the class in today’s schools

What will the jobs market be like in 5 years’ time (or even in 1 years’ time) – given the rapid changes that are going on right now?

Robotics and Intelligent Automation are becoming mainstream, chatbots and avatars are taking over call centres and new fintech banks such as Monzo and Starling are turning the traditional banking market on its head.  People of all ages will have to start acquiring new skills and approaches to working if they want an interesting, sustainable and well-paid job.

It’s a fact that digital is transforming the jobs market.  People with digital skills and knowledge are in high demand and are commanding high salaries.  Data is the major differentiator – and understanding how to gain insight from the increasingly huge volumes of data that we are all generating is crucial to every business right now.  Universities and many Financial Services organisations have already started investing in digital and data.  There are a plethora of courses and training available – but until recently – digital wasn’t really taught in schools – leaving young people who didn’t choose (or couldn’t afford) to go to university woefully under skilled and unprepared for the new reality of employment in today’s demanding jobs market.

The first Digital School of Excellence

That’s why it’s great to see Newbattle High School in Midlothian launching the first Scottish-based Digital School of Excellence.  As well as teaching digital skills, Newbattle will be one of the first schools to also include Data Science as a core part of its curriculum. The Scottish Government, Edinburgh University’s School of Informatics as well as local businesses like Sopra Steria are investing in this landmark Digital School as they know it’s the only way to get the right ‘talent’ and skills into the jobs market.  The school doesn’t just teach digital and data skills – it also encourages its pupils to be entrepreneurial, to challenge the status quo and to understand the creation process of great products as well as instilling the right skills and techniques to ‘sell’ their ideas to a sceptical and highly demanding audience.

The Unified Schools Programme

In Scotland, the financial services industry is working on its ‘Unified Schools Programme’ under the leadership of Scottish Financial Enterprise (SFE) and led by HSBC’s Colin Halpin. It’s an exciting project with a joint message about why financial services is an exciting, progressive and diverse industry to work in. The programme is focused on promoting the sector as THE digitally focused and customer centric place to be for young people, highlighting the advantages a career in digital can offer.

An SFE pilot project involving Newbattle High School and Queensferry High School kicked off in November 2018 to give young people opportunities to experience financial services through short placements. SFE members and Skills Development Scotland are fully supporting the initiative.  Why?  Big business knows it needs fresh talent and realises it needs to promote the financial services industry as a great place to work, highlighting the multiple opportunities that the sector can deliver if it’s to get the creative and talented people it needs to be future ready. There really is a job for everyone in financial services – and for young people with a positive attitude, creativity, enthusiasm and focus, it can be a fantastic first step into the world of work.

I used to be concerned for today’s young people facing an uncertain future in a demanding jobs market.  Now I can see exciting new career opportunities where the education system, with support from government and industry helps the next generation to think differently, to be brave and to create ideas that will shape our future.  Scotland is setting the pace for change – the question is – when will the rest of the UK catch up and put digital skills top of the agenda?

Financial Inclusion, Digital Inclusion and Tech Displacement

In 1999 I worked at a major High Street Bank with the teams who developed Mobile Banking Via SMS  Who would have thought that as a consequence to us thinking, ‘wouldn’t it be cool to get you balance on your mobile phone’ that it would contribute to the decline of the High Street? From getting your balance by text on a Nokia 3310, fast forward 20 years to the Banks opening up more and more services to their customers via the Smart Phone Apps that we all use on a daily basis. This combined with Telephone Banking has led to reduced branch usage and therefore Branch closure. At the end of 2017 in the UK there are about 9500 bank branches a reduction of about 600 on 2016 with about 500 to close in 2019.

Branch closure then has a knock on affect to Small Businesses. A small Business can not afford to close their doors for an hour round trip to their nearest branch. Which means that Businesses may choose another location. In a report for Scottish Government , by mapping bank branch closures against postcode lending data, it found that bank lending to small firms fell by 63 per cent on average in postcodes that lose a bank branch. This figure grows to 104 per cent for postcodes that lose the last bank in town. “On average, postcodes that lose their last bank in town receive almost £1.6 million less lending over the course of a year,” the report concluded.

Where Banks have left the High Street, Communities feel Financially Isolated, It causes major concern for Small Business and people who are Digitally Excluded i.e. those with Little to No Access to Technology and therefore have to travel to a Bank. Within affected communities there is strong feeling that banking should be viewed as a basic part of the local infrastructure and therefore should be available as standard provision.

