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Drowning in Data, Financial Services and Insurance Industries Seek Technology and Talent to Close Global Insights Gap

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Drowning in Data, Financial Services and Insurance Industries Seek Technology and Talent to Close Global Insights Gap

Aite Group global study commissioned by TransUnion explores challenges faced by financial services and insurance industries, with UK executives showing strong appetite for talent and technology investment opportunities

Shail Deep

Shail Deep

Across the globe, companies are amassing volumes of data with the intent of optimising performance, identifying trends and meeting rising consumer expectations. Yet nearly 75% of global financial services and insurance executives admit they are challenged by the fractured nature and vast amount of data available, citing rich analytics capabilities as difficult to achieve. In the UK alone, 71% of executives admit they are challenged by the immense data they have.

With these challenges in mind, a new Aite Group study commissioned by TransUnion found that executives in the financial services and insurance industries plan on continuing to secure more data sources. Furthermore, they look to incorporate more artificial intelligence (AI) and machine learning (ML) technology into their analytic platforms to help them make sense of the information.

The global study explored the existing analytical processes, tools, data sources and operational effectiveness of analytics solutions used by the financial services and insurance industries. The quantitative online survey recorded the feedback of 682 marketing and risk executives at financial institutions located in the UK, the US, Canada, Hong Kong and India, many of whom do business across the globe.

The study found that the proliferation of AI/ML is expected to continue over the next 24 months, with 68% of UK executives, and three in four globally, considering integrating new analytic technology into their platforms. There’s good reason for this implementation as AI and ML can shorten the traditional analytic lifecycle from months to just weeks or even days.

Shail Deep, chief product officer at TransUnion in the UK, commented: “The collection, use and management of data has never been more strategically critical to business operations than it is today. And this importance is only set to grow. However, with the variety of data sources becoming increasingly diverse, it’s unsurprising that more businesses are adopting machine learning and artificial intelligence as tools to help them improve their analytical processes. It’s only by correctly analysing the data that we can draw meaningful insights. Otherwise businesses face the risk of being saturated with information, yet not reaping the benefits that data can deliver.”

 Help Wanted: Talent and Technology to Enhance Analytic Capabilities 

To stay competitive in a data-rich world, companies need access to cutting-edge analytic solutions and data science expertise. However, the study found that inflexible legacy technology, talent shortages and regulatory barriers are among the factors that prevent businesses from harnessing the power of analytics with speed and ease.

 “Most financial institutions lack a single, cohesive analytics platform,” said Tiffani Montez, senior analyst at Aite Group. “Firms may have vastly different data repositories and teams managing analytics functions, often leading to multiple approaches – by line of business, role and channel – across their institutions. To address these issues, many financial institutions are looking to centralise their data into a single platform that can quickly support change and integrate new data models.”

Enhancing analytic capabilities through AI/ML technology is a top priority globally, but with distinct differences across geographies. Specifically, 14% of global executives indicate they currently do not have any solutions that can implement AI/ML into analytical models. Slightly more UK executives (18%) indicate similar limitations. Globally, 66% of respondents – and a slightly lower number of UK respondents (58%) – believe this technology to be a major competitive differentiator.

The data scientist talent shortage is another pressing issue contributing to the global insights gap. As the volume of data has increased, the need for data science and analytics professionals has increased exponentially. Globally, 86% of respondents noted there are challenges with accessing the right data science and analytics talent. Similarly, 85% of UK responses cited the same challenge.

Analytics Challenges Across Regions 

Region Percent of Respondents Stating that the Finding Data Science Talent

is a Challenge

Percent of Respondents Stating that AI/ML is a Competitive Differentiator

 

Percent of Respondents Stating that they have no AI/ML

Analytical Models

United Kingdom 85% 58% 18%
Canada 82% 58% 7%
United States 74% 66% 22%
Hong Kong 88% 62% 14%
India 97% 78% 13%
Total 86% 66% 14%

*The Aite Group Global Survey of Marketing and Risk Executives was conducted in Q3 2019.

 To enable purposeful insights development, it is crucial for companies to streamline their processes and have closer alignment between the technical tools that are readily available and talent with specialised knowledge of turning data into insights. In the report, financial institutions noted they are increasing their investments in both talent and in analytics technology – but these firms are also greatly increasing their investments into another resource, more data.

