Welcome to the pcl. podcast series. My name is Toyosi. The pcl. podcast series features conversations with leading experts and professionals who share their insights on thought-provoking perspectives on topics relating to business strategy, people, and technology. Today we will zone into the fintech space, and our topic for discussion is technology trends shaping 2022. It is without a doubt that technology has been evolving since its inception. So, you may be familiar with some buzzwords relating to techs such as business process automation, cloud computing, the Blockchain, the Internet of things, artificial intelligence, and the like. Addressing our topic today is Henry from pcl. A managing consultant for the Digital Technology Consulting Practice.
Hi, Henry. So good to have you here. How are you doing?
Henry Ogbu
Hi Toyosi, it is my pleasure. I’m great and you?
Toyosi Boyejo
I’m doing fine. So, straight to the point. We’re going to start with the Fintech space. So, what will you say were the tech trends as of 2021 in Fintech?
Henry Ogbu
Thank you for that critical question. I think that in 2021, considering the Coronavirus and the Pandemic restrictions, it’s obvious for us to look at things around collaborative work. Virtual work- So, technology that supports virtual work, of course, got prominence. And we also saw a lot of movements in the business process automation space and robotic process automation as they were situations where people could not physically be at their offices to do their work. Hence, robots were incorporated to help with such work. We saw a lot of that happening. The other side of it is cloud computing because I think there was a shock. People had to begin to look at cloud computing and implement cloud computing to survive the pandemic and restrictions. Behind all this, you talk about cyber security. When you expose your system to the cloud, you should be mindful of the cyber world’s risks and threats. I think these are the areas I would say there have been many activities last year.
Toyosi Boyejo
It’s understood that the Pandemic disrupted people and business operations. So, I would expect that since the Pandemic year, up until last year, people and businesses struggled with incorporating technology hence the trends that you mentioned. In 2022, although the year has started, what do you foresee to be the likely trends in 2022 related to technology?
Henry Ogbu
Thank you, Toyosi. I would look at the consolidation and acceleration of where we were or the technology trends that ruled 2021. I mentioned the same thing about automation, moving the needle of digital transformation further. Okay. And on top of that, I think there will be some shift in the regulatory, especially for the financial sector, which is highly regulated. I look forward to seeing some new regulations to guide and shape the digital world we are in today regarding moving things to the cloud; a new regulation will have to come in, data privacy and data governance. These are the things I expect that would be prominent, especially for the financial sector in 2022. In addition to the number of the items I’ve spoken about before that competitive drive advantage, things broaden process automation not just for people but also bringing robots in to play a vital role. And stuff around data analytics, coming to drive the competitive landscape for different sectors. So, these are things I think would continue just like 2021. But I see more standardisation regulatory stuff coming into help to ensure that we have a stable system soon.
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Toyosi Boyejo
Let’s talk about BPA. That’s the Business Process Automation. What would you say about the incorporation or integration of BPA in 2022 for businesses?
Henry Ogbu
So clearly, we are aware that automation is inevitable if you will survive. BPA and RPA; are the significant technologies driving that sector before bringing in AI on top of it and machine learning. But for BPA, we’ve seen a lot of successes in the financial industry, verifiable achievements in terms of people that have embraced it and implemented it for different use cases. But then also we saw some failures at the same time in implementing this technology, which demonstrates the fact that technology is an enabler. Technology will not correct a broken system. So we see that people need to get their processes right before you begin to look at what RPA, BPA, engines, technologies, and frameworks would help you do. So, if you have a broken system, then implementing this automation will worsen it and create more frustration. In pcl., we usually start with process optimisation before implementing our RPAS and BPAS. And that’s what we advise companies to do.
And we look forward to a lot of this happening this year and then the subsequent years.
Toyosi Boyejo
Let’s talk about Business Process Automation. So as an expert, I would expect you’ve implemented some of these processes for your clients. What would you say are lessons learned from the proper and wrong implementations? What are the lessons learned from these experiences?
Henry Ogbu
Thank you. Again, this is a very important question, and I think this is the question in the mind of everyone because we’ve seen some processes and some failures at the same time. And why it is difficult to pin all to one issue, I think it’s worth noting that we discovered that the ones that succeeded are all about strategy. It’s all about process optimisation. And the ones that field is also replicating your problem.
