Developing Financial Talent for the 4th Industrial Revolution
Source: WEF
Digital Revolution
Convergence of Digital and Physical Worlds
Physical Revolution
Features of the 4th Industrial Revolution
Digital technologies
that will transform finance
Financial Innovation Through Digital Technology
Source: Nomura, Hana Institute of Finance
We Are Here!
IT Facilitator
Advancements in
digital technology
Impact on
Financial
Services
Online P2P loan
service,
launched in 2005
Paypal customers
have grown rapidly
since 1999
API-based bankBitcoin launched
(2009)
Financial institutions
Personal computer Internet
Financial institutions Financial institutionsNon-
FinanceFinancial institutions Non-Finance
Mobile IoT
Service
provider
Digital
technology
Overseas remittance
service, launched in 2011
API
API….
API
API
API
APIs Expand
Rebundling
Unbundling
2.93
3.26
2.57
2.89
1.8 1.82
US EU
Pre-crisis 2015 2025
Projected Cuts to Full-Time Financial Jobs Tellers Are Slowly Disappearing
Source: Citigroup
Impact of Automation on Financial Services (by Job Type)
Source: Mckinsey & Company
Impact of Machine Learning on Bank Settlement Processing
Source: Mckinsey & Company
15 min
Creative,
Innovative Work
Repetitive,
Routine Work
AI, Robotics Human
Employees
Alliance partners,
contractors
AI, Robotics
Tasks that require a
human touch,
creativity
Non-routine tasks
that require some
level of insight
Routine cognitive or
manual work
Types of work Who/what does the work
Employment Outlook and Skills Stability (By Industry)
“Skills stability”: The degree to which, by the year 2020, particular occupations and job types are expected to require competence in new skills
that have hitherto not been part of that occupation’s core skill set today
Source: WEF, ‘The Future of Jobs’, 2016
Demand for Skills in Financial Services (2015 versus 2020)
Skills Definition 2015 2020
Complex Problem Solving
Skills
Developed capacities used to solve novel, ill-defined problems in
complex, real-world settings35 39
Social SkillsDeveloped capacities used to work with people to achieve goals –
coordination, persuasion, instructing, negotiation32 23
Process Skills
Developed capacities used to understand the points being made
and monitoring performance of yourself, other individuals, or
organizations 36 34
Systems SkillsDeveloped capacities used to understand, monitor, and improve
socio-technical systems23 22
Resource Mgmt. Skills Developed capacities used to allocate resources efficiently 20 20
Technology SkillsDeveloped capacities used to design, set-up, operate, and correct
malfunctions involving application of technological systems5 16
Cognitive AbilitiesAbilities that influence the acquisition and application of
knowledge in problem solving15 23
Content SkillsDeveloped capacities used to communicate information and ideas
in speaking, writing22 24
Physical Abilities Abilities that influence strength, dexterity - -
Source: WEF, ‘The Future of Jobs’, 2016
Creativity• Apply resources (knowledge, data, technology) to
create new business models,
products/services, knowledge, and ways of
working
• Analyze and evaluate information in the digital
environment really explicitly
• Use logic and reasoning to identify strengths
and weaknesses of different solutions and
approaches
Digital
LiteracyCritical thinking
Collaboration• Communicate information and ideas effectively
• Work collaboratively with peers, experts, or others
employing a variety of digital environment
Attract Develop
Operate Engage
Shifting demands
on the workforce
PredictDigital Technologies
Changing business model
1
2 3
4 5
5 Steps to Manage Talent
1
Traditional Capabilities Digital Capabilities
New Talent Portfolio for the Digital Future
Digital
Business
Digital
Marketing
Digital
Dev.
Advanced
Analytics
Digital
transformation
Streamlined
and automated
fulfillment
processes
Targeted digital
media
Digital customer
lifecycle
management
Marketing
automation
Digital product
management
Customer
centric
experience
design
Omnichannel
experience
design
Comprehensive
data ecosystem
Robust
analytics and
data
infrastructure
Business
intelligence
Operational
excellence
enablers
Business
Strategy
Financial
Mgmt.
Risk Mgmt.Under-
writing
Product
Mgmt.Pre-Sales
SalesCustomer
service
27% of Goldman Sachs’ staff work in technology
1
FIs Recruit Tech Talent from Silicon ValleyGoldman Sachs’ Tech Talent Ratio
9,000
33,000
9,1996,897
3,638
GS Facebook LinkedIn Twitter
Engineers Full-time emplyees
Source: Business Insider, Goldman Sachs is a tech company, 2015
People are changing…
•They want work that is
interesting and meaningful
•They want to work for companies
that are open and innovative
•They want personalized careers
that ignite their passions
2
Why today's most promising young
people are choosing to work in tech
instead of finance
45
1715 14
10
4 3
The popularity of each industry as a career choice (%)
Millennials, Gen Z
2
Create a Talent-Friendly WorkplaceRedefine the Recruiting Strategy
1. Reinvented EVP (Employee Value Proposition)
2. Built an engineering recruitment team
- Hired a former executive of Square Inc. to recruit tech talent
3. Raised compensation levels
- Offer higher entry-level pay packages to compete with tech giants
4. Worked to make employees happier
- Develop wish lists to raise the satisfaction levels of engineers
(better hours; casual dress code; larger, curved computer monitors)
• Created a Silicon Valley-like work environment separate from
the more traditional culture of the bank
• Appealed to programmers, data scientists, engineers, etc.
• Adopted a casual dress code
• Offers in-office chefs, exotic retreats and benefits extending to
employees' pets
J.P. Morgan established
technology hubs for
millennial tech talent
Goldman Sachs redefined talent recruiting
practices to lure young talent
Fintech knowledge is not a “nice to have,”
but an essential asset for anyone working in financial services
FS professionals are bluffing about their digital
skills without understanding their meaning
– Blockchain, AI
94%
3
Source: FINTECH Circle Institute
22%Putting off developing digital skills out of fear that
it’s too late to build them
Lack of training for digital skills within
financial services organizations
69%
3
Digital Transformation Learning ProgramsTalent Development Framework
Day 1 Day 2 Day 3 Day 4 Day 5
Workshop to adopt
digital working methods
Hackathon to create
prototype mobile apps with startups
DBS create ‘triple-E’ framework for
digitalizing their workforces
Using action learning programs to develop digital mindset
AXA redefine systematic learning curriculum for
digital transformation
[ In-house Digital Academy ]
[ Hackathon program ]
• Offer extensive
programs
covering IT skills,
digital mindset &
culture
• Apply emerging
learning
techniques –
e.g., gamification
4
Traditional Organization
Hierarchy
Command & control mechanism
Silos between departments
Digital Organization
Decentralized, simple layers
Autonomy based on personal responsibility
Network-based flexible structure
4
ING’s new agile organizational model has no fixed structure
ING builds its organization to adapt rapidly and steer itself in new directions
5
Customer-centricity Experimentation
Collaboration Agility
Innovate Continuously
Digital
Culture
• 360-degree view of customer
• Outside-in approach
• Risk-taking culture
• Trial & error
• Failing fast
• Teamwork
• Information sharing
• Networking across boundaries
• Constant adaptation to change
• Real-time decision making
Thank you