Adam Lieberman, Head of Artificial Intelligence and Machine Learning at Finastra, discusses the impact of the digital skills gap caused by the new era of Artificial Intelligence and data.
The finance industry is facing a significant challenge in the form of a digital skills gap. As technology continues to evolve at a rapid pace, financial institutions, community banks, and credit unions are increasingly looking to technology experts to keep pace with the latest developments. The onus is on all to keep developing and acquiring new skills in areas like data engineering, data analytics, and data science, particularly in the context of Machine Learning (ML) and Artificial Intelligence (AI).
This has created an imbalance between the demand for these skills and the available supply. With the industry moving into a new era of AI and data, companies need to have the right people with the right skills to drive innovation and meet the changing needs of their customers. Therefore, investing in employee development – and igniting excitement in learning new skills in emerging technology – is crucial to succeed in the competitive world of financial technology.
Evolution of technology and skill sets
The digital skills gap in finance is part of a broader trend influenced by the changing technology landscape. Online banking was the first significant technological leap forward from a customer experience perspective, as it allowed customers to perform transactions and access their accounts from almost anywhere. As banks moved online, there was a requirement for professionals proficient in technology and information management to optimise the customer experience while also minimising security and cyber threats. The second wave was mobility, which required a focus on skills in UX, UI, and frontend development to support the demand for customer experience 24/7.
Cloudification was the next wave, enabling banks to reduce costs, improve scalability, and increase operational efficiency. This required skills in cloud computing and software development, especially on the backend and micro-services, along with data and analytics skills to deal with the increased influx of customer data and cloud monitoring tools.
The next wave of innovation in the form of AI and Machine Learning is now upon us. By leveraging algorithms, statistical models, natural language processing techniques, and generative models using AI, businesses with the right talent in place can analyse and interpret large data sets and extract relevant information. This helps to inform decision-making and support innovation in real-time, with a greater understanding of the context.
The impact of the digital skills gap
The rapid pace of innovation in AI has created a digital skills gap in many industries, including finance. In the finance sector, attracting technical talent presents additional challenges, as data analysts need to have a deep understanding of specific data privacy regulations, which can be a barrier to entry for those from other industries.
When there is a mismatch between the need for specific skills, such as data science and Machine Learning, and the available supply, innovation is impeded. Organisations without the right skillsets may struggle to keep pace with the rapid development of technology and may not be able to take full advantage of the latest tools and techniques to drive innovation.
Being proactive in addressing the challenges
There’s a clear opportunity ahead for organisations to take the lead in cultivating new talent and in supporting learning to help bridge the digital skills gap. Businesses and individuals alike can benefit from an approach that creates new and exciting opportunities for development, growth, and innovation.
To achieve this, companies need to make learning and development a top priority and embed it into their overall strategy. One way to create a culture of learning is by offering employees training and development opportunities. This could include formal training programmes, workshops, seminars, online courses, and mentorship programmes. By investing in their employees, companies can ensure that they have the necessary skills to keep up with technological advancements and adapt to changing business needs.
In addition to offering training opportunities, companies should also create a supportive environment where employees feel comfortable asking questions and sharing knowledge. This could involve creating forums or discussion groups where employees can share ideas and best practices. However, one of the simplest and most effective ways to encourage learning, in a practical way, is by opening hackathons to everyone, regardless of their background.
Hackathons are a great way to boost skills in emerging technology, even for non-technologists, due to the outcome-focused nature of the events. Business participants can work alongside technicians and engineers to experience the application of ML and AI first-hand in a ‘real’ environment, witnessing agile sprints and data science in a contained but valuable way. When your data science talent is on hand to run practical lessons, or ask-me-anything sessions, it encourages everyone to think like engineers and sparks a desire to keep learning.
Rewarding hackathon participants for playing a role is an additional incentive and can take the form of internal recognition or financial reward. Many people also value the sense of achievement for creating ideas that have a positive impact on the world of financial services, such as solutions based on inclusion or equity.
Attracting the right talent is more than offering higher salaries. It’s about creating and maintaining a sense of curiosity and making the opportunities to participate simple and open. Organisations must ensure they communicate the opportunities for career growth and development to candidates. They should also consider partnering with universities, industry associations, and other organisations to create targeted training programmes for students, encouraging them to pursue a career with them through mentorship and practical work experience.
Providing funding for skills development, such as those relating to industry-specific regulations, is another way organisations can encourage students to consider a career with them.
By working together, companies and educational institutions can create programmes that provide both current employees and the future workforce with the skills they need to thrive, as technology continues to evolve.