Happy New Year! Welcome to the next installment of new technology-related banking and business trends foreseen for 2016.
The ones presented here are far from the gee-whiz products presented at the latest CES (that’s the official name now, formerly standing for Consumer Electronics Show) that wound up last week in Las Vegas.
So, in this installment of Making Sense, no drones, no self-driving cars, no smart laundry machines, no intelligent electronic floor heating systems, no solar-powered barbeques, and, especially, no olfactory alarm clocks (wake up to your favorite smell).
The technology-related trends presented here may (or may not—you never know with crystal ball predictions) shape (or disrupt, according to the latest lingo) strategic and tactical approaches to the business world, including the banking industry.
Without further ado:
Where bank tech is heading
CapGemini Financial Services, a business IT solutions provider, delves straight into 2016 banking trends with these:
• Banks will invest more in blockchain technology. 2016 will be the year of big partnerships between blockchain and blockchain-like companies and major financial institutions.
• Banks will accelerate hybrid cloud strategies. As a greater number of IT apps and infrastructure move toward the cloud within the banking space, there will be an increase in banks seeking hybrid solutions that bridge both public and private cloud as a means of meeting security, privacy, performance, and regulatory requirements.
• Big data and analytics will become essential to enhanced customer relationships. Banks will increasingly analyze personal financial patterns from a broad set of unstructured internal and external data (including social media content) to generate a 360-degree view of the customer.
• Banks will make bigger strides toward regulatory compliance. Banks will adopt greater automation to replace costly, time-consuming, and error-prone manual processes.
• Payments security will continue to be top of mind. To avoid data fraud and breaches, banks, payments firms, and merchants are adopting multiple solutions, each of which has its own benefits and implications depending on the size of firm, volume of transactions, and other factors.
Changing needs of the CFO
Intacct, a provider of cloud enterprise resource planning services, looks specifically at the evolving role of the chief financial officer, citing a recent survey:
• Analytics must dig deeper. With business reporting and analytics overwhelmingly listed as the CFOs’ most important initiatives to support their business (80%) the survey finds that CFOs want more insights into their business than simply broad-stroke profit/loss performance.
• Where analytics must dig. Tools that provide greater understanding of nuanced business performance metrics such as customer lifecycle, churn, and business unit performance—specifically data analytics (61%) and systems integration (71%)—will be the CFO’s top technological investments over the next 18 months.
Three I’s for CIOs
Celent, a financial services consultancy, takes a similar look at the evolving role of the chief information officer, in a recent report.
Celent foresees a future where a CIO takes on a few different roles:
• The “innovator” seeks to understand industry changes, current and future business operating models, and the role that technology has in this future.
• The “instigator” is a change agent bringing energy and focus to the discussion of how the world is changing, and the impact on the business.
• The “integrator” connects the old with the new.
Mobile video moving in
Trusted Media Brands Inc., a multiplatform media company, conducted a survey of advertising agencies regarding mobile advertising formats and focuses on the rise of mobile video ads.
• Changing mobile face. While 63% of respondents used display banners in mobile last year, only 45% expect to do so this year. Almost half of respondents (45%) plan to use video in 2016.
• Customer perception of video. Mobile video is less intrusive than banner ads, build brand awareness lift and engagement, and offer a better user experience.
• Multi-sensory appeal. Sight, sound, and motion give video the advantage of being an ad format that works for marketers at both the top and bottom of the consumer purchase funnel.
Technavio, which specializes in market research and analysis, weighs in on the prospects of the biometrics access market.
• Body of evidence on North America. The firm’s research indicates that this is the largest market in the global biometric access control systems, accounting for a market share of around 38%. The region is experiencing higher adoption of biometric access control systems across banking, financial services, and insurance and government sectors.
• Growth in biometric methods. Biometrics access control systems will record a compound annual growth rate of more than 18% until 2019.
• Cloudy forecast. Of late, the market is witnessing increased demand for cloud-based biometric services as these are more secure and reliable.
How well will wearables wear?
APX Labs, which produces enterprise wearable technology, predictably but with insight looks at related industry trends:
• The internet of things and wearables will coalesce. In 2016 top businesses will create a single, connected enterprise fabric of people and machines formed by the collision of wearables and IoT.
• From adaptability to designed-for-wearables. To date, wearables have been developed using the processors, batteries, and components designed for other devices. This will change in 2016, when manufacturers begin to design and build components specifically for wearables.
From gee-whiz to aw-shucks
Notwithstanding the comment made earlier about the gee-whiz CES gadgets, here’s one more insight about wearables from APX Labs that may or may not sound troubling, depending on how they are instituted:
“By next year manufacturing economies of scale have created opportunities to add new embedded technology to just about anything you can think of. Traditional tools are being replaced with digital smart tools like Bluetooth-enabled torque wrenches. Uniforms will have embedded sensors that will track movement, position, and other key statistics. Workers’ badges will serve as smart nodes in a fully connected workplace, and contactless smart cards can serve as a combination of location beacon and authentication token. These will work in conjunction with other machines, cameras, sensors, and displays to transform the workplace in 2016.”
Sources used for this article include:
- PPP: SBA Issues Guidance on Changes in Ownership and Full Forgiveness Eased for Smaller Loans
- First Citizens, CIT Plan Merger to Create $100bn Bank
- OCC Levies Third Major Fine This Month
- ABA Urges DoJ to Update Market Data to Help M&A Governance
- JP Morgan Chase Outperforms, Good Sign for the Banking Industry