Oliver Pickup

Former Twitter VP on why we need an ‘in-the-office’ status

The bestselling author and former Twitter VP, Bruce Daisley, feels that many firms may be allowing hybrid workers to waste their precious time at HQ. He’s not alone

On 1 April, Bruce Daisley, author of The Joy of Work, posted a whimsical observation on LinkedIn that would ignite a serious debate about the modern workplace. He questioned whether an ‘in the office’ (ITO) message should supersede the traditional ‘out of office’ auto-reply (OOO). Given the timing of his post, the biggest fools are employers failing to adapt, because the old normal is no longer fit for purpose.

“Heard a brilliant thing today,” he wrote. “One firm says they don’t want workers in the office spending all day on email. The suggestion is that everyone should put their ‘in the office’ message on and deal with email from home.”

Daisley explains that he made the comment after he’d got wind of complaints from several employers that their hybrid workers were spending too much of their time in the office catching up on their emails, participating in video calls and completing other tasks that they could perform just as well remotely.

“We’ve spent two years reflecting on the best way to get our work done and then we’ve sleepwalked into a horrible solution,” says Daisley, who argues that the onus is on employers to determine which activities are most suitable in each workplace.

Noting that people often confuse being busy with being productive, he adds: “Hybrid working isn’t the best of both worlds; it’s the worst. We need to redefine our cultures. The more intentional we get about what we’re using the office for, the better. The office is a brilliant resource, but we don’t need to use it for everything.”

The argument is that the Covid crisis has generally tilted the balance of power at work towards employees, so the evolution of the office must keep pace with their changing preferences. Moreover, offices should be markedly different from remote working environments. Although much time, money and effort are required to make a success of hybrid working, culture should be the true key to progress.

Perhaps unsurprisingly, the results of a survey published by digital IT consultancy Ricoh Europe in March suggest that underinvestment and poor planning have reduced the effectiveness of firms’ return-to-office policies.

The indications are that employers throughout Europe have been struggling to adapt. Of the 3,000 workers polled on Ricoh’s behalf in the UK, France, Germany, Ireland, Italy the Netherlands and Spain, 36% said they had felt pressured to return to the office, while 44% agreed that their company’s culture had suffered during the Covid lockdowns. Pertinent to the debate about office-based work, 48% considered themselves “more productive when working remotely”.

Molly Johnson-Jones, co-founder and CEO of Flexa Careers, says she has been heartened to see that some organisations have understood recent changes in how employees view working in the office. But she argues that most of them need to do much more in this respect to attract and retain talent.

“The fact that we need to indicate when we are ‘in the office’ signals how people have come expect to work remotely for some, if not most, of their time,” she says. “For many companies we work with, office work is now reserved purely for the tasks and conversations that face-to-face meetings make easier. Having ‘ITO’ days for this kind of work can help to keep teams connected, maintain a sense of structure and boost staff wellbeing.”

The office is a brilliant resource, but we don’t need to use it for everything

Johnson-Jones cites research published in April by the Chartered Institute of Personnel and Development indicating that remote work is far more likely to boost an employee’s productivity than reduce it.

Flexibility is vital, which means that dictating when staff have ITO days can prove detrimental, she stresses.

“On days when coming into the office isn’t going to provide workers with any of the benefits mentioned – perhaps when they want to focus on deep work – they must not feel bound to do so,” says Johnson-Jones. “This is when companies risk tipping into creating a culture of presenteeism.”

She continues: “ITO days are helpful only if we keep them flexible. Employers must recognise that remote and office-based work are complementary and also that it’s no bad thing if one occurs more often than the other.”

Just over three-quarters (77%) of organisations are planning to redesign their offices to include more open-plan areas and collaboration spaces, according to new research from Poly, a US provider of telecoms tech.

This finding tallies with Tim Oldman’s belief that the “hotelification” of the workplace is a growing trend. He is the founder and CEO of Leesman, a firm that helps firms to assess the employee experience provided by their workplaces.

“Employees will treat offices differently because they are using them nomadically, booking in for a conscious stay,” Oldman notes. “They need to be beacons of warmth and hospitality to motivate them to come.”

He makes an important point about the feeling of sanctuary that returning to the office can offer to people whose remote workplaces are far from ideal.

“In a typical knowledge business, up to a third of employees do not have a separate space at home that they can designate for work,” he explains. “These people risk being a forgotten minority, whose needs are overlooked by those further progressed in their careers who are privileged enough to have a private room to spare.”

Of the idea that ITO is becoming the new OOO, Oldman says: “It’s happening already, although on a small scale. We aren’t yet at the point of this becoming a trend, but we are experimenting with post-pandemic practices.”

Stuart Templeton, head of Slack Technologies in the UK, offers a different take. He believes that “all businesses should be introducing and prioritising a digital headquarters: a place that serves as the main hub for collaboration, communication and connection between teams, wherever they are. The digital HQ doesn’t mean the office will disappear; it will be used for social, collaborative and dynamic activities.”

A digital HQ might be too futuristic for some people. But what’s evident is that where and when work takes place should be hugely different from the norm before the pandemic struck. A recent survey of 10,000 knowledge workers by Future Forum, a research consortium supported by Slack, has found that schedule flexibility is more important to them than location flexibility.

“Whatever work is done in the physical office, employees need to have a say in when they’re there,” Templeton argues. “Employers that don’t act accordingly will pay the price. Workers who are unsatisfied with their level of flexibility – in both where and when they work – are three times likelier than those who are satisfied to say they will ‘definitely’ seek a new employer in the coming year.”

