Automation Angst Hits Wall Street: Here’s Why It Shouldn’t
Investment bankers, fund managers and other Wall Street Masters of the Universe, as Tom Wolfe described them, are always eager to demand that public companies improve efficiency, pare costs and cut workforces to pump up profits and dividends.
Manufacturing and office automation have been tools they’ve advocated for making those improvements, but now it seems the shoe is on the other foot…and Wall Street doesn’t necessarily like it.
A McKinsey & Co. study projects that workflow automation and other technologies are “poised to sweep through investment banks, relieving many rank-and-file employees of roughly a third of their current workload,” according to Bloomberg.
This possibility is causing more than a little concern in these organizations. On one front, money managers are already being confronted by machine learning algorithms capable of making investment decisions based on crunching mountains of data with speed and precision no human can match.
On another, bankers and traders are trying to understand the impacts of workflow automation and “cognitive agents” that use A.I. to tackle various duties.
Workflow automation for repetitive tasks is a great fit in the finance world, in our experience, because of the huge process volumes involved in mid- and back-office operations. Those may involve automating forms and data entry, handling statement-generation processes, assuring accurate routing and approvals or myriad other tasks. Automating them improves the level of service for existing clients and can speed up the process of signing new ones.
But Wall Street has the same knee-jerk worry as Main Street employees: Will workflow automation put them out of work?
Evolve and thrive. Or else..?
The truth is actually the opposite, the McKinsey report explains. Companies embracing automation aren’t cutting workforces, because they’re simply eliminating the repetitive and mundane chores that get in the way of investment professionals focusing their attention on more productive and profitable tasks.
As one of the report’s co-writers says, “This helps free up valuable subject experts to do more. It will require people to use new skill sets, taking away manual work but allowing more around analytics, transformation and change.”
It’s the very same pattern we’ve seen unfold in our own customers’ workplaces. Workflow automation encourages better, smarter work, greater internal and external collaboration, improved client service and more. That, in turn, often results in a need for more new hires to handle new opportunities and growth made possible by the agility and efficiency that automation has given these firms.
So you can spare yourselves the angst and agita, Wall Street. The only trepidation you should feel? If you aren’t keeping up with your competitors as they adopt workflow automation, that’s when you’ve given yourself a real reason to worry.