Amcham: What is the current digital reality and what are the digital trends and practical imperatives for the business community and other bureaucracies?
Jervis Smith: It varies a lot by type of business. Traditionally, banks do have very automated processes in place, but are usually wrestling with how to capture data efficiently for analysis purposes. While the larger traditional Investment Managers are getting better at implementing Artificial Intelligence-based solutions, they tend however to generally lag a bit in this space, as well as Alternative fund managers.
Vistra, as an organisation, had embarked on a journey towards full digitalisation from a highly manual start four years ago.
Our goal is to move our data to digital format so as to standardise and automate but also to make data capture easier, and robotise certain areas such as Transaction Monitoring (part of our Anti Money Laundering process).
An example of how this digital transformation is helping clients is a custom-built secure platform for onboarding, reporting and information sharing.
This allows them to access fund-related documents, dashboards to give easy access to visualised data from a high-level to drilldown at a granular level, and benefit from processes that offer a transparent method to electronically publish, complete and collect investor subscription documents, allowing risk of error to be reduced.
What exactly do we mean by digital transformation: How do you define it and what components are involved?
What I mean by digital transformation is developing common processes around common data on common systems. At Vistra we have been able to do this using a platform of common technology systems which we link to client technology to transfer data using APIs, and our Vistra Integration Platform (‘VIP’) this provides:
- Interoperable processes and data flows
- Multi-country application & workflow
- Unified environment hosting organisation´s Applications
What are the benefits to be derived from a digital transformation and what are the negatives consequences?
The key benefits are: better accuracy, better efficiency, better decision making based on data, and flexibility which enhances the clients experience.
Repetitive tasks can be automated and streamlined, reducing the risk of manual input.
In our organisation, the main benefit is allowing for a multi jurisdictions, multi departments and processes to share information and provide our clients for a single source for data input and output, streamlining operations and improving speed-to-market for them. In other words, it opens up ease of access to information by linking our systems to portals and mobile apps for our clients to access data 24/7.
The potential negative consequences are of course mitigated by considering the below key points:
- top notch Information security to guard against cyber attacks
- data confidentiality and protection needs to be vouchsafed
- dependency on technology – so you need to have strong business continuity and data warehousing backups.
- reduction in junior roles has an impact on how to train new recruits
Where does Luxembourg stand compared to other European and global countries in this transformative process: what are we doing right and what do we need to do better?
Luxembourg is very advanced in encouraging digitisation and the government has taken several measures to promote transformation in several sectors.
It is also foreseeing the development of the digital economy bringing together stakeholders to promote innovation – for example the Luxembourg House of Start ups and the LHoFT
Luxembourg is also known for its data centers and hosting services attracting global companies to store and process data here. This coupled with investment in 5G and loT has supported digital transformation.
Where and how should businesses and other bureaucracies start with digital transformation? What process steps do government bureaucracies and companies need to get right and do to be successful digitally to transform themselves?
First it is important to identify where the company will benefit most from digitisation. Likely areas are:
- Client experience
- Data analysis
Then they need to have a clear and comprehensive plan outlining the goals, resources, and timelines needed to execute the transformation.
They will need to hire experts who have experience in implementing such projects. This will be a mix of technologists and business people – important to involve the users in the planning and implementation.
What factors will be driving digital transformation?
We mentioned it earlier but improving the service to clients, the cost efficiencies, removing errors from human interventions, and speeding up processes.
What are the consequences if we do not undertake a successful digital transformation: how will it impact our business competitivity and our quality of life?
Eventually businesses have no choice. They will be disintermediated or overtaken by their competition, it is a matter of survival of the species. Nobody wants to be running a dinosaur!
Amcham would like to take this opportunity of thanking Mr Smith for this interview