He adds: “If you’re coming into an office daily just to stare at a screen, something’s gone wrong.”

This article was first published in Raconteur’s Hybrid Working report in May 2022

Professor Scott Galloway on why recruiters should stop ‘fetishising’ elite universities

While walking and talking on a videoconferencing call, professor Scott Galloway articulates why higher education organisations in the United States and elsewhere failed during the pandemic, and argues a more inclusive system that embraces a hybrid-teaching model is the only direction to take

Picture credit: Nick Rogers

No interviewee has accused me of being “full of shit” before. So when professor Scott Galloway, speaking to me via a transatlantic videoconferencing call while pacing around his spacious home, smartphone at arm’s length – the walking helps him articulate thoughts, he says, but the jerky, facial profile view is unorthodox and intense – labels me in those profane terms, I’m shocked.

And yet, given the 57-year old’s venerated standing as a pioneering thinker and controversial truth-speaker, his candour should have come as no surprise. Indeed, after completing an MBA from the UC Berkeley Haas School of Business in 1992, Galloway has, one way or another, been calling out BS, predicting future trends, and rallying against socially damaging systems and organisations.

First, he founded Prophet, a brand and marketing consultancy firm. Then, five years later, in 1997, RedEnvelope, one of the world’s first e-commerce websites, was launched. Along the way, the entrepreneurial Galloway has also established a digital intelligence company and an activist hedge fund, among other ventures. More recently, there have been influential books, podcasts, and digital newsletters, and, in 2019, he opened an online higher education startup, Section4.

Additionally, since 2002, Galloway has been clinical professor of marketing at New York University Stern School of Business. There, ‘Prof G’ teaches MBA students about brand management and digital marketing. A considerable amount of his research arrows in on the ‘Big Four’ – Apple, Facebook, Google and Amazon – and specifically how the ambition and rapaciousness of those tech titans have triggered a seismic social and economic change.

Unquestionably, business leaders can learn a lot from Galloway’s forceful opinions and predictions. Today I’m seeking his latest thoughts on what’s wrong with higher education, which – as he wrote in a contentious No Mercy/No Malice newsletter post in April 2021 – is “the most important industry in America. It’s the vaccine against the inequities of capitalism, the lubricant of upward economic mobility, and the midwife of gene therapies and search engines.”

Doubling down on positioning as luxury brands

Now, post-pandemic, he laments a “huge missed opportunity”. The top American universities have largely refused to pursue a hybrid-teaching model that would enable intake numbers to swell, therefore affording more students a better education and greater career opportunities.

“The most disappointing thing is the elite universities have decided to double down on their luxury positioning, and constrained supply,” Galloway says. “If they embraced technology, they could put half of their sessions online, and theoretically multiply supply overnight. However, they found out early on that online learning looks and smells the same, meaning differentiation doesn’t exist.”

He posits that American elite universities are “the ultimate luxury brand for wealthy people in China, the Gulf, and Europe”, who will pay massive sums of money to boost their children’s chances of attending. “By creating the illusion that an association with a brand – such as Bottega Veneta, Ferrari, or Tequila Ley – makes someone a better, more successful person, you can make irrational margins. The strongest brands in the world are not Amazon or Apple, but the likes of Oxford, Stanford, or MIT, because nobody pays $300 million to put their name on the side of Apple’s headquarters.”

These munificent endowments have led to what Galloway calls the ‘Rolexification’ of some university campuses, with higher wages attracting supposedly better teaching staff and no expense spared on facilities. Further, to maintain that exclusivity, admission rates have eroded in recent years, he contends. “When I applied to the University of California, Los Angeles (UCLA), in the 1980s, the acceptance rate was 74%, and this year it is likely to be around 6%,” Galloway continues. “I thought universities would leverage their brands, resources and technology during the pandemic to soak up the market. But I could not have been more wrong.”

He points out a worrying knock-on effect. “Now, there is so much overflow from people rejected from elite universities that the second-tier universities are demanding similar prices, effectively charging a Mercedes price for a Hyundai.”

Paying a heavy price for university education

Galloway, who donates all of his NYU salary back to the university and has contributed millions of dollars to both NYU and Berkeley for immigrant student fellowships, is gathering pace, physically and mentally. His side-on head lurches from left to right on the videoconferencing screen, the background a blur. “Here’s the thing,” he says, turning slightly to his smartphone camera, mid-stride, “these universities are technically private organisations, but they are non-profits. And non-profits usually have a societal, public-serving mission.

“I would argue that these companies no longer have a public mission because they are not growing their first-year-student intake despite the money coming in. Therefore, they should lose their non-profit status. It’s like a homeless shelter rejecting 90% of people because it’s decided to constrain the number of beds despite having the resources and skills to accommodate everyone.”

Pleasingly, with greater diversity increasingly prioritised by business leaders, a growing list of organisations, in the United States and elsewhere, have identified the modern problem with a university degree – most graduates will be laden with debt and need training up anyway – and sought alternative routes to tap into a much larger talent pool.

“The most significant thing to happen in higher education in recent years didn’t actually happen in higher education,” says Galloway. “Companies ranging from Google to Apollo, the big private equity firm, to Xerox have said: ‘We’re going to carve out a significant number of job positions for people who don’t have traditional college certification.’

“Encouragingly, a lot of great companies have recognised that if they’re only going to recruit at elite universities they have effectively decided they are not, for example, going to hire single mothers – there just aren’t a lot of single mothers collecting diplomas and walking across the stage at Harvard or MIT.”

