“Technology is now [about] how our clients experience the bank, whether it’s through an app or digital service,” says Mike Dargan, group chief digital and information officer and executive board member at UBS. “As a natural consequence, tech is now an integral part of our business—it has a seat at the table and is part of our firm’s strategy.”
A cloud-based future
Underpinning the financial services sector’s transition to an “on-demand” data and services industry—where companies pay specialist providers for storage and infrastructure when the need arises—is cloud computing. These specialists are often the cloud service arms of Microsoft, Google, and Amazon. Only such tech companies, with their global networks of giant data centers, have sufficient computing capacity to meet the ever-growing demands of the finance industry.
“If you look at all the new requirements coming from central banks, governments, or even investors, financial services companies don’t have the data storage capacity to meet the needs,” says Scott Guthrie, executive vice president of the Microsoft Cloud + AI Group.
Back when banks embraced technology in the 1970s, they developed their own infrastructure, often installing servers in their data centers. The traditional system worked fine when computing demand was relatively uniform. But in periods of intense market volatility when demand for computing power spiked, banks needed to ensure that spare capacity kept growing, even though it was redundant most of the time.
“We often talk about the burstable, elastic nature of cloud,” says Dargan, referring to the idea that if a bank’s demand for computing power exceeds its normal level, its cloud partners can provide additional capacity instantaneously and only charge for the time it is used. This not only drives cost savings, but it also reduces carbon emissions because spare capacity is aggregated for the entire industry at the level of the cloud services providers, rather than maintained by each company. Reliability and uptime are also improved, because cloud providers have multiple data centers that can back up each other. Dargan says UBS achieves above 99.999%, or sixth sigma availability across its estate, partly driven by the move to cloud.
Cloud providers do not just offer storage and infrastructure, but also platforms and tools through which apps and services can be developed. Since Dargan joined UBS in 2016, its tech teams have shifted from using 50 different development tools to just one cloud-based service they launched, called UBS DevCloud. Through this open ecosystem, built on public cloud, UBS software engineers have a seamless experience to develop, test and release code within a single tool, enabling them to launch products quickly and update them often.
Cloud also allows financial services companies to match best-in-class consumer applications and develop exceptional customer-facing services. “The best-in-class consumer apps that you use every day know exactly what you click on and what you don’t click on, and exactly what their recommendation engines are doing. This means they can improve their features really quickly. Applying the same in our industry can be game-changing for our clients,” says Dargan. Such a desire to improve customer service, often amid competition from startup digital-only competitors, was one of the original drivers in financial services’ embrace of cloud computing, says Guthrie. “Financial services companies wanting to [provide] mobile or online, digital services to consumers was an early source of movement to the cloud.”
Cultural evolution
For an industry that pioneered the large-scale application of computing through in-house infrastructure, financial services firms’ shift to the cloud is a significant, generational change. That naturally leads to a degree of cautiousness.
The first step to finding out is to catalogue what microbes we might have lost. To get as close to ancient microbiomes as possible, microbiologists have begun studying multiple Indigenous groups. Two have received the most attention: the Yanomami of the Amazon rainforest and the Hadza, in northern Tanzania.
Researchers have made some startling discoveries already. A study by Sonnenburg and his colleagues, published in July, found that the gut microbiomes of the Hadza appear to include bugs that aren’t seen elsewhere—around 20% of the microbe genomes identified had not been recorded in a global catalogue of over 200,000 such genomes. The researchers found 8.4 million protein families in the guts of the 167 Hadza people they studied. Over half of them had not previously been identified in the human gut.
Plenty of other studies published in the last decade or so have helped build a picture of how the diets and lifestyles of hunter-gatherer societies influence the microbiome, and scientists have speculated on what this means for those living in more industrialized societies. But these revelations have come at a price.
A changing way of life
The Hadza people hunt wild animals and forage for fruit and honey. “We still live the ancient way of life, with arrows and old knives,” says Mangola, who works with the Olanakwe Community Fund to support education and economic projects for the Hadza. Hunters seek out food in the bush, which might include baboons, vervet monkeys, guinea fowl, kudu, porcupines, or dik-dik. Gatherers collect fruits, vegetables, and honey.
Mangola, who has met with multiple scientists over the years and participated in many research projects, has witnessed firsthand the impact of such research on his community. Much of it has been positive. But not all researchers act thoughtfully and ethically, he says, and some have exploited or harmed the community.
One enduring problem, says Mangola, is that scientists have tended to come and study the Hadza without properly explaining their research or their results. They arrive from Europe or the US, accompanied by guides, and collect feces, blood, hair, and other biological samples. Often, the people giving up these samples don’t know what they will be used for, says Mangola. Scientists get their results and publish them without returning to share them. “You tell the world [what you’ve discovered]—why can’t you come back to Tanzania to tell the Hadza?” asks Mangola. “It would bring meaning and excitement to the community,” he says.
