Change, as the saying goes, has never been this rapid before. And it is unlikely to ever again be slower than this rapid pace.
Keeping track of these developments has never been more important—or more difficult. That is why each year Accenture puts together the Technology Vision report, an in-depth analysis of the tech trends that will have the biggest impact on global business in the next three years.
This year’s report paints a picture of firms using technology to embed themselves throughout society, blurring the lines between business and personal while blazing a trail for future growth. The report heralds a new era in global business: the age of the intelligent enterprise.
What could justify such a bold claim? Accenture’s research team identified a number of trends that are rewriting the rules of the game and have implications for capital markets firms. I’ll go over the first two in this post.
The capital markets industry has a long history at the forefront of intelligent machine innovation from algorithmic trading and straight through processing to robo-advice. Our industry is increasingly using “enhanced judgement” artificial intelligence (AI) to augment human intelligence by evaluating and elevating options for consideration. For instance, next-best-action services systems draw on inductive modelling and research to produce timely insights on markets and clients that, in turn, inform recommendations to financial advisors.
These examples highlight an important consideration for capital markets firms. As AI becomes more autonomous, understanding and communicating how it works becomes imperative. Almost 90 percent of leaders told the Tech Vision survey that it is important for employees and customers to understand the general principles used to make AI based decisions by their organizations.
What happens if an investment focused AI makes decisions that lead to market losses for a client? Capital markets firms that fail to make their AI systems transparent and accountable could be left struggling to catch up with new regulations and public demands.
Using technology to shrink distance goes all the way back to the invention of the wheel. The immersive experiences offered by virtual reality and enhanced reality, collectively called “extended reality” or “XR,” can “relocate” people in time and space. This is why XR is bringing about the end of distance.
For example, the real estate company Redfin now uses XR to sell homes. Potential buyers and agents can “tour” real-world listings without ever setting foot on the property.
But XR can do more than eliminate physical distance—it can trim the gap between employees and the information they need to get work done. On factory floors, it can cut out the need for written instructions and the time required to consult them. GE Renewable Energy is using XR to deliver assembly information to workers wiring wind turbines, boosting productivity by 34 percent.
Such wide-ranging examples illustrate the potential of XR to address old problems in new ways across diverse industries. The relatively staid world of corporate training, for instance, is now projected to grow at 10 percent CAGR from 2017 to 2020 thanks to demand for XR worker training.
Capital markets players cannot afford to ignore a tech trend with such potential for industry-changing growth. Forward-facing firms should develop XR research teams and monitoring networks to track XR-related opportunities.
“Extended reality” and “Citizen AI” are both trends that could have big implications for the world of capital markets. Yet they are only half of the high-level trends that are reshaping the future of capital markets. In my next post, we’ll take a look at two more trends identified in the Tech Vision report and what they mean for capital markets.
In the meantime, you can find the full Technology Vision report here.