Urging business leaders to be more open-minded about their approach to hiring, Galloway admits that he, too, was “guilty of fetishising and recruiting from the elite universities” early in his career. “We loved it, it made us feel good about ourselves. But as long as the best organisations continue to fetishise those places we are never going to break this cycle.”

Stunned to silence

At this juncture in the interview, I comment that I’m unconvinced my two young children will attend university. Suddenly, Galloway stops walking and looks directly at his phone screen. He calmly asks a series of questions, including whether I’m married and whether my wife and I attended university. Having answered “yes” to his queries, he raises the volume and picks up the pace again.

“OK,” Galloway starts, “so you’re full of shit. Both of your kids are going to university. While you pretend to be thinking avant-garde, the odds are that by the time they start secondary school, you will recognise the power of certification and begin creating landing lights and guardrails, putting your kids on track to university.”

Seeing I have been stunned to silence, he goes on. “I think you are expressing the general sentiment that university is slowly but surely not the return on investment it once was. My seven years of college education cost $7,000, so it was a no-brainer for me, the son of a single immigrant mother. It meant an unremarkable kid gained a remarkable certification and has resulted in prosperity and opportunity that I didn’t have access to previously.

“Now, an outrageous cost is attached to attending an elite university, but the certification that sets you up for life, making you more attractive to potential mates and employers, is still very powerful. And while people like you are starting to do the math, statistics based on your demographic, your profession, and the home environment you will create, your kids are college-bound, full stop.”

Mindset change required by those in charge

Desperate to shift the conversation, I ask whether Section4, which provides “unlimited, MBA-quality online business education”, according to its website, could be a viable and cheaper alternative to university. Certainly, it scores well on the cost and acceptance fronts, says Galloway, offering “courses at 10% of the price of an MBA, and with 1% of the friction, as there is no complicated application process”.

And although Section4 thrived during the pandemic, when people had more time to study online, he concedes that the platform has become more suited to “mid-career professionals” looking to expand their skills alongside colleagues, virtually. “We’ve transitioned from a B2C to B2B company, and have found, post-pandemic, that universities have become more proprietary about their professors doing talks for us.”

Bracing myself for more Prof G profanity, I pose a final question. What is Galloway’s key message? “There is a larger issue here in the US and Europe about whether we want to continue to embrace this rejectionist – almost nimbyist – mindset,” he says. “Regulators and university leaders need to start planting trees the shade of which we might not enjoy. Admission rates must be expanded, as must housing opportunities for young people.”

Turning to the camera once more and slowing his walk, he adds: “My generation has decided that it’s awesome not to provide younger people with the opportunities we had because it makes our assets, our houses, our diplomas, our shares all more valuable. It is bad for society and reflects poorly on the generation in charge. What’s happening in higher education is just a manifestation of that selfish mindset.”

Business leaders would do well to heed Galloway’s warning.

A (sanitised) version of this article was published by Raconteur in July 2022 – you can read that here

WTF is well-being debt?

The gut punches just keep coming. War in Ukraine, women’s rights under fire in the U.S. where a potential recession also darkens the horizon, and a cost-of-living crisis in the U.K. Add in the trauma of enduring two years of an unprecedented global pandemic and the climate crisis, and it’s no surprise many people feel their mental well-being is at an all-time low.

And while many employers are stepping up to the plate with financial assistance and additional benefits, much more investment is needed to bolster employee well-being, experts say. To help employers better understand the financial impact that having an exhausted and unhappy workforce has on the bottom line, a new term has been coined and is starting to be used more broadly: “well-being debt.”

But WTF is it?

This article was first published on DigiDay’s future-of-work platform, WorkLife, in July 2022 – to read the complete piece please click HERE.

‘I was thrown off a project because I misheard’: Deaf inclusivity in the workplace still an issue

The LinkedIn profile image of culture and behavioral change consultant Simon Houghton, shows him wearing a black mask with white writing that reads: “I’m deaf. I can’t read your lips with your mask on.”

Houghton, based in Reading in the U.K., has significant hearing loss so relies heavily on lipreading when communicating – a skill which became even harder to use during the pandemic when everyone wore masks. And while the rise of virtual meetings has helped to some extent (people still turn their cameras off blocking lipreading), workplaces still don’t cater well enough to people with hidden conditions like deafness or severe hearing loss.

To boost awareness Houghton launched social enterprise WeSupportDeafAwareness during the pandemic. His message is clear: not enough is being done to support deaf workers, who make up a large chunk of the population. Consider that 1.5 billion people – almost 20% of the global population – live with a degree of hearing loss, according to the latest World Health Organization calculations.

Houghton has had to pay a heavy price for this lack of inclusivity at work. One of his worst memories he still recalls. “I was working for a big-four management consultancy firm and was thrown off a project because I misheard an action during a client meeting,” he said.

This article was first published on DigiDay’s future-of-work platform, WorkLife, in July 2022 – to read the complete piece please click HERE.

What does the advent of sentient AI really mean for businesses and the workforce?

The futuristic notion that a machine will one day become self-aware, for good and evil, has been a staple of science fiction. So when a Google engineer reckoned the company’s Language Model for Dialogue Applications (LaMDA) program had achieved “sentience” in mid-June, it triggered both alarm and glee.

A fortnight before Lemoine’s claim, Elon Musk announced that a prototype of Tesla’s humanoid robot, “Optimus,” would be unveiled in September. Last August, the billionaire suggested the 173-cm, general-purpose bot would have “profound implications for the economy” and be capable of carrying out everyday tasks, including supermarket shopping.

