Digitalization is becoming paramount in the financial sector. Using hybrid robo-advisors has facilitated attending the customer needs. However, it is evident that the collaboration between human and robotic workforces is a multi-step process. 

A few years back a major American retailer pulled the plug on a $125 million enterprise IT software implementation. In retrospective, it appeared that the employees that had to work with the system did not understand how to use it next to their daily tasks and routines. Eventually, this led to a corporate decision to stop the project and accept a $125 million write down. Imagine if this scenario would occur in your organization and picture how this could harm your organization’s business. What can be done to prevent this from happening? And how can employee acceptance of new technologies lead to value creation for your customers?

In the financial services industry, customers continuously demand transparency of financial possibilities, low-cost accessibility to financial services, and increasingly digital experiences. Banks are responding to these needs by starting to implement hybrid robo-advisors in the customer journey. Aside from the known advantages of hybrid robo-advice, it is evident no superior services will be delivered if the human workforce is unable to collaborate with the robotic workforce. In other words, human advisors must know how a hybrid robo-advisor changes their role and responsibilities. Hence banks should focus on thoughtful implementation taking their workforces’ needs and concerns into account. This article takes you along the challenges regarding workforce acceptance of hybrid robo-advisors and presents a roadmap to facilitate an implementation.

The Importance of Workforce Acceptance

The financial sector is heavily regulated which does not allow for technological change to happen overnight. However, the changing customer needs and regulatory changes such as PSD2 are forcing financial institutions to innovate their customer journeys to comply to future standards of banking. To comply to these future standards, banks should focus on optimizing the implementation of robo-advisors. Currently, banks are slowly starting to automate routine services and are increasingly providing online round-the-clock service with hybrid advisory services.

There is no unilateral answer to how robo-advisory services affect the tasks and routines of the workforce. Moreover, visions of automation in banking are scattered in the banking landscape. Some relatively conservative banks continue to emphasize personal contact and advice using human advisors to drive value. Contrarily, other banks adopt a more progressive vision by using robo- and human-advisory services next to each other. Current Accenture research indicates that the market is not ready yet for full automated robo-advisory services and that the customers need for the human touch in financial advisory will not disappear anytime soon. Therefore, focus on ensuring human advisors are enabled to work with a robo-advisor rather than against is essential. Incorporating Change Management in the implementation approach is key to accomplish this.

The Workforce Paradox

The implementation of new technologies is accompanied by an interesting workforce paradox. It is a sure fact that frontline financial services are shifting towards automation and digitalization and that workforces see the need for process optimization with these new technologies. However, the implementation of a new technology could lead to job insecurity and uncertainty regarding redesign of their tasks and routines. This paradox demonstrates the workforce’s discomfort ability for new technologies on one hand, and the positive stance towards new technology on the other hand. The paradox is also present at the managerial level. Management sees the need for and value of process optimization, but heavy regulation of the financial sector and workforce uncertainty forces managers to adopt a careful approach towards changing internal processes.

Managing this workforce paradox is a complex process that requires expertise in Change Management, stakeholder engagement and strategic planning. Accenture’s experience teaches us that such projects generally are concerned with at the least the following two challenges:

1. Emphasizing the Human Aspect of Automation

At Accenture, we involve the workforce in the implementation by focusing the Change Management activities around: discovering the root causes of uncertainty; describing how change can be realized; co-creating the change together with (a delegation of) employees; scaling change activities that are proved across the organization; and making sure that the change sustains in the organization after the implementation has ended. A large part of the uncertainty of the workforce can be taken away by emphasizing on the human aspect of digitalization in the early stages of the implementation. Showing how new technology leads to more attention to the human aspect in the organization increases the involvement and engagement of employees and triggers a value-based conversation. Employees share their concerns and the causes for are assessed. Leveraging a change network of composed of different employees from different hierarchical levels and backgrounds facilitates the co-creation approach and lasting change is effectuated together with this network.

2. Cultural Change Programs

Digitalization and technology implementation requires a different approach on how organizations engage employees, human resources, and corporate management and subsequent behavior. To realize facilitate this, cultural change programs have proven beneficial. Over the years, our experience with change management and implementations has shown us that an organization’s performance only increases if the organization is involved at all hierarchical levels. Cultural change programs generally involve goal setting and strategic management, meaning that the implementation of the new technology is not a goal on its own, rather a vehicle to achieve the strategic ambitions.

Needs Interests Concerns Expectations

A NICE Roadmap Towards Implementation 

Knowing the challenges concerned with implementing a new technology such as a hybrid robo-advisor, it is essential that organizations identify and articulate the context for the implementation. To do so, corporate management should know what is going at all organizational levels and the market trends, including its forces on the organization. The context in which a new technology is implemented can be defined by identifying an organization’s NICE:

  • Needs – Organizations should define how they need the workforce and the hybrid robo-advisor to work together to achieve the strategic ambition. This can be done by clearly defining a clear vision on why a hybrid robo-advisor is implemented, how the implementation changes the tasks of the workforce, and how the workforce should collaborate with the robo-advisor;
  • Interests – Organizations should define what they want to achieve with the implementation of a hybrid roboadvisor and what the benefit for the internal organization is. By defining what is at stake for the organization, management can develop a vision on how the robot-human collaboration could potentially harm or improve their workforce’s tasks and motivation;
  • Concerns – Potential pitfalls should be identified and where possible eliminated. All impacted levels in the organization should be given the chance to express their feelings and perceptions regarding the transition. Mapping the employees NICE and responding to them pave the way for workforce’s acceptance of the implementation of a hybrid robo-advisor and willingness to work together with a hybrid robo-advisor;
  • Expectations – Finally, the organization should understand and manage expectations constantly to prevent unexpected events to happen. Getting surprised with unexpected events could potentially harm the workforce-robot collaboration.

 

The Next Step Is Solving the Workforce Paradox

The implementation of a robo-advisor changes the customer journey of a bank and could positively impact customers experience. Accenture’s experience has taught us that successful implementation of a new technology is directly influenced by the workforce’s perception of this new technology. There are challenges on the road towards workforce acceptance that must be managed accurately. Accenture’s cultural change programs and implementation roadmaps are tools that help organizations manage these challenges and push the benefits of a new technology towards its maximal potential. Moreover, emphasis on the human aspect of automation and cultural change programs will show that technologies are an asset rather than a threat for workforces. Efficiencies and availability will increase, and customer assistance will be more dynamic and personal. If organizations succeed in engaging their workforce, the workforce paradox will be a phantom of the past.