Add to the Banks shutting down

  • 75% of rural and 10 % of urban areas do not have satisfactory broadband
  • 9 million adults in the UK have never used the internet
  • 1 million adults living in social housing that are offline
  • 27% of disabled adults (3.3 million) had never used the internet

Offline households are missing out on estimated savings of £560 per year from shopping and paying bills online.

Cash: is still the second most popular payment method,(just behind debit cards) accounting for 34% of all payments last year. Around 2.2 million customers mainly used cash for their day-to-day shopping in 2017, although nine out of 10 of them had a debit card they could use, but cash is still an important part of their daily spend preferred by many.

Combine Branch Closure with Cash machines disappearing at a rate of 300 a month, with rural areas hardest hit. As Link ATM Network has lowered the fees it charges to Banks and Building Societies. experts are warning that it could mean closures of free-to-use ATM machines across Britain if they become unprofitable to run, leaving access to cash for millions of people in doubt.  There are 957 areas in the UK with at least 500k customer dependant upon benefits whose cash machine is more than 1km away. The Customers who use “pay for” Cash Machines, regularly incur charges of between £3.70 and £9.25 a week.

Potential closures of Bank Branches and Free Cash Machines risk leaving whole communities without access to cash, harming over two million people who are dependent on cash for their day-to-day shopping.

The Financial Services gap is widening between the Technical Haves and Have Nots – Digital Exclusion. In addition to High Street Closures, the latest Regulations of PSD2 (Payment Services Directive 2) leading to Open Banking in the UK,  allows regulated 3rd parties to access your Bank Account data to deliver a regulated service if you have provided consent to do so. The services currently being provided using Open Banking protocols are for example Comparison Engines, Personal Financial Management apps which can determine trends in your spending habits, or Apps to identify personalised offers. These latest Apps and Services are obviously not available to those who don’t have access to Tech.

As a society we need a way to ensure that advances in Technology and changes to the High Street, do not exclude people from the latest innovation in Financial services.  How do we as an industry ensure the poorest in our society, those that don’t have tech or can’t afford tech, can access the range of comparison engines to get cheaper deals, can take advantage of Digital Payment options to gain discount, and find the best deals, that are readily available to the rest of us? Do the Tech and Financial world have an obligation to provide the tools to ensure accessibility for all and if so how do we work together to ensure Financial Inclusion?

As a footnote, I’m currently Working with a Consultation group in Manchester to define Tech Displacement and how you assess the disruption of your Innovation on People and Places and we are looking to develop  a toolset to evaluate. We are at the start of the this consultation period, so please follow me on Twitter to find out how we progress or maybe to trial our toolset for us. @NJMarham


 

References:

https://www.cdrc.ac.uk/case-study/measuring-the-impact-of-online-shopping-on-high-streets-across-england

http://www.parliament.scot/S5_EconomyJobsFairWork/Inquiries/BC025-SFE.pdf

http://www.parliament.scot/parliamentarybusiness/CurrentCommittees/108241.aspx

Fintech Bites!

On the 19th of September we had our first ‘Fintech Bites’ meetup, hosted at the premises of The IDco, a great new Fintech and Sopra Steria partner that focuses on Open Banking. The main theme was Digital Identities in Financial and Public Sectors. This was a soft launch event, with over 30 Financial Services professionals in attendance, including a number of representatives responsible for Fintech and Innovation from RBS, Lloyds and HSBCFintechThe evening commenced with myself, Sopra Steria Consultant Taz Juozokas, introducing the meetup story and what we have in store for it in future. This was followed by UK Fintech Director Colin Carmichael talking about the Fintech Scotland ecosystem and what the key roles of each of the partners in Scotland are (Sopra Steria was announced as a Fintech Scotland partner in June 2018 with Managing Director of UK Consulting Melba Foggo on the Board of Executives).

The IDco were next to speak, with Digital & Open Banking Expert Andrew Garden and Digital Marketing Specialist Jimmy McLellan providing some great insight into their offerings.

Andrew gave a short overview of the interesting work The IDco has been doing in the digital identity space, as well as their future plans for KYC and AML automation for the Financial Services sector. He also showed us a demo of NoMo – a new digital finance management app. NoMo allows the customer to understand how well they are doing with finances and recommends spending based on this. It also does payment aggregation and alerts with personalised messages. You can test the private, beta version here.

Sopra Steria tech partner Wallet.Services closed the event, with speakers including Chairman Rab Campbell and CEO Stuart Fraser.

Rab covered the concept of blockchain and the work Wallet.Services have been doing with the Sopra Steria public sector. The audience was thrilled to learn about zero knowledge authentication enabled via distributed ledger technology. He also talked about their projects for Oil and Gas companies in Aberdeen, as well as the innovative work they have been doing with Citylets and partners regarding the safe sharing of rental information across the lettings market.