Some scientists have talked about the Hadza as if they were living fossils, says Alyssa Crittenden, a nutritional anthropologist and biologist at the University of Nevada in Las Vegas, who has been studying and working with the Hadza for the last two decades.
The Hadza have been described as being “locked in time,” she adds, but characterizations like that don’t reflect reality. She has made many trips to Tanzania and seen for herself how life has changed. Tourists flock to the region. Roads have been built. Charities have helped the Hadza secure land rights. Mangola went abroad for his education: he has a law degree and a master’s from the Indigenous Peoples Law and Policy program at the University of Arizona.
Over the last couple of decades, scientists have come to realize just how important the microbes that crawl all over us are to our health. But some believe our microbiomes are in crisis—casualties of an increasingly sanitized way of life. Disturbances in the collections of microbes we host have been associated with a whole host of diseases, ranging from arthritis to Alzheimer’s.
Some might not be completely gone, though. Scientists believe many might still be hiding inside the intestines of people who don’t live in the polluted, processed environment that most of the rest of us share. They’ve been studying the feces of people like the Yanomami, an Indigenous group in the Amazon, who appear to still have some of the microbes that other people have lost.
But there is a major catch: we don’t know whether those in hunter-gatherer societies really do have “healthier” microbiomes—and if they do, whether the benefits could be shared with others. At the same time, members of the communities being studied are concerned about the risk of what’s called biopiracy—taking natural resources from poorer countries for the benefit of wealthier ones. Read the full story.
—Jessica Hamzelou
Eric Schmidt has a 6-point plan for fighting election misinformation
—by Eric Schmidt, formerly the CEO of Google, and current cofounder of philanthropic initiative Schmidt Futures
The coming year will be one of seismic political shifts. Over 4 billion people will head to the polls in countries including the United States, Taiwan, India, and Indonesia, making 2024 the biggest election year in history.
Generative AI’s ability to harness customer data in a highly sophisticated manner means enterprises are accelerating plans to invest in and leverage the technology’s capabilities. In a study titled “The Future of Enterprise Data & AI,” Corinium Intelligence and WNS Triange surveyed 100 global C-suite leaders and decision-makers specializing in AI, analytics, and data. Seventy-six percent of the respondents said that their organizations are already using or planning to use generative AI.
According to McKinsey, while generative AI will affect most business functions, “four of them will likely account for 75% of the total annual value it can deliver.” Among these are marketing and sales and customer operations. Yet, despite the technology’s benefits, many leaders are unsure about the right approach to take and mindful of the risks associated with large investments.
Mapping out a generative AI pathway
One of the first challenges organizations need to overcome is senior leadership alignment. “You need the necessary strategy; you need the ability to have the necessary buy-in of people,” says Ayer. “You need to make sure that you’ve got the right use case and business case for each one of them.” In other words, a clearly defined roadmap and precise business objectives are as crucial as understanding whether a process is amenable to the use of generative AI.
The implementation of a generative AI strategy can take time. According to Ayer, business leaders should maintain a realistic perspective on the duration required for formulating a strategy, conduct necessary training across various teams and functions, and identify the areas of value addition. And for any generative AI deployment to work seamlessly, the right data ecosystems must be in place.
Ayer cites WNS Triange’s collaboration with an insurer to create a claims process by leveraging generative AI. Thanks to the new technology, the insurer can immediately assess the severity of a vehicle’s damage from an accident and make a claims recommendation based on the unstructured data provided by the client. “Because this can be immediately assessed by a surveyor and they can reach a recommendation quickly, this instantly improves the insurer’s ability to satisfy their policyholders and reduce the claims processing time,” Ayer explains.
All that, however, would not be possible without data on past claims history, repair costs, transaction data, and other necessary data sets to extract clear value from generative AI analysis. “Be very clear about data sufficiency. Don’t jump into a program where eventually you realize you don’t have the necessary data,” Ayer says.
The benefits of third-party experience
Enterprises are increasingly aware that they must embrace generative AI, but knowing where to begin is another thing. “You start off wanting to make sure you don’t repeat mistakes other people have made,” says Ayer. An external provider can help organizations avoid those mistakes and leverage best practices and frameworks for testing and defining explainability and benchmarks for return on investment (ROI).
Using pre-built solutions by external partners can expedite time to market and increase a generative AI program’s value. These solutions can harness pre-built industry-specific generative AI platforms to accelerate deployment. “Generative AI programs can be extremely complicated,” Ayer points out. “There are a lot of infrastructure requirements, touch points with customers, and internal regulations. Organizations will also have to consider using pre-built solutions to accelerate speed to value. Third-party service providers bring the expertise of having an integrated approach to all these elements.”