So, how significant are these two headline-grabbing development for businesses? What, back in the realms of science fact and reality, could the advent of sentient AI mean for the future of work? And what should business leaders be doing, if anything, to prepare for this challenge and opportunity?

This article was first published on DigiDay’s future-of-work platform, WorkLife, in July 2022 – to read the complete piece please click HERE.

How companies are attempting to tackle diversity ‘blind spots’ at the hiring stage

In an attempt to root out all biases – conscious or unconscious – at the hiring stage, more organizations are overhauling their recruitment processes.

For many, that’s meant stripping their recruitment methods to the bare bones and examining everything from how language in job ads can influence who applies, to improving interview questions so they focus on a person’s aptitude and skill, rather than background and experience.

This article was first published on DigiDay’s future-of-work platform, WorkLife, in July 2022 – to read the complete piece please click HERE.

Which laws around the world are reshaping how we work?

Societal, political, and ethical forces are reshaping the world of work.

To get a handle on some of the changes, a slew of laws have been introduced. Some of them have been passed to tackle cultural trends that have arisen since – or been expedited by – the pandemic. Others are more freestanding.

When considering how the laws that have come into force – or are due to be passed soon – since the start of the pandemic will shape the future of work, a quotation attributed to American-Canadian writer William Gibson, father of the cyberpunk sub-genre of science-fiction, comes to mind. “The future is already here; it’s just not evenly distributed.”

Here are five new laws that will affect how work is done in the specific nations in which they have been inked:

This article was first published on DigiDay’s future-of-work platform, WorkLife, in July 2022 – to read the complete piece please click HERE.

Which tech has the greatest potential to transform banking?

A whole array of emerging technologies could grant a crucial edge to banks that can apply them successfully. How do their innovation specialists go about finding a winning combination?

In the long shadow of the 2007-08 global financial crisis, concurrent advances in three technologies – smartphones, 4G cellular networks and cloud computing – sparked an explosion of innovation in financial services. Their convergence enabled mobile banking: the sector’s most significant development in generations.

Just over a decade later, the industry is again “on the cusp of another inflexion point”. That’s the belief of Prakash Pattni, MD of digital transformation at IBM Cloud for Financial Services. He predicts that progress in tech including 5G, blockchain, artificial intelligence and quantum computing will trigger “another spurt” of innovation.

“People talk about data being the new oil,” Pattni says. “Well, blockchain is the new oil rig, and AI is the new refinery. The coming together of these things makes it an exciting time to be part of the industry.”

Given that R&D is notoriously costly and success is never guaranteed, how do banks approach experimenting with tech that might just as easily fall by the wayside as revolutionise their industry?

As head of innovation, global functions, at HSBC, Steve Suarez is particularly well qualified to answer this. He believes that the secret to successful innovation is to stay focused on “how to make things cheaper, faster and frictionless for people”. The bank is “constantly scanning the horizon to see how we can apply new technologies. We want to gather data that enables us to personalise banking and give our customers what they need, quickly but also securely.”

The London-based American applies what he calls a “three horizon” approach to innovation. Horizon one concerns “the stuff that we already know well and will incrementally improve things in the short term. Horizon two, which is about two or three years from now, concerns technologies that are fairly new to the industry – blockchain, for instance. We look at how we can provide use cases with these to make the bank better.”

He continues: “And then there is horizon three, which is about the long shots. Right now, they include the metaverse and quantum computing, which could turn out to be a game-changer for financial services.”

The possibility that a horizon-three punt might come off is clearly exciting to Suarez, but he’s careful not to get too preoccupied with the potential benefits of such tech.

“We’re all betting on these technologies to achieve an advantage. There are huge opportunities, but we also need to look at the risks from a security perspective and work out how we might need to structure ourselves,” he says. “As we process 1.5 trillion transactions a day, we understand our great responsibility to protect all customers.”

HSBC’s recent horizon-three R&D activities have included hiring experts in quantum computing and announcing a three-year collaboration with IBM to explore applications for this nascent tech and so ensure its “organisational readiness” to take full advantage of it.

The bank has also bought a plot of virtual real estate in an online gaming space called The Sandbox, marking its first significant foray into the metaverse.

People talk about data being the new oil. Well, blockchain is the new oil rig and AI is the new refinery

The term ‘metaverse’ was coined by sci-fi writer Neal Stephenson in his 1992 novel Snow Crash. He was referring to a digital realm in which humans, avatars and software programs could interact and where property could be purchased. Suarez indicates that HSBC intends to stay loyal to Stephenson’s original meaning.

“We will be building on our plot, putting in virtual stadiums and working out how to better serve our customers,” he says, hinting that the bank might seek to engage with sports and e-sports fans in the metaverse.

Jehangir Byramji is senior innovation manager and fintech lead at Lloyds Banking Group. He also revels in exploring potentially transformative emerging tech and “analysing weak signals from other markets and regions that the bank can use in the future”.

Byramji’s approach is slightly different from that of Suarez, though. He organises the bank’s IT innovation work into three broad categories: data; AI (particularly machine learning); and Web3 (tech based on decentralised systems such as blockchains) and the metaverse.

“On the data pillar, there’s this whole idea of ‘hard’ and ‘soft’ identities. Younger people are more worried about losing their social media profile than their passport,” he says. “They are more likely to embrace machine-to-machine payments. As a bank, you therefore need to think about non-traditional ways of processing their data.”

In this category he also places digital twins – virtual representations of real entities “to help you understand both your own organisation and its customers and clients”.

