The CEOs of big financial institutions I’ve spoken to, who had previously felt that a large segment of their customer base were technophobes, have found that their customer base, no matter their age, and no matter what the services, have adapted to technology relatively easily. So as such both for business continuity reasons and looking ahead for customer service support, the Fintech sector in Luxembourg has generally remained robust, if not thrived, after a brief period where (quite understandably) institutions refocused internally on their operations to ensure that those were functioning in an era of lower physical contact and complete lockdown.
Opinion column by Nasir Zubairi, CEO of the LHoFT Foundation / Credits © Olivier Minaire / Silicon Luxembourg
Working from home is also not the right solution in this digital world.
There is much debate around work from home. My feeling is that yes, certain operations for a period of time can be conducted with disparate and remote workforce. However, in the medium to long term, creativity, innovation, culture will be strongly impacted if work from home is implemented in a massive way. We completely support a level of flexibility, but we see that most people, in order to build and to grow a business, need interaction, and the ability to brainstorm, face to face with others. As the pandemic has gone on in time, and firms have recruited new hires, the integration of those hires in a remote environment was really unfeasible, particularly for young graduates. So much learning comes over the coffee-machine conversations, overhearing, and collaboration within the office space.
The evolution of digital, and where we’ve come to now in terms of engagement and acceptability by the world and our local population in Luxembourg, would have normally taken probably 10 years if there was no Covid. In many ways, we are moving ahead in financial services. There is a worry that once things settle down, and COVID-19 is no longer a threat, there will be some sense of a return to normal or to return to the way we did things before, which is sad.
“It seems that institutions have the blinkers on, when it comes to understanding the different skills that are required to effectively approach a digitalization strategy.”
Talent, the key to the world of tomorrow.
Society has obviously changed and this impacts our behaviors. What we need to recognize now, as a service provider, is that we need to change appropriately, thinking not just today, but tomorrow. A key element of this is Talent. It always makes me wonder why a lot of people still believe that we need banking skills or financial services experience to build a good Fintech company, yet traditional institutions don’t feel that they need to leverage the experience and skills of those that have already built and understood technology, be it in Fintech or otherwise, to ensure that they get the technology strategy right.
We value experience. Yet, we’re not taking that into account. It seems that institutions have the blinkers on, when it comes to understanding the different skills that are required to effectively approach a digitalization strategy. You can’t just know it, you have to learn it through experience. There are multiple strategies that institutions can implement regarding Financial Technology: they can choose to build themselves, they can choose to partner, they can choose to collaborate, they can even choose to do nothing. However, in each case, knowledge of how to do it, as part of the broader text or digital strategy, will ensure a greater chance of success. Yet, for example, you don’t really see much training or upskilling, or talent being recruited into large institutions related to those skills.
Technology must be part of the strategy, and technology being part of the strategy is different to the way technology has been perceived for so long. Technology is considered an enabler as opposed to part of the strategic thinking in itself, and that’s wrong. It’s a framing issue, that if you think of technology simply as a means to deliver, rather than a core part of how you grow and define business. It’s a big difference.
There’s still much resistance to change within financial institutions, and concern about people losing their jobs. And what I don’t understand about any of that, because there’s three inevitabilities in life: death, taxes and change, is why do people resist? I was in capital markets, and yes we always used tech. But my job wasn’t anything related to what is now Fintech. I still remember the traders around me, the old manual traders trying to resist the pace of progress, resist the rise of algo-trading and the machine. We had to adapt.
“Technology is an enabler, enabler for growth and enhancement of society, enhancement of productivity, enhancing quality of life.”
Technology adds value.
Institutions need to look at the skills they require for the future. The future is not far away. We keep talking about that as though it’s so distant. It’s not, it’s now. The skill sets required for work are changing, where technology can come in and deliver and automate a lot of menial tasks and critically add value to intelligence by augmenting items in decision making, using the data. The critical thinking element of work becomes increasingly important and surely that’s the more enjoyable facet of work than doing something menial. Computers can do that just in the way they’ve done in our daily lives. We don’t need to have a telephone. We don’t need to remember our appointments anymore. Technology adds value. It’s not there to take away value but to create and you need to understand how to leverage it.
Young people are digital natives anyway. All studies show today that their attention spans are lower significantly than even the 30-year olds today. And it continues to erode, they multitask all the time, they need to be acknowledged, to be complimented, also because their expectations are higher. Compared and contrasted with the young generation in the 60s, who were born just after the war, they had little to no expectations growing up, and then the world was wonderful in the 60s, and their lives were happy, which is actually the opposite at the moment. Whereas we reached potentially the pinnacle of everything being wonderful. And our children are growing up with these high expectations. You’re not going to get productivity out of this generation in this current way of working. But there’s no reason why a 40-50 year old cannot adapt now, they have been adapting for the past 20 years. Show me a 50-60 year old that doesn’t have a mobile phone. We need to stop thinking that this will be detrimental to our work or risk to our jobs, and embrace it and look at how we can leverage it to do our jobs better, and to enhance our own careers.
Technology is an enabler, enabler for growth and enhancement of society, enhancement of productivity, enhancing quality of life.
This article is brought to you by the LHoFT Foundation and was first published in Silicon Luxembourg magazine. Read our full Fintech edition.