Wallet.Services created a digital identity on blockchain, which allows the registering of housing tenants rent payments in order to build their credit history.

The event has received great feedback from the audience and some interesting discussions were had afterwards. I would like to thank everyone who attended the event and showed an interest. Look out for more to come across the UK!

Regulation and compliance: the new certainties in life

by Miles Elliott, Director of Credit Risk

Benjamin Franklin once wrote that ‘in this world nothing can be said to be certain except death and taxes’. But in these more modern times, especially for financial services organisations – we should perhaps add ‘regulation and compliance’ to the list. In 2018, a wave of new regulation is being introduced – and one of the most far reaching is the General Data Protection Regulation (GDPR).

GDPR: are you ready…?

From 25 May 2018, organisations across Europe will have to strengthen controls associated with collecting, managing and using personal data. Resulting activity will see significant changes to IT systems as well as the way organisations engage with their customers.

There’s less than a year to go until GDPR becomes a way of life, but a survey in May 2017 suggested that only 10% of organisations have mature GDPR plans in place – with a further 40% at an intermediate phase.

That leaves half of organisations at the beginning of their compliance journey – and the clock is ticking!

GDPR: the cost of non-compliance…

Becoming fully GDPR compliant will be challenging and will require a holistic approach to data management and governance. Organisations run the risk of failing to respond to the scope of activity involved and the amount of time needed to ensure compliance. Another common issue is the lack of skills and experience to deliver such a comprehensive change to governance controls across a business. To put this into context, in 2016 alone there were 1.4 billion data breaches across the industry.

Fines for failing to comply with GDPR are expected to be highly penal as well as leading to material reputational damage.

Don’t go it alone – work with an expert in assured compliance

So what should today’s hard-pressed organisations do, especially if they don’t understand the full extent of GDPR?  The answer is to work with an organisation like Sopra Steria that’s got a track record in complex data management AND offers a ‘comprehensive’ approach to GDPR compliance. Our pragmatic ‘think, build and run’ approach empowers organisations to pick and choose the path to GDPR compliance that is right for them. As experts in Data, Analytics and Technology, we can help you quickly identify data gaps and risks, work with you to develop remediation solutions and support you moving forward with on-going compliance monitoring.

The clock is ticking…

So don’t get caught out! Make sure you aren’t one of the 50% of companies still asking “What is this GDPR”?  Take your first steps today to GDPR compliance and get fully prepared for the 2018 deadline. Remember, 2018 is the year of new regulation – make sure it’s a happy one!

See more information about how we can help you get compliant.

Get in touch to discuss how to meet your GDPR challenge and support your journey to assured compliance.

New banking… new thinking

They say money talks.  Well in the world of banking, that is often true.  But now, new entrant and challenger banks can breathe a sigh of relief.

Know your customer. It’s the oldest adage in the world but still the most valuable. But understanding the needs, wants, expectations and behaviours of today’s highly demanding and digital customers is tricky for all organisations – and most especially banks.

Banking has transformed (and then some!) in the last 10 years. In the past, banks designed services and customers took what was available. Inertia ruled – and customers largely stayed loyal. Now all that’s changed. New, exciting, personalised banking services are constantly emerging – and the bank that truly understands what different types of customers want and need now and in the future gets ahead and stays ahead. Standing still is not an option! The message is clear; if banks don’t provide the services, security, flexibility and innovation that its customers want and need – they will vote ‘with their feet’ and move to another bank that does. Simples!

But understanding complex customer behaviours, financial requirements and market developments requires highly sophisticated and often complex analysis. It’s a fact that there are some great analytics solutions on the market but until recently, these were incredibly expensive and beyond the reach of all but established banks or ‘well heeled’ new entrants. This put new banks at a disadvantage and hampered them from designing new, responsive, highly personalised solutions. But now that’s changed.

From today, advanced highly sophisticated analytic capabilities will be within the reach of ALL banks.

How? Sopra Steria, a European pioneer in digital transformation, has just announced that it has become a SAS Managed Analytics Services Provider (MASP). This will enable us to offer cutting edge, high-end analytic solutions at a cost effective price point for new entrant banks.

