Artificial Intelligence-Powered Robots Won't Kill Banks Posted on : Mar 16 - 2018

The elimination of millions of jobs by battalions of artificial intelligence-powered robots makes for sensational headlines. But like many stories regarding both the threat and opportunity from technological change, the real story is both more nuanced and more interesting.

A recent report from the World Economic Forum predicted that intelligent automation could eliminate five million jobs in developed countries by 2020. So, you would think a recent spate of announced job reductions in Japanese banking over the next decade – over 30,000 in total at the three major banking groups - would be a cause for concern. Instead, on a recent trip to Tokyo, I heard from a senior executive at one of those banks that automation is vital to deal with a shrinking labor force as the country ages, and that busy robots are a better alternative for the country than unfilled job vacancies.

Despite this story of long-run job displacement in Japan, it’s wrong to conclude that intelligent automation will inevitably lead to fewer jobs in the financial services industry. Indeed, recent Accenture research suggests that - for those firms who embrace intelligent automation - revenues could rise by 32% by 2022, but critically employment could also increase 9%.

Just as in every other industrial revolution, job growth will also be associated with job change and evolution.  Crucially, the nature of many jobs will reflect new partnerships between man and machine. Humans will be required to teach, monitor, and maintain the automated technology, while intelligent automation will amplify and improve human skills and judgement. Of course, there will be areas in banking where machines will fully displace humans, but those roles will typically be in areas where the work is tedious and repetitive for current employees. There will also remain many roles that require creativity, empathy, and judgement, where machines will continue to play a limited role for the foreseeable future.  Ultimately, if we can better understand and define the symbiotic rather than destructive relationship between man and machine, we will be able to create not only more jobs, but also more interesting and higher value-added roles in the financial services industry.

Accenture’s recent 2018 North America Banking Operations Survey finds that this transition has already begun, with many firms using data and artificial intelligence to improve all manner of processes, from customer service to employee training. 22% of North American banks are already using AI, machine learning, and natural language processing, and another 55% intend to do so within the next year. Nearly one in five banks are already using robotic process automation technology and another 63% plan to do so within a year. The research also shows that many North American banks understand the symbiotic nature of these relationships, with 54% of firms saying human-machine collaboration is important in achieving their strategic goals. View More