 Despite Challenges Surrounding Analytic Capabilities, Data Sources are Expected to Grow

Financial institutions have placed an increasing amount of influence on the value of expanding data sources. The desire to invest in data includes new sources such as non-traditional, third-party and alternative data among the banking and insurance communities. Over the next 24 months, 89% of institutions globally – and 78% of UK institutions have plans to use alternative data.

More than half of global respondents plan to increase spending on most types of data sources with 65% intending to increase spending on newer forms of data such as mobile information about web browsing and app usage. In the UK, this percentage was significantly lower at just over a quarter (27%) of respondents intending to use new forms of data. Yet, about one third (34%) of UK executives indicated that the integration of new data sources will be very important to their business strategies. It is the lack of the right tools that seems to pose one of many issues, as only 17% of UK firms can integrate new data sources across all of their analytic solutions.

UK Investment in Alternative Data Sources Expected to Increase Over the Next Two Years 

Alternative Data Source Investment Increase of More than 15% Investment Increase of 5% to 15% Investment Increase of Less than 5%
Mobile Data (browsing, app usage, etc.)  

8%

 

15%

 

4%

Purchase (Spending) Data 0% 23% 15%
Social Media

Data

 

10%

 

14%

 

20%

Transactional or Bank Account Data 8% 13% 21%

*The Aite Group Global Survey of Marketing and Risk Executives was conducted in Q3 2019.

The survey also found that in the UK, 65% of marketing executives and 67% of risk executives expect their overall budget for data analytics to increase year-over-year. This was lower than the global average of 78% and 70% respectively, yet still points to a significant investment in expanding the amount of data available despite ongoing challenges such as data cleansing and preparation, which 78% of UK respondents said can be challenging. Global executives found this similarly challenging at 76%. This is in addition to the larger operational issues such as cumbersome technology and the talent deficit.

To learn more about the state of analytics in the financial services and insurance industries, please access the full Aite Group and TransUnion report, Current State Assessment: Global Analytics Ecosystem. More information about TransUnion’s analytics solutions can be found here.

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Australia says no further Facebook, Google amendments as final vote nears

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Australia says no further Facebook, Google amendments as final vote nears 1

By Colin Packham

CANBERRA (Reuters) – Australia will not alter legislation that would make Facebook and Alphabet Inc’s Google pay news outlets for content, a senior lawmaker said on Monday, as Canberra neared a final vote on whether to pass the bill into law.

Australia and the tech giants have been in a stand-off over the legislation widely seen as setting a global precedent.

Other countries including Canada and Britain have already expressed interest in taking some sort of similar action.

Facebook has protested the laws. Last week it blocked all news content and several state government and emergency department accounts, in a jolt to the global news industry, which has already seen its business model upended by the titans of the technological revolution.

Talks between Australia and Facebook over the weekend yielded no breakthrough.

As Australia’s senate began debating the legislation, the country’s most senior lawmaker in the upper house said there would be no further amendments.

“The bill as it stands … meets the right balance,” Simon Birmingham, Australia’s Minister for Finance, told Australian Broadcasting Corp Radio.

The bill in its present form ensures “Australian-generated news content by Australian-generated news organisations can and should be paid for and done so in a fair and legitimate way”.

The laws would give the government the right to appoint an arbitrator to set content licencing fees if private negotiations fail.

While both Google and Facebook have campaigned against the laws, Google last week inked deals with top Australian outlets, including a global deal with Rupert Murdoch’s News Corp.

“There’s no reason Facebook can’t do and achieve what Google already has,” Birmingham added.

A Facebook representative declined to comment on Monday on the legislation, which passed the lower house last week and has majority support in the Senate.

A final vote after the so-called third reading of the bill is expected on Tuesday.

Lobby group DIGI, which represents Facebook, Google and other online platforms like Twitter Inc, meanwhile said on Monday that its members had agreed to adopt an industry-wide code of practice to reduce the spread of misinformation online.

Under the voluntary code, they commit to identifying and stopping unidentified accounts, or “bots”, disseminating content; informing users of the origins of content; and publishing an annual transparency report, among other measures.