But Byramji is most enthused by the latest developments in machine learning. “You’re going to see more intelligent agents, just as much in the physical world as in the data realm,” he says, adding that the internet of things will play a key role in this field. “Some of our clients have connected factories or farms – the latest combine harvesters are covered in sensors, for instance – so we’re asking how we can use the data these smart machines gather in an intelligent way and work with clients to better serve them.”

Given the sheer range of possibilities, banks must remain focused on use cases that are most likely to benefit the customer, Byramji stresses. Otherwise, it’s a waste of time, money and effort.

“We’re starting to see quite gimmicky AI, with deep-fake videos and things like that,” he says. “While they are interesting developments, we have to remember our first principle: better serve our customers.”

That said, Byramji can’t help but be fascinated by the longer-term potential offered by Web3.

“Banks are unpicking blockchain technologies more effectively than they did a few years ago. We are starting to understand smart contracts and other capabilities that minimise risk and build trust,” he reports. “With these related technologies, I think we can form relationships with fintech firms, build ecosystems, develop new markets and unlock some exciting opportunities.”

This article was first published in Raconteur’s Future of Banking report in May 2022

Boomerang employees trend continues to grow, but is a returning worker a good idea long-term?

According to LinkedIn, boomerang employees accounted for 5% – 1.4 million people – of all new hires in 2021 in the U.K., a record high. The professional social media platform also contributed to this trend, with nearly 150 returning employees between September 2021 and February 2022.

It is a good idea for businesses to take a supportive and pragmatic approach, believes James Lloyd-Townshend, CEO and chairman of Frank Recruitment Group. Mainly because the workforce “is far more fluid now” compared to a decade ago, and the average length of service has reduced.

“There’s also far less of an ‘us’ and ‘them’ relationship between employer and employee today,” he said. “The dream scenario as an organization is for everyone leaving you to be welcome back at any stage in their career, and boomerang hires are just evidence of that attitude translating into practice.”

Glassdoor research published in 2020 calculated that the average U.K. employer spends around £3,000 ($3,688) per new hire, and the process takes approximately 28 days.

The price to pay for a wrong candidate is significantly higher, though. The U.S Department of Labor warns that a misfit will cost the business up to 30% of the employee’s wages for the first year. Others argue that the figure is significantly higher when training and supervision are factored in.

A Harris Poll research, published by USA Today in March, indicates the Great Resignation triggered during the pandemic has proved to be not so great for a high majority of movers. Indeed, just 26% of job switchers quizzed say they like their new position enough to stay.

This article was first published on DigiDay’s future-of-work platform, WorkLife, in June 2022 – to read the complete piece please click HERE.

Business leaders’ latest headache: Supporting staff through cost-of-living crisis, while staying profitable

The unholy trinity of rising energy, fuel and food prices is forcing U.K. residents to sacrifice luxuries — and even necessities — in a cost-of-living crisis that is already far worse than many predicted earlier in the year. Things are similarly bleak in the U.S., where inflation hit 8.6% in May, and the Federal Reserve has responded by raising interest rates by three-quarters of a percentage point — the sharpest hike in 28 years.

Granted, the war in Ukraine has exacerbated the situation. But with inflation now at 9.1% in the U.K. and the Bank of England, which raised interest rates to 1.25% in mid-June, predicting that will increase to 11% in the fall, plus almost daily record-high petrol and diesel costs, things are unlikely to improve any time soon.

In response to all of this, employers on both sides of the Atlantic are pushing through new policies to better support their employees.

This article was first published on DigiDay’s future-of-work platform, WorkLife, in June 2022 – to read the complete piece please click HERE.

Future of banking: what next-generation operating models are required?

Composability, partnerships with fintechs, and meeting customers on their preferred channel are all vital, according to a roundtable of experts. Watch the full roundtable here

Financial services operators were, according to ServiceNow’s Keith Pearson, “the white knights of the pandemic”. They came to the rescue of people and businesses stricken by the fallout of the coronavirus crisis. But, with the global economy in peril, they must saddle up again.

And yet, despite being saviours for many in the last two-and-a-half years, there is an incredible demand for banks, in particular, to evolve rapidly and offer personalised services and an omnichannel customer experience to rival the best in other industries.

To gallop along with change, steer clear of disruption, and continue to fight the good fight, those wishing to lead the way in the future of banking must partner with fintech experts, argues Pearson, AVP of financial services industry go to market at ServiceNow.

He points to a recent Gartner report, 2022 CIO Agenda: A Banking and Investment Perspective, which captures the challenge. “We are in a time of indefinite volatility, making it difficult for banks to plan for an indefinite future,” it reads. “Mastering business composability prepares banks to maximise business value regardless of ongoing uncertainty.”

Fay Wood, head of retail strategy at Natwest, sets the scene. “There is a looming cost-of-living crisis after unprecedented events – a global pandemic and a war in Europe – that few would have predicted three years ago,” she says. “Money management and supporting customers with budgeting and financial tools will be critical for the industry. As a result, these services are becoming much more embedded in people’s lives.”

Increased duty of care

Concurrently, regulators argue there is a greater responsibility on regulated firms to hold customers’ hands, metaphorically, and support them. Interestingly, some new financial terrains, whether it’s cryptocurrencies or buy now, pay later products, for instance, are not yet regulated.

Indeed, the Financial Conduct Authority’s final regulations on its new Consumer Duty will be available at the end of July and, following consultation, appear likely to force regulated firms to deliver “the best outcomes” for retail clients, says Wood. As an example of how NatWest better educates customers, the recently acquired Rooster Money app, with a pre-paid pocket-money card for those aged three and up, is currently free to access for the bank’s 17 million customers. “We wanted to do more for children,” she adds, highlighting the role acquisition is playing in the future of banking.