We will include ‘Gold level’ SAS cloud-based analytics solutions as part of our Modular Digital Banking (MDB) solution. This innovative end-to-end, fully functional digital banking solution delivers a ‘step change’ in banking service analytics capability, enabling new entrants to increase their agility and responsiveness.  Key features include:

  • A real time decision engine with integrated marketing automation and advanced analytics
  • Advanced visual analytics capability to create descriptive and predictive models
  • Enterprise grade development environment to ensure organisations can meet regulatory compliance requirements both now and in the future
  • Data modelling as well as data integration, quality and management capabilities

Interested?  Take a look at the Sopra Steria and SAS strategic partnership and find out more about affordable, advanced and innovative analytics that can help you make better decisions faster.

What are your thoughts? Leave a reply below, or contact me by email.

Single View of a Customer: are financial institutions still seeing double?

So is Single View of a Customer (SVoC) or Single Customer View (SCV) new?

Single view seems to have made its debut as part of the Deposit Guarantee Schemes Directive (DGSD) (December 2010) to ensure that compensation can be paid out quickly in the event of a Bank default. But Single View Of a Customer must surely have been in existence prior to 2010 or before the new entrant and challenger banks started to emerge…

Challenger banks and new entrants are fighting for those last remaining USPs that will galvanise customers into switching from their current provider at a faster rate than the 802,036 customers who switched during the first nine months of 2016 (source: BACS CASS dashboard 20 October 2016).

But these USPs need to be underpinned by systems, solutions and the latest FinTech, often from multiple providers, to deliver both a dream service to customers and the rewards the new entrants and their investors are looking for.

The shopping list of components grows and once the new entrant has a full basket and has gone through the checkout, they need to complete the task of plumbing all of these components together to create that seamless customer journey to (and beyond) customer satisfaction.

These shopping list items have often originated from multiple providers, from those on robust platforms with many years of implementation experience, through to the latest and greatest on the most leading (and sometimes bleeding) edge technology.

Will they talk to each other? Do they want to talk to each other and can we expect them to work together? “Who’s the Daddy…?” becomes the issue: which one single component will step up to the plate to orchestrate the other components, what to do and when to do it, all whilst delivering 24×7 availability?

It all boils down to how that Single View of a Customer is delivered: if each component operates in its own little world and creates a customer profile and footprint that is stored in that little world, then how is this information shared, analysed and used to provide an enhanced customer experience? In such a scenario, there seems little chance of creating the bigger picture and instead we continue with lots of small, single dimensional views of the customer.

Both the Customer Relationship Management system (CRM) and the Core Banking host have big parts to play in solving this dilemma, but that still leaves us with two primary candidates vying for the key role of providing the Single View of the Customer. The Core Banking host clearly has its role to play in storing financial information and in maintaining the lifecycle of the account. Likewise, the CRM looks after customer interaction – but it is also looking after prospects before they mature into customers, an area which may not be covered by the Core Banking host.

Let’s use the scenario of customer complaints to help us understand the answer. The complaint may be about an interaction that has taken place, what was said or perhaps what was not said to the customer. The catalyst for what turns into a complaint may have been an interaction which can be traced back through the CRM.  However, the counter-argument from the Core Banking host side might be that the complaint could be down to an issue with the lifecycle of the product, a payment problem, a fee charged or the amount of interest paid. This analysis from the FCA shows that complaints can arise from a number of areas within a bank:

pie chart: 60% Advising, selling, arranging; 26% general admin/customer service; 11% T&Cs; 1% Arrears related; 2% Other

(Source: Financial Conduct Authority – March 2016)

So who has the edge over the other components on the single view at this stage? It has to be the CRM, doesn’t it? After all, it manages the interactions and holds the non-financial view. However, we have to guide the CRM, as it is not a single ‘fix-all’ on its own: we need to consider the number of external service providers, how they are working together and whether they are using standard communication platforms and methods not only to output information but also to receive fresh inbound data. This leads to a parent-child relationship, where the CRM (and that’s a unified CRM platform) is the parent and all of the other service provider components need to abide by the standards and toe the line.

The CRM needs to be fed information that is accurate and consistent in real-time (or as near as it gets). It needs to be able to know when customer interactions take place, what was the nature of the enquiry and who is handling it. If further interactions arrive, who is available to manage these, as there is little point in routing to already busy agents or distributing multiple interactions for the same customer to different agents. A customer interaction routed to a customer advisor they have previously spoken to or one that has dealt with their case in the past should increase the level of customer satisfaction by at least a couple of points.

So, by first accepting that customer delight and attraction may require some complexity within the solution design, an SVoC solution should:

  • start from the CRM host and build out
  • maintain clear flows of data where the latest data set resides in the CRM
  • use common communication methods
  • rationalise the number of external service providers to maintain a single focused view

But the main message here is – don’t underestimate the potential complexity and critical importance of creating your information and single customer view strategy at the start of your journey, especially where there are multiple service providers involved.  Putting off your SVoC strategy until later can leave you with a siloed, inefficient and costly environment to manage………

What do you think? Leave a reply below or contact me by email.