(Reporting by Byron Kaye and Colin Packham; Editing by Sam Holmes and Hugh Lawson)

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GSK and Sanofi start with new COVID-19 vaccine study after setback

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GSK and Sanofi start with new COVID-19 vaccine study after setback 2

By Pushkala Aripaka and Matthias Blamont

(Reuters) – GlaxoSmithKline and Sanofi on Monday said they had started a new clinical trial of their protein-based COVID-19 vaccine candidate, reviving their efforts against the pandemic after a setback in December delayed the shot’s launch.

The British and French drugmakers aim to reach final testing in the second quarter, and if the results are conclusive, hope to see the vaccine approved by the fourth quarter after having initially targeted the first half of this year.

In December, the two groups stunned investors when they said their vaccine would be delayed towards the end of 2021 after clinical trials showed an insufficient immune response in older people.

Disappointing results were probably caused by an inadequate concentration of the antigen used in the vaccine, Sanofi and GSK said, adding that Sanofi has also started work against new coronavirus variants to help plan their next steps.

Global coronavirus infections have exceeded 110 million as highly transmissible variants of the virus are prompting vaccine developers and governments to tweak their testing and immunisation strategies.

GSK and Sanofi’s vaccine candidate uses the same recombinant protein-based technology as one of Sanofi’s seasonal influenza vaccines. It will be coupled with an adjuvant, a substance that acts as a booster to the shot, made by GSK.

“Over the past few weeks, our teams have worked to refine the antigen formulation of our recombinant-protein vaccine,” Thomas Triomphe, executive vice president and head of Sanofi Pasteur, said in a statement.

The new mid-stage trial will evaluate the safety, tolerability and immune response of the vaccine in 720 healthy adults across the United States, Honduras and Panama and test two injections given 21 days apart.

Sanofi and GSK have secured deals to supply their vaccine to the European Union, Britain, Canada and the United States. It also plans to provide shots to the World Health Organization’s COVAX programme.

To appease critics after the delay, Sanofi said earlier this year it had agreed to fill and pack millions of doses of the Pfizer/BioNTech vaccine from July.

Sanofi is also working with Translate Bio on another COVID-19 vaccine candidate based on mRNA technology.

(Reporting by Pushkala Aripaka in Bengaluru and Matthias Blamont in Paris; editing by Jason Neely and Barbara Lewis)

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Don’t ignore “lockdown fatigue”, UK watchdog tells finance bosses

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Don't ignore "lockdown fatigue", UK watchdog tells finance bosses 3

By Huw Jones

LONDON (Reuters) – Staff at financial firms in Britain are suffering from “lockdown fatigue” and their bosses are not always making sure all employees can speak up freely about their problems, the Financial Conduct Authority said on Monday.

Many staff at financial companies have been working from home since Britain went into its first lockdown in March last year to fight the COVID-19 pandemic.

One year on, the challenges have evolved from adapting to working remotely to dealing with mental health issues, said David Blunt, the FCA’s head of conduct specialists.

“During this third lockdown, there has been a greater impact on mental well-being, with many people struggling with job security, caring responsibilities, home schooling, bereavements and lockdown fatigue.”

Bosses should continually revisit how they lead remote teams, he said.

“The impact of COVID-19 is creating a huge workload for those considered to be high performers, while the remote environment potentially makes it much more challenging for those who were previously considered low performers to change that perception,” Blunt told a City & Financial online event.

Companies should consider “psychological safety” or ensuring that all employees feel confident about speaking out and challenging opinions.

“We’ve heard varying reports of how successful this has been,” Blunt said.

Pressures in the financial sector were highlighted this month when accountants KPMG said its UK chairman Bill Michael had stepped aside during a probe into comments he made to staff.

The Financial Times said Michael, who later apologised for his comments, had told staff to “stop moaning” about the impact of the pandemic on their work lives.

Blunt was speaking as the FCA next month completes the full rollout of rules that force senior managers at financial firms to be personally accountable for their decisions to improve conduct standards.

There have only been a “modest” number of breaches reported to regulators so far as firms worry about being “tainted” but more cases will become public as sanctions are revealed, Blunt said.

“Regulators won’t be impressed by lowballing the figures.”

(Reporting by Huw Jones; Editing by Mark Heinrich)

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