Bots v's Humans - Future of the Fund Industry

by Ciaran Walshe
Trading


Will bots replace humans in the Fund Industry? This question has come up at many events I have attended over the past few years and below I try to explain where I feel bots will and won’t have an impact.

I do not believe bots can replace humans within the industry as so much of the human’s role is related to client service and building relationships with investors, investment managers, third party providers and so on. Where I see the bot having an impact is in completing repetitive tasks that can be automated so that the human can concentrate on providing an improved client service. Bots and humans will continue to work together within our industry and will complement each other.

The industry should be looking to automate the entire NAV process and by using the latest software this is possible. With manual processes comes human error. Using the latest and greatest software this risk can be reduced.

Robotic process automation is a way to automate repetitive and often rules-based processes. Using robots allows organisations to achieve significant benefits from process automation rapidly and without major investment before resorting to more invasive and costly solutions such as replacing core systems. The cost savings that can be achieved by implementing robotic process automation are far greater than those achieved by relocating processes to near shore or far shore locations.

The benefits of using bots for these manual tasks include, Operational Efficiency, Cost Reduction, Risk reduction and timely MIS. Bots will also process mid to high volume funds in a much more efficient manner.

Another valuable point is that bots are always on and working 24/7 for your clients even when your staff have left the office for the evening or are on annual leave.

Above we have highlighted areas where bots can have a real impact on the industry. However, an area that will always be performed better by humans is Customer support.

I strongly believe that optimal customer experience may be delivered with using a mixture of humanity and chatbots. It also must be integrated into your business with nothing needed to be downloaded or installed additionally. When talking to your chatbot, users should always have an option to contact a real human and ask for assistance.

You’ll quickly find that people like talking to people most of the time.

Computers are amazing at computation. They can look up data, calculate numbers, and do things like look at millions of fact-based options and return the best one in a matter seconds. Computers are not yet good at understanding human emotion.

Humans on the other hand aren’t great at computation, but are amazing at understanding human emotion. We have empathy. We know how to persuade people to first like, and then love something. We know what it’s like to be frustrated. We know what it’s like to over-deliver to make people feel better. We can reason. We can listen. We know when to remain silent, and when to interject.

I recently had a conversation with somebody in the industry who was arranging a meeting with a potential client. He was trying to build up rapport ahead of the meeting only to realise 3 or 4 mails in that it was a chatbot he was communicating with rather than the client. This is not a path the industry should be looking to go down.

The Turing test, developed by Alan Turing in 1950, is a test of a machine's ability to exhibit intelligent behaviour equivalent to, or indistinguishable from, that of a human. Although this has been passed by some of the latest chatbots out there the personal touch from a human will always be the preference for the end user.

At Fund Recs, we use Intercom for our customer support. And although there are chatbots available we have not started to avail of these yet as we feel having that relationship with our clients is key to growing.

Machines are taking over some human jobs, especially on the manufacturing side. But this isn’t a new development of the AI movement: it’s been going on for centuries.

Some people say it shouldn’t be Bots vs. Humans, it should be Bots and Humans.

In a recent article by Ed Hess – ‘In the AI Age, Being Smart Will Mean Something Completely Different’ he argues " What is needed is a new definition of being smart, one that promotes higher levels of human thinking and emotional engagement. The new smart will be determined not by what or how you know but by the quality of your thinking, listening, relating, collaborating, and learning. Quantity is replaced by quality. And that shift will enable us to focus on the hard work of taking our cognitive and emotional skills to a much higher level ".

With bots completing repetitive manual processes, reducing cost and risk, the humans can focus on providing improved customer support and growing better relationships, the industry will be in a much better place.

If you would like to discuss any of the above, please contact me at ciaran@fundrecs.com.

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