Metro Bank’s David Thomasson, managing director of digital and products, concurs that banks have to support customers better, whether online or offline, and build on the trust generated in the last two-and-a-half years. “Now, more so than before, they need to talk to somebody at the bank,” he says. “While digital is clearly becoming more important, seeing someone face to face is also vital. Our data shows that customers might not use a Metro Bank store for two months or even two years, but knowing that there is someone in a trusted environment nearby who can speak to you at a time that suits you is crucial.”

You must be prepared to think differently about your organisation’s structure and operating model and follow that through with your technology investment

It is not just individuals who crave that support. Thomasson states that 80% of Metro Bank’s business customers gained since the start of the pandemic operate within an eight-mile radius of a branch. “This shows the importance of the bank within a community,” he continues. “A service-led proposition and being there for communities will differentiate financial services organisations going forward.”

Banking in the metaverse

The “big difference” identified by Nadya Hijazi, global head of wholesale digital channels at HSBC, is that banks have to go to customers, not vice versa. In March, HSBC revealed it had bought a plot of virtual real estate in The Sandbox, an online gaming space, marking the bank’s first significant foray into the metaverse. She says: “It’s about ensuring your services are available wherever your customer wants to be, whether that’s in the metaverse or using WeChat in China. You must embed your services and be at the heart of the community.”

Banks can’t afford to ease up on innovation, and a mindset change is required to develop products and services that don’t need to be fixed, per se, Hijazi warns. “When you’ve got a revenue stream, there is no driver for change,” she says. “Usually, things change because something is not working. But now it’s dangerous to be complacent because if you don’t keep improving, then you will lose connectivity with customers.”

This concept chimes with Jasmeet Narang, chief transformation officer and head of operations at Santander UK. “Customers want choice and convenience, not just a load of off-the-shelf products,” he says. “The old stack-them-high and sell-them-cheap approach doesn’t work anymore. Instead, you have to understand customer needs, and most critically, you have to have that human touch.”

He stresses the importance of collaborating across the business and “organising design around the customer”, using their predicted wants and requirements as the guiding star, and justification, for any innovation. “Otherwise, you’ll always function in silos.” However, humans must be involved in the service, whatever technology is used. “It is those touch points with customers that are gold dust and will define the winners and the losers in the future of banking.”

Culture conundrum and composability

Narang says leaders have to activate a cultural change to drive innovation. “Top-down sponsorship is essential,” he adds. “Once you have that and a clear, long-term structure, other things follow. Also, you have got to be true to your convictions. The world will throw pandemics and wars at you, and at times you might have to be agile and flexible, but those that will succeed will keep the overall destination in mind.”

Yorkshire Building Society’s chief commercial officer, David Morris, believes the “evolution of banking distribution models is going to have quite pronounced effects, whether that’s embedded finance or banking in the metaverse, among many examples. New entrants, whether challenger banks or technology companies, will find ways of competing in the value chain in different ways. Therefore, that’s going to have big implications for business models.”

He continues: “How do you make sure you’re not left behind or not investing in the wrong technology? And how do you build that in an environment where you have to handle legacy infrastructure, macroeconomic uncertainty, and evolving regulations? Running an enterprise and building something different is incredibly difficult, and requires careful prioritisation and creative solution design.”

ServiceNow’s Pearson counters that bold banking leaders who look to partner with fintechs, use the agility of the cloud, and are willing to rip up old plans will triumph. “You must be prepared to think differently about your organisation’s structure and operating model and follow that through with your technology investment.”

He suggests the quicker banks can focus on building “composability” – essentially, a system design principle that deals with the interoperability of components – at scale, the better. “That’s what the future of banking will look and feel like,” Pearson concludes.

To find out how ServiceNow can enable digital transformation and improve experiences in your organisation, visit your.servicenow.com/businessinsights

This article was first published in Raconteur’s Future of Fintech report in June 2022

Sales talk: how conversational AI can win over customers

Conversational AI can mimic human interactions. With today’s consumers turned off by the hard sell, the technology holds strong potential for businesses

When it comes to sales, businesses should reverse Elvis’s famous advice: a little more conversation and a little less action, please.

The secret to success with today’s consumers revolves around small talk and a long-term approach. Direct approaches – seeking to add notches to the sales equivalent of a bedpost – are a huge turn-off for customers.

Happily, so-called conversational AI is now mature enough to assist adroitly with the more mundane topics, enabling humans to enter the chat room later, at the most appropriate point.

Conversational AI refers to tech solutions such as chatbots or virtual agents that use vast volumes of data, machine learning and natural language processing to imitate human interactions. Businesses today must adopt the technology as a matter of urgency, with laggards likely to lose out.

Technology doesn’t have working hours like a human employee does, meaning that customers can gain the help they desire on their terms

Over 70% of customers expect conversational service, meaning human-like interactions – complete with emojis, gifs, images and videos – whenever they engage with a brand, according to Zendesk. But only 40% of businesses can deliver this successfully.

Little wonder the global software-as-a-service company recently announced new capabilities for its Sunshine Platform, a customer relationship management service, including conversational automation via bot technology. The upgrade enables organisations to expand automation to messaging apps such as Facebook Messenger and WhatsApp and allows them to build and train custom bots to address common issues.

“A quick conversation can resolve most things in life,” says Matthias Goehler, Zendesk’s chief technology officer in EMEA. “Embracing advances in AI to deliver conversational exchanges with customers easily is a natural direction for customer experience (CX) teams to take.”

