A global survey of 2,000 investors and 500 investment providers sponsored by State Street has identified three main aspects of data that will define stewardship for the digital age.
The three aspects of data and its management are:
- integration, the ability to combine both structured and unstructured data
- intelligence, the ability to draw new insights with the help of emerging technologies that will enable improved decision-making, performance measurement and client centricity, and
- integrity, the ability to better safeguard data with the highest levels of security.
The new report, ‘Finance Reimagined: Finding Long-Term Value in a Digital Age’,combines quantitative research with views from industry experts, to explore how firms across the financial services industry are using digital technologies to enhance their businesses.
The 150 investment providers surveyed in Asia Pacific (APAC), including universal banks, mutual funds, alternative investment firms and fintech start-ups, cited new technology as one of the main trends redrawing the marketplace in the next five years. A total of 87 per cent say digital transformation is important for the future of their organisation.
Despite this clear understanding of the importance of digitisation, providers in the region showed great variance in their pace of embracing new technologies: Overall, Japan-based investment providers are ahead of their peers surveyed in APAC on the path to digital transformation. Australia-based providers come second and are followed by China and Hong Kong. Key outcomes in the report include:
- Among all aspects of digital transformation, APAC investments providers are most advanced in terms
of developing an innovative culture, with 72 per cent of respondents in Japan, 40 per cent in Australia and 26 per cent in
China/Hong Kong claiming to have achieved this. - 58 per cent of Japan-based respondents (versus 56 per cent of respondents in Australia and 14 per cent in China/Hong
Kong) are at an advanced stage of applying robust cyber security measures that ensure data
integrity. - 54 per cent of Japan-based respondents (compared with 30 per cent in Australia and 22 per cent in China/Hong Kong) are fully harnessing data and analytics to improve decision making.
- Across the APAC region, respondents feel relatively unprepared when it comes to setting up systems
to identify important emerging technologies such as blockchain and artificial intelligence, with only 9 per cent in the region (12 per cent in Australia and Japan respectively, 2 per cent in China/ Hong Kong) claiming to be at an advanced stage. - 86 per cent of China/ Hong Kong respondents (compared with 72 per cent in Australia and 56 per cent per cent in Japan) aren’t currently in an advanced stage of building an integrated, omni-channel approach to digital transformation.
Lou Maiuri, head of State Streets global markets and exchange businesses, said: “Digital transformation is driving a seismic shift in the investment industry. While it’s critical to understand how new technologies can deliver immediate improvements in efficiency and insight, to become digital leaders, those in the finance industry also need a long-term vision for digital transformation that goes beyond simply adding the latest technologies to an existing infrastructure.
The report also identifies how investment firms can recognise and act on opportunities to digitise aspects of their organisations by highlighting several shared beliefs of digital leaders globally:
- Adequately invest in new technologies like cloud and artificial intelligence is critical
- Prioritising cybersecurity is the foundation for building solid client relationships based on trust and transparency
- Having the right talent and a strong customer-centric focus will accelerate organisations’ journey to a digital future.
Maiuri said: “We’re focused on how deep-rooted digital innovation can generate new value for our clients by developing highly personalised, data-driven products that appeal to a broader range of investors.”
* Greg Bright is publisher of Investor Strategy News (Australia)