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Digital Wealth Asia Forum 2019 HK - Exclusive Insights - Jay Sala - 2

Jay Sala of EY

Dec 2, 2019

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1. What’s the impact of artificial intelligence (AI) and big data analytics?

Video transcript

1. What’s the impact of artificial intelligence (AI) and big data analytics?

If you take a look at the long term or the potential end game, I think the impact of the greater use of data and AI is going to be very profound. I think that it's important to go back to first principles about the wealth industry and what it's meant to achieve because ultimately, wealth and asset management's about enabling the client to achieve a particular financial outcome. Right? Whether it's an institution, like an insurance company managing ALM, or a pension dealing with future pay-outs, a family thinking about retirement, so on and so forth, it's all about outcomes. Right? I think what data and AI will allow us to do is to do many things. One is, from a customer perspective, it's really to help firms to understand more specifically who their clients are. A lot of times firms use very broad-brush segmentation, like "We deal with individuals. We deal with high net worth. We have an ultra-net-worth client who's age 50 in the following industry." The reality is, you're really have to getting towards what I would call a segment of one. That segment of one is important because what we hear from individuals, as well as institutions, is that they want to make sure that their financial advisors or institutions are really meeting their specific needs, as opposed to the needs of a generic segment, right? So, I think the use of data, whether it's looking at social networks, in taking a look at transactions in the institution, taking a look at macro developments in the industry, taking a look at what's happening in investor markets, all about taking that information, that insight, to understand: what is the client, what are the relevant forces that are impacting on the outcomes that they want, and how should we be responding? So, I think that's sort of one aspect. I think another aspect where data and AI will help us really around that transition from selling products, to solutions, and frankly helping clients to achieve outcomes. I think that's really fundamental because when you speak to a client, and we do a lot of work around customer journeys for example, and the voice of the client, what they really want is help to achieve a particular outcome. I think that many firms are really stuck in the old model of really selling products, right? Somewhat monolithic, inflexible products. So I think data, and particularly as data and AI help us to think about the kinds of solutions and outcomes, and we start to change the architecture of our products and solutions deliver outcomes, I think that that allows firms to then really more closely target the actual needs and outcomes that the clients are trying to achieve. So, I think that's going to be another fundamental impact of AI. I think a third thing is, if we think about what's going to actually enable and underpin the delivery of target outcomes for clients, it's really going to be about operations. Do you have the right kinds of operations, infrastructure, and processes? So that's flexible, it's nimble, it's scalable, it's delivering to the quality that the clients want, 24/7, multichannel, all that stuff, right? So, I think that automation and AI is really going to help to streamline a lot of the backend that takes place in a lot of these organisations, right? I think if you put all that stuff together, where you have the digitisation, where you have the analytics, where you've got the deeper understanding of the clients, you've got the architecture and the means to try to deliver on outcomes, and you've got the operations infrastructure to deliver that in a seamless way. I think that the glue that will really bind all that stuff together is going to be analytics, because that'll be a means to sort of capture information. Then it's about having the analytics to then figure out how do we deliver the right information at the right point in time, right, to the client or to the advisor if you have a person in the loop assisting the client?

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