The vote to leave the European Union brought with it a wealth of uncertainty, for both businesses and the general public, slowing the economy as a result. However, the March 2018 Economic and Fiscal outlook from the Office for Budget Responsibility (OBR) showed a growth in productivity since November – much stronger than predicted.
The OBR figures don’t come as a surprise. Research by Reed Accountancy & Finance has shown that UK finance businesses are investing more in growth, including recruitment, than this time last year, symbolising the growing confidence of the industry.
We asked more than 500 UK finance professionals about their performance and investments in the past year. Almost one-third of businesses (30%) reported a much improved business performance year-on-year, reflecting the figures from the OBR and justifying the sector confidence. Understandably, this is also encouraging for businesses to invest, and when a few businesses invest in recruitment, so do others in order to maintain a competitive edge.
Time to invest
For a significant number of businesses, there is a clear tendency towards turning this optimism into investment with a significant percentage committing funds to all areas of their business to improve, progress and attract the best talent in the sector.
With talk of the fourth industrial age and AI taking and making jobs, the opportunities to invest in people and tech to improve a business have never been more prevalent. As a result, many businesses are investing heavily in technology. However the finance industry is predominantly a people industry, and emotional intelligence is something that only humans can bring to the table. As such, striking a balance and remembering that one complements the other is vital.
What are the right areas for investment?
In recent times, one of the major concerns has been the UK’s issues around productivity. The UK government has previously been heavily critical of low productivity levels in comparison to other countries. In order to address this, almost half (45%) of businesses involved in our survey have invested more in improving productivity than at the same time last year.
As a key part of this investment in productivity, there must be an investment in people and technology. And significant numbers of professionals are seeing investment in both of these areas.
More than a fifth (21%) of businesses questioned said their organisation is investing in new staff and training. Training, as well as initial recruitment, is certainly a key area for investment.
From our work with jobseekers, we know that being attracted to joining a company isn’t just about money. Jobseekers are increasingly looking long term and there is a real feeling that in order to stay valuable they have to modernise themselves and upskill.
If a company has a clear training path, the chances of attracting a new recruit of the current generation is improved. It is very clear that the onus of development is not just on the employee – the employer must facilitate this progress as well, and that fifth of companies are clearly wise to this.
As part of achieving the balance between people and technology, there are a significant number of companies preparing for the modernisation of the sector with a quarter (24%) investing in new technology, systems and machinery. As a greater volume of programmes to carry out day-to-day tasks flood the industry we believe this investment will be more common, but there is always a place for the business that offers a personal service which gives time to their customers.
How do we prepare for AI and robotics?
While the investment in AI is ongoing, robot-enabled professional services will be key in the future. This means it is inevitable AI will become more prevalent within our industry over the next 15 years. Although the implementation process of AI and robotics technology is lengthy and costly, it is important that organisations embrace the technological revolution, rather than fear it.
The key is to see that the functional capabilities of AI and robotics are there to relieve employees of simple administration duties, instead focusing their efforts on gaining commercial value. This is clearly providing a benefit to enhance performance rather than a threat.
Admittedly, there are cases in other sectors where AI and robotics have replaced some roles, and there will be cases like this in finance. However, where some roles are replaced, others will be created. For example, while robotics has the capability to report and summarise accounts, naturally replacing some transactional level roles, humans will always be required to operate and develop this innovative and complex technology.
Having a strong understanding of how this technology can work effectively and streamline processes, along with varied experience and strong people management skills, will help employees become indispensable during this period of change. And there is always going to be a need to develop this technology, so those that have the experience to ask the questions that lead to better AI will be vital.
Looking forward to the future
With businesses growing more confident and a boost in the UK’s level of productivity, it’s imperative that businesses plan for the future and invest to put themselves ahead of the competition.
In order to do this, securing the best talent will be crucial. This includes new talent coming into the workforce, such as Generation Z. This is where investment in both people and technology will be essential.
As our research shows, businesses know that investing now is imperative to the future of their company. Bringing in the talent that can further the business must be matched by bringing in the technology that can assist and develop the talent.
Quite rightly, businesses are not intimidated by technology, they are embracing it. And those jobseekers that do the same will thrive as a result of their ability to utilize the future technology.
That future will, obviously, involve Generation Z and the way that they work will continuously improve existing technology to maximise effectiveness and streamline processes. From what we’ve learned already about this generation, they will naturally be attracted to organisations who have already shown a commitment to investing in up-to-date technology.
The key for future investment is not that successful businesses invest in technology to streamline and replace people, rather, they should invest in technology which attracts the best talent giving employees time to do what they do best and grow the company.