Resolving customer issues

One of the most significant benefits of conversational AI is that all customer communications are retained, Goehler adds. This means a more complete picture is achieved, allowing businesses to understand people’s personal preferences better and enrich their experience. It facilitates a personalised, data-driven service, removing some of the burdens on human agents and empowering them to do more for the customer in less time, he says.

“A conversational approach makes interactions more informed – built with the context of the customer’s history. When done right, it can even help increase a customer’s spending with you by making useful and simple recommendations to purchase from within a chat.”

Katie King is the author of two books about AI for sales and marketing and a member of the government’s All-Party Parliamentary Group Taskforce for the enterprise adoption of AI. Companies that embrace conversational AI will charm employees and customers alike, she says.

“Often, many of the queries that cross the service agent’s desk are frequently asked questions with simple answers,” she says. “While these queries might be easy to answer, they still take up valuable time and limit the agent’s capabilities to handle some of the more complex issues. It’s overwhelming and leads to faster employee burnout and potential staffing issues for the company.”

Conversational AI can help tackle this challenge, so appeals to many organisations, notes King. “AI can cut out that first step of the process by engaging the customer and potentially resolving their issue without human intervention,” she says. “Additionally, technology doesn’t have working hours like a human employee does, meaning that customers can gain the help they desire on their terms.”

When done right, it can even help increase a customer’s spending with you by making useful and simple recommendations to purchase

With the surge in energy prices, concerned customers of E.ON – the largest energy and renewable electricity supplier in the UK – have certainly wanted help. Conversational AI is easing the load.

Nikolai Berenbrock is the company’s head of conversational experiences. He says the company currently has more than 50 conversational AI solutions across the group, serving customers and employees and covering about 30% of demand. “This has enabled us to offer a better customer service experience and a massive reduction in our operational costs,” Berenbrock says.

E.ON uses AI to automate repetitive tasks so that agents are “available to jump in where they can make a valuable difference”, he adds. The technology “allows us to scale our customer service in a location and time-independent way, so that we can be where our customers are by offering our service on our website in a LiveChat channel, WhatsApp, Facebook Messenger, telephony channel, etc, whenever they need us, 24/7.”

Talking up the possibilities

Jason Costain is head of fraud prevention at NatWest, which serves 19 million customers across 12 banking and financial services brands. He offers another example of how conversational AI is being utilised.

“Using voice-biometric technology, we’re building a clear picture of our customers’ voices and what criminal voices sound like,” he says. “We can detect when we get a fraudulent voice coming in across our network as soon as it happens. Using a combination of biometric and behavioural data, we now have far greater confidence that we are speaking to our genuine customers and keeping them safe.”

Demand for conversational AI isn’t limited to customer experience, says Goehler. “We’re seeing huge demand from companies using our solutions for employee experience, with tickets filled by corporate employees jumping 31% last year – nearly double the rates seen by customer-facing support teams at B2B and B2C companies,” he says, signposting the direction of travel.

Despite the clear advantages of conversational AI and the momentum behind the technology, Goehler sounds a note of caution to business leaders who, to quote another Elvis song, can’t help falling in love with the technology. “While just over half of EMEA companies report that chatbots are becoming more human-like, AI can’t – and shouldn’t – be a 100% solution,” he says.

Zendesk research indicates more than 60% of customers will walk away after one poor experience – up 22% from last year. Perhaps this shouldn’t be a surprise. After all, who can blame their suspicious minds?

This article was first published in Raconteur’s AI for Business report in June 2022

Why more companies are sending new hires straight to the metaverse for improved onboarding

What will you learn on your first day at work in the metaverse?

This year, some 150,000 joiners will begin their careers at Accenture in the company’s virtual campus, called the Nth Floor, according to Allison Horn, the company’s executive director of global talent, based in Washington DC.

The Nth Floor is where new hires and existing Accenture staff “can have a more immersive experience for learning and networking,” said Jon Ayres, U.K. managing director for talent and organization at the company. It is one of a growing list of examples showcasing how employers are using pioneering technology to attract and retain top talent.

Given the tussle for top talent and the need for greater connection with colleagues in the age of hybrid working, Ayres predicts that companies will “experiment with new technology so employees can collaborate in a more meaningful way, which will advance the virtual working tools used widely today.” His statement is supported by new McKinsey research, published mid-June, which calculates metaverse spending will hit $5 trillion by 2030.

This article was first published on DigiDay’s future-of-work platform, WorkLife, in June 2022 – to read the complete piece please click HERE.

Flexibility is key to recruitment – and keeping your staff

Fallout from Brexit and the pandemic has led to more vacancies than applicants, but paying extra is not a long-term option

When the Office for National Statistics published its latest job vacancies data this week, it exposed the post-pandemic recruitment challenges facing most businesses. The number of unfilled positions in the UK increased by 20,000 between March and May to a record 1.3 million, while in the three months from February to April the unemployment rate dropped to 3.8 per cent, the lowest since 1974.

“For the first time since records began there are fewer unemployed people than job vacancies,” said Jack Kennedy, a UK economist at the job-listing platform Indeed. “That marks a dramatic turnaround from last summer when there were four unemployed people per vacancy. It also highlights the extreme tightness of the labour market, which has been fuelling hiring difficulties across many sectors.”

Cleaning, construction, warehouse, manufacturing and hospitality roles are all receiving lower interest levels on average than before the pandemic, he added. Brexit is exacerbating the challenges for sectors that relied on workers from the European Union.