Always-on, always prepared: the cyber security questions Financial Services organisations need to ask

Financial institutions continue to grapple with the ever increasing complexities of cyber security. As online services across all channels grow, so does the security risk. The underlying questions are – how do organisations modernise the legacy platforms that were not designed for the open, connected world of today’s demanding consumer base, and provide the services and interfaces in a secure manner?

The continual growth and competitiveness in digital services continues to disrupt the market. Whether they like it or not, financial firms and their customers will always be seen as targets and those that take this lightly, or avoid the gravitational pull of online services due to security concerns, will be left behind.

That being said, many organisations are trying to put the right protection in place. The key responses to any security incident are monitoring, reacting and remediating. We have seen from recent breaches that the way that a financial institution reacts and addresses its customers that have been affected can make all the difference. Admitting that a security breach has happened is never easy but your customers are more likely to stay loyal to your brand if you openly discuss the security breach, what information or even money was taken and the remedial activities that you are promptly taking.

Open Banking is getting closer – are you ready?

This August, the Competition and Markets Authority published the final report on its retail banking market investigation. By requiring banks to implement Open Banking by 2018, it has reinforced the UK’s transition to a transformed banking landscape based upon a foundation of Open Banking. While certainly a positive step, Open Banking raises more questions around security. Financial institutions need to look at the security around their APIs, covering both internal and external protection layers – what data is exposed through the APIs, and who may be calling the API? In moving to this new world, what competencies in the organisation exist to create and test these new services? The IT organisation that was designed around creation of services for a customer must now address service management and governance of an estate that exists in a digital always-on connected ecosystem of consumer and business relationships.

Data and information are new focal points for the industry, and this is being highlighted by the new General Data Protection Regulation (GDPR) which will be introduced in 2018. The days have gone where we have one, two or three front doors. We now have multiple connections in and out of networks with services being hosted in cloud, hybrid and SaaS services.

Do you know where your information assets sit – especially your most critical and vital assets?

General Data Protection Regulation – honesty and openness

Looking to 2017 and 2018, notification of breaches will look quite different for a large number of financial institutions. Unlike the directive in the Data Protection Act which was silent on the issue of data breach, GDPR contains a definition of “personal data breach,” and notification requirements to both the supervisory authority and affected data subjects.

This notification to the authority must “at least”:

  1. Describe the nature of the personal data breach, including the number and categories of data subjects and personal data records affected;
  2. Provide the data protection officer’s contact information
  3. Describe the likely consequences of the personal data breach
  4. Describe how the controller proposes to address the breach, including any mitigation efforts.If not all information is available at once, it may be provided in phases.

The last sentence will undoubtedly give some pause for consideration and needs to be thought through. Whilst being open and honest with customers following a breach is essential, how much information is satisfactory to release, and under what circumstances should some information be held until the precise nature of method and impact is understood?

We find ourselves in an information conundrum. We know that open and honesty following a breach are important, but that full clarity on a situation is not always instantly available. Security breaches can take place and it can take time before a complete story is put together – but the longer it takes, the greater the concerns from customers that a security breach is not being effectively managed. It’s why it is essential to prepare in advance and have processes in place in the event of a breach. Testing of these plans and creating play books of certain scenarios is something a lot of organisations are doing.

Criminals work at Christmas

Financial organisations have had to adjust to the requirements of their customers who want services online 24/7. We have seen high street financial institutions opening at weekends, evenings and even Sundays. The world of internet banking allows customers to access financial systems all day, every day.

On the other side of the coin, cyber criminals don’t mind at working weekends, holidays or Christmas Day. An organisation’s incident plan needs to be able to react to whatever, whenever, and in a way that is adequate to develop one or a number of alternative approaches. The Security Operations Centre (SOC) needs to be sufficiently resourced with access to on-call technical expertise, and they in turn need to be able to have access to evidence and activities.

Most people feel confident that their SOC is 24/7 – but it goes further than this. Imagine that you have had a breach on Christmas Day. Can you pull together a legal representative, someone who can talk to the press, the CEO and other important members of staff within your organisation?

We all have business continuity plans and disaster recovery plans, but it’s time we started thinking about security incident response plans that are truly organisational wide.

If you’re interested in finding out more about our Cyber Security offerings you can visit our website, or email us at info.uk@soprasteria.com.

This blog was first published on Finextra.com, 11 November 2016