All right, so that wouldn’t provide any advantage for you, okay, so now the first thing people will need to look at when it comes to optimisation is what you want to optimise or what process you want to automate? So, what is the process? How do you know what to automate as a process? Okay, so these are the analysis that must happen to see where you have values and what to automate and what not to automate. What are the priorities, what should come first, what should go next? There’s an entire value chain for every organisation in terms of automation. So that diagnosis needs to happen, and then the design must happen. It’s all about creating value.
It’s not just about automation but the value it creates for the business, and this is what we do as Phillips Consulting to help organisations get it right. We come from that area of looking at a diagnosis of the organisation and then their processes and then moving to optimising the techniques that need automation. From that point, we’ll take it down.
Toyosi Boyejo
Okay, so here you’re speaking about the wrong implementation. So, what you’re saying is a reason or a problem, or what can cause the incorrect performance can be a flawed process or lousy strategy. Is that what you’re saying? Because I know you mentioned design and process optimisation.
Henry Ogbu
We would not say the strategy would be a problem, but the processes, this is what you’re automating. All right. So, if you have an inefficient process or a very flawed process, automation will not make it better. So that’s where process optimisation is critical before you begin to automate.
Toyosi Boyejo
Okay, so we will do a quick throwback to 2021 during the pcl. future work webinar, one of the consultants I’m quoting; the consultant mentioned that the organisations that win would be those who choose exploration over exploitation and innovation over business as usual. Can you say we have had so many winners in the last two years?
Henry Ogbu
Yes, certainly. I mean, the data is out there for everyone to see and the sectors that won and the ones that lost. We can conclude that money didn’t disappear in the last two years. What happened was that money moved from a different sector, different organisation into another one, what organisations with exploitation methods or models lost were gained by the organisations that are tailored into exploration. For instance, we look at the Flutterwave, the third unicorn fintech coming out of Nigeria. They just joined the likes of Interswitch and Jumia. What is interesting about Flutterwave is that they made this stride or accomplished this stride in five years, which is unprecedented. That is a typical company that is into innovation and exploration. And you can see it. And recently, we found out that they’ve already closed a $250,000,000 round of investment which has moved them to a valuation of 3 billion. This is within the space of a couple of months apart. That clearly shows that that premise is accurate. Not only is it accurate, but people need to look at it very carefully.
This is the truth. I’m going into the future. These models will determine who will survive or who will fizzle out.
Toyosi Boyejo
I’m going to be asking this year, what do you foresee those businesses will invest in technology? Initially, for 2021, you mentioned the likes of BPA, cloud computing, collaborative tools, and the like. So, in 2022, what do you foresee those businesses will invest in technology?
Henry Ogbu
Technology is very vast, horizontally and vertically. So, it isn’t easy to pin a particular type of technology into what people will invest in. However, when you look at it, it depends on the organisation; you know a different organisation has its strategies. Secondly, you look at their maturity as well. So that would determine where their money will be going into. But from a general perspective, you also look at the things that must help people to work, have a hybrid kind of work. So collaborative tools will keep on being out there, being a choice investment because you must work. Like Rob Taiwo mentioned during the Webinar, quoting him now that “work is not where you go but what you do.” So that tells you that there’s already a shift, and investment is already being pushed in this direction. Okay. And again, process automation, we can’t say it enough. Automation will keep ongoing. All right? While some people are at the business process automation level of some of their mundane tasks, we’ll see definitely, or we are seeing investment going into robotics right now. All right? Not only in the financial sector but also in manufacturing.
The mundane work that people do will be moved to the robot. Imagine where a company has an IT department, and 30% of their work is on password change for clients, helping clients, and helping their internal system do password change. This is 2022. That kind of work shouldn’t be what a human being should be doing. Robots should be doing that. And we will see a whole lot of that kind of level of automation going on and an even more sophisticated business model being automated going into the future.
Toyosi Boyejo
Trust architectures can include distributed ledger technologies like Blockchain and zero-trust security approaches to preventing data breaches. Do you see Blockchain being a prominent part of technology?
