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Augmented Intelligence and the Re-Deployment of Human Capital

Jim Warren is Head of Solutions Strategy & Development in SEI’s Investment Manager Services division. In this role, he is responsible for the strategic design and development of technology and services related to the wealth manager’s technology platform used for providing middle- and back-office outsourcing services to clients. Here he tells TFT where he considers the true value of AI in finance lies…

TFT: How can areas most ready for AI disruption be identified?

JW: AI is a powerful tool, but it’s just that – a tool.  When we think about AI, we’re not necessarily thinking

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Jim Warren, SEI

about how we can identify opportunities to implement AI. We’re thinking about the problems our clients and business face, and how we might best solve those problems.  We tend to focus on long-standing and persistent problems or inefficiencies within current processes or legacy systems, and AI is a primary consideration as we think through the solution set. More often than not, AI can generally add value to all of these solutions.

TFT:  Where is AI going to make the greatest impact on financial services?

JW: Right now, a lot of emphasis is placed on AI’s role in the front office (including the good, the bad and the “otherwise” results). But AI holds much more promise with a broader application on the operational side of finance, where a significant amount of inefficiency exists. AI, models, and algorithms that have a high degree of accuracy can help reduce those inefficiencies. Financial services will continue to broadly adopt some of the more successful applications in tech, marketing, and online retail, especially related to customer (investor) analytics and the client experience.  The personal wealth space also offers a huge opportunity to utilise AI and other scalable technologies to bring investment management and advice to the masses, democratising investing by enabling financial literacy and security for the general population in the future.

AI is a powerful tool, but it’s just that – a tool.

TFT:  What are the greatest barriers to wide-scale implementation of AI?

JW: Implementation costs, perceived and real risk, models and widespread reliance on stochastic processes serve as barriers. Legacy systems, talent acquisition and overwhelming amounts of data stand as obstacles to implementation as well. Depending on the organisational structure around AI and analytics, organisations experience challenges progressing from proofs of concept/pilot to production. Also GDPR, advice standards, and other regulatory demands may divert attention from development and implementation to compliance requirements.

TFT:   How can barriers to implementation be overcome?

JW: Continued investment, failing quickly and a smoother and smarter path to production can all help organisations overcome those barriers.

The personal wealth space also offers a huge opportunity to utilise AI and other scalable technologies to bring investment management and advice to the masses

TFT:  How can the workforce be better prepared for the rise of AI?

JW: Educating the workforce on AI’s capabilities is key.  Empowering the entire workforce to challenge existing processes and technology helps identify use cases and opportunities to explore better solutions. Wealth managers must understand how to use AI to their advantage and grow their businesses with its deployment. Operations and back-office services need to embrace the technology, understand how and why it works, get involved in its implementation, and identify opportunities for transformation.  Augmented intelligence is a term that’s often used to describe the future of people working with AI (as opposed to people being replaced by AI). There are many opportunities to think about how to utilise AI in an environment where human capital can be productively redeployed for scale and efficiency.

TFT:   Should we be scared of AI, what do you think the biggest risks?

JW: We should be hopeful but very conscious of AI’s limitations and potential. Over-reliance on any one technology poses major risks to organisations. The same is the case for AI.

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