The lack of flexible working in these roles, in comparison with desk-based jobs, is another factor, as is the number of people opting for early retirement.

The pandemic “put the brakes on decades of improvement” in employment rates among those in their fifties and sixties, said Ian Nicholas, the global managing director at the employment agency Reed. “The number of people in this age group who are not even looking for work has risen by 228,000,” he said, adding that companies should encourage older staff to stay in work to share knowledge and engage with younger members of the workforce.

This article was first published in The Times in June 2022 – to read the complete piece please click HERE (note: it is behind a paywall).

‘A business imperative’: How Salesforce developed its employee-centric hybrid model

The truism that a happy worker is a productive worker has perhaps never been more closely scrutinized.

At Salesforce, it has become the motto that underpins the company’s entire flexible workforce structure, which it has rolled out for its 77,000 employees globally.

This ‘Success from Anywhere’ model, launched in 2021, was the fruits of two years worth of internal employee surveys the company ran to get a grasp on what employees want from their workplace and their jobs, post-pandemic.

The model has made it a popular place to work. Salesforce is one of only four employers that feature on all five country lists — the U.S., the U.K., Canada, France and Germany) in Glassdoor’s Best Places to Work in 2022. And in late April, it was ranked top in the “super large” classification – organizations with over 1,000 employees – of the U.K.’s Best Workplaces 2022, elevated from third place last year, according to management consultancy Great Place to Work.

This article was first published on DigiDay’s future-of-work platform, WorkLife, in June 2022 – to read the complete piece please click HERE.

How switching to a 4-day week solved challenger bank Atom’s talent shortage

Six months ago, challenger bank Atom was in a tight spot: its growth tear was being stunted by a major talent shortage.

The company had 70 unfilled job vacancies and, in a tight labor market, was struggling to find the best talent to fill them.

To boost its visibility as a great place to work and attract top talent, Atom’s U.K.-based leadership decided to take the plunge and trial a four-day week, to see if it boosted the volume of candidates applying.

It worked. The company had a 500% increase in applications for open roles, according to Atom’s chief people officer Anne-Marie Lister.

This article was first published on DigiDay’s future-of-work platform, WorkLife, in June 2022 – to read the complete piece please click HERE.

Why the U.K. is becoming a forerunner for a ‘worrying recruitment trend’

While all countries have to deal with the pandemic-induced change in the job market, Ian Nicholas, global managing director at employment agency Reed, believes that Brexit is an aggravating factor and means that the U.K. is a forerunner of a worrying recruitment trend.

The break from the European Union has led to an “exodus” of lower-paid workers, with many industries – including construction, cleaning, manufacturing and hospitality – struggling to fill the vacancies, he added.

The deepening cost-of-living crisis is likely to make recruitment even more challenging. And it might mean organizations move abroad, Nicholas argues. “There must be a danger that some companies could relocate if they feel that they cannot attract and retain talent within the U.K. at remuneration levels that maintain their commercial competitiveness,” he said.

While business relocation is probably not currently front of mind for most leaders in the U.K., there are signs that other less extreme contingency plans and innovative recruitment schemes are on the agenda.

This article was first published on DigiDay’s future-of-work platform, WorkLife, in June 2022 – to read the complete piece please click HERE.

WTF is a digital HQ?

Pandemic-induced lockdowns forced many industries to dial up their digital capabilities rapidly. However, thanks to the marvels of technology, we learned that communication and collaboration were possible without being physically present with colleagues, even if “you’re on mute” was an all-too-familiar refrain.

But now that most businesses are firming up their post-pandemic strategies, with numerous organizations around the globe opting for a hybrid-working model, how can leaders strike the right balance between in-office and remote work?

In a digital-first, post-pandemic world, the physical office is no longer the key place that people connect, it could be argued. Could the answer be a futuristic-sounding digital headquarters with no proximity bias, where communication is transparent and the culture thrives? What many are referring to as a digital HQ?

This article was first published on DigiDay’s future-of-work platform, WorkLife, in June 2022 – to continue reading please click HERE.

‘I’m holding out to go to the toilet’: Why monitoring employees – inside and outside the office – is rocketing anxiety

How would you like it if your working day was monitored, and the time at the computer, the number of keystrokes and non-work-related searches all counted by your employer?

Despite knowledge workers pleading for greater flexibility and autonomy in this messy post-pandemic period, and a clear shift to measuring outcomes rather than time, there has been a massive surge in worldwide demand for solutions to keep tabs on staff, wherever they are working.

Now businesses are firming up their hybrid working strategies there is even greater interest in various forms of monitoring tech. Research from Top10VPN shows global demand for employee monitoring software jumped by 75% between January and March 2022, marking the biggest three-month increase since 2019.

This article was first published on DigiDay’s future-of-work platform, WorkLife, in May 2022 – to continue reading please click HERE.

WTF is Pleasanteeism?

You’ve heard of presenteeism, but a new and arguably even more troubling related term is now entering the business lexicon: pleasanteeism.

As businesses chisel their hybrid-working strategies, employees are being forced back into offices. And while many relish the opportunity to converse and collaborate with colleagues in person, for some, this cheery attitude belies underlying fears about returning to work, money troubles, and mental health woes. As a result, people are suffering in silence.

“Pleasanteeism is the sense that we always have to display our best self and show that we are OK regardless of whether we’re stressed, under too much pressure, or in need of support,” said Shaun Williams, CEO and founder of insurance firm Lime Global, who invented the term in August 2021.

This article was first published on DigiDay’s future-of-work platform, WorkLife, in May 2022 – to continue reading please click HERE.