Henry Ogbu
Toyosi, what is going on is that globalisation is natural and inevitable. All right? So, in the next few years, we will only recognise countries or regions in the maps. Boundaries will no longer exist in business and commerce. We are talking of Blockchain and trust architecture and open architecture to make this work. And this is what Blockchain smart contract is supporting. So, we will see, it has already started happening, where people here in Africa will do business or invest or do the transaction with another continent. All right? So, with Blockchain, you do not need to trust. You do not need to be afraid of being tricked or losing your money because this technology ensures that whatever the agreement is, the system takes care of it and knows nobody, no emotions. All right? The system will handle it. So, globalisation will be driven majorly by Blockchain and AI. Okay? So, this technology has come, and it would keep improving, cutting across different sectors, not only the financial industry.
Toyosi Boyejo
So now tell us about the use of artificial intelligence in the industry.
Henry Ogbu
Okay, yes, we have significant use cases—an application of AI in the financial services sector. However, if you say how much adoption has happened, there is not much because I think it’s infancy at this stage. The reason is not far-fetched because AI is entirely dependent on data, talking about quantity and quality. So, what we see here is why we may have so much data, the quality of the information is another issue altogether. So, we require a good quantity and quality of data for AI to produce the business value for which it was released in the industry or whatever it is promised in terms of business value. And we are seeing this happening, but not so much of it now. Still, with cloud computing taking centre stage now, we will see data synchronisation. We’re going to see more AI implementation taking centre change in the businesses and the organisations.
Toyosi Boyejo
How significantly did supply chain disruption impact technology services and delivery during the pandemic, and how did the organisation address it?
Henry Ogbu
I think it’s an essential question, and I believe we are all experiencing it one way or the other. Some people don’t even understand what you’re talking about, but then when we look at inflation today majorly, it is a result of broken supply. But what was interesting this time, the supply chain got disrupted from the demand side and the supply side. Usually, you have one of these things happen, but it happened on both sides simultaneously because of the pandemic. People could not go to work to produce some of these, whether a finished product or a product for the finished product, people couldn’t go to work. So, you have a shortage in supply, and at the same time, you’re having a massive demand because people have to make use of this thing. So, on both sides, the world was hit, affecting everything. Inflation is global. It’s not a one-country affair, and that is a disruption in the supply chain. What I see, the recommendation of what we’ve seen people doing right now is to rethink their supply chain strategy. One of the things people are doing right now is to create more avenues locally and internationally, creating more options so that if there’s a problem like we saw last year in international markets, you can leverage your local supply and the same thing if it’s happening locally. So, this is the strategy so many companies are now adopting to create that diversity to cushion the shock. The next thing that’s going on is that people are looking at providing a buffer in the inventory, inventory management – optimising their inventory management. This time around, looking at the data to know when to make more orders, to have a kind of a surplus, but not an excess of plenty because that would be a problem but creating a healthy buffer for these items. And I think the last thing I want to say also is that for a mature organisation that is into sensitivity analysis of their supply chain parameters, some of these organisations that use AI are looking at checking the parameters that control the supply chain, simulating and looking at okay, if I move this, what will happen to this site and all that?
So, it’s a more complex exercise, but that’s what people are doing today to make sure that their business is future-proof.
Toyosi Boyejo
You seem to have mentioned financial institutions a lot of times. They seem to have been one of the major players in adopting technology, and I want to believe that it shouldn’t be limited to just these companies within that industry – that’s the financial industry. So how do we sell this to various companies across sectors on the use and need to adopt technology? For example, during the pandemic, I’m sure not only banks needed technology for their business continuity other companies also required it. But how do we sell it more, or how do we make businesses see the benefits and importance of this moving on?
Henry Ogbu
I think it’s all about education to go straight to the point. There must be education. People need to see the value of technology to their business. There must be more education more engagement across other sectors, not only the big organisations. Talking about even the small and medium enterprises, there’s so much technology can do to help them be at the cutting edge and be competitive in their own space. So, there will be a lot of engagement and education in this line.
Toyosi Boyejo
Okay. Thank you so much, Henry. I mean, it was insightful. Thank you for being here. Thank you for sharing this with us, and I’m hoping that business leaders will look into this; they will adopt this and, of course, get educated to know the value of what they’re integrating into their businesses. Thank you so much. So good to have you here.
Henry Ogbu
My pleasure Toyosi. Thank you.
Toyosi Boyejo
Thank you for being a part of today, and I trust that the session was quite insightful and informative. Do follow us on our social media platforms. Bye.