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This is part 9 of our ten-legged journey to explore how the Cloud can enable productivity, innovation, and scalability in financial services.
The ninth webinar highlighted the challenges, opportunities and use cases of how the Cloud fosters innovation from multiple industry perspectives. A panel of experts, including Prof. Nelson Phillips, Professor of Innovation and Strategy, Associate Dean of External Relations, Imperial College Business School; Eric Modave, Chief Operating Officer, Arab Bank; Didier Palut, Partner, Data Reply France; and Francesco Palma, Data Scientist, Data Reply Italy, shared their insights.
The webinar started off with Nelson Phillips setting the scene, based on the many interviews Freddy Gielen and himself conducted with senior leaders within the industry.
For many organisations the initial move to the Cloud itself is viewed as innovative, as it requires data and applications to be cleaned up and re-organised, with innovation being embedded into the transformation. A more sophisticated view sees the Cloud as an environment for innovation, which allows users to produce new products and services, improve client experiences, and ‘do things’ that were unimaginable before.
Digital native financial services companies have based their entire business models on the Cloud and are well-aware of the benefits it can bring to innovation. However, an increasing number of larger established companies are also moving to the Cloud. The focus of this webinar was to determine ‘what is vital when innovating in the Cloud’.
Following from Nelson we heard from Eric Modave, the Chief Operating Officer at Arab Bank.
Arab Bank started their innovation journey in 2018 with a concept of bringing digital identity into their innovation practices. This started with the Innovation Hub.
Eric highlighted the three main constraints in the use of the Cloud and new technologies in the Middle East. Firstly, as everywhere else in the world, there was a high demand for Cloud expertise but limited skills available in the market. This was emphasised in the Middle East, as it was not one of the early adopters of the Cloud. The second issue was fragmented regulators, which creates challenges for companies, in that each regulator comes with their own set of regulations. Lastly, the fact that top tier Cloud providers had not entered to the Middle East yet, but were still mainly based in the US or Western-Europe.
To overcome these challenges, Arab Bank firstly identified their best tech staff, who had the capability to re-train and educate themselves on the Cloud. Secondly Arab Bank invested in the youth; they trained cohorts of students on cyber security, data science and digital transformation for instance.
In 2020, COVID turned out to be a catalyst for driving innovation, as it forced people to work from home. Developers were no longer constrained by meetings and other work commitments, and had spare time to innovate and were eager to contribute. The use of the Cloud allowed developers to experiment and prototype more than they would have under normal circumstances.
Eric pointed out an important aspect when innovating in the Cloud: when using test environments, it is key to ensure that the same security controls are applied in production environments, so they can be easily deployed once ready.
Eric also highlighted some benefits to innovation experienced first-hand during his career. Cloud has helped integrate innovative solutions into the business, such as the improvement of customer journeys through the use of chatbots. Similar benefits can also be realised through partnership ecosystems, whereby API-partner integration can be accelerated and banks benefit from features beyond traditional banking services. Finally, the Cloud enabled more frictionless and seamless integration with different fintech partners.
Eric finished off by speaking about Hybrid and Multi-Cloud. Hybrid-Cloud is useful when regulation doesn’t allow to store processing power or sensitive data in the Cloud. Multi-Cloud strategy is not an option, as much as it is a necessity in today’s market. Some solutions are only provided by specific Cloud providers, so, to maximise benefits, users have to use multiple Cloud providers. However to keep things manageable, Eric wouldn’t recommend extending beyond four or five providers.
Following Eric, Didier Palut and Francesco Palma from Data Reply presented a case study of an innovative tool Data Reply has developed in the Cloud for the insurance sector.
Claims processing remains the main function of insurers. Some insurance companies use a virtual claims solution, which is based on photos being attached to insurance claims. This saves insurers time and resources, but the accuracy of these claims appears to be low. Data Reply enhanced this process to provide better accuracy, by using Deep Learning Image Recognition techniques implemented using Tensorflow, an open source platform for machine learning.
Francesco continued with a description of the technology used. It has two main functionalities; 1) the capability to detect from an image where the damage is located and 2) the capability to provide an estimation of the repair costs. Repair costs are based on a reimbursement estimation threshold, if below the threshold the damage is likely to be minor and the customer is automatically reimbursed. If above the threshold, an expert will validate the estimation before the customer is reimbursed.
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