Sergey Kravchenko - Fotolia
Almost three-quarters of professionals in the financial services sector expect demand for board-level IT executives to increase as firms battle to keep up with tech advancements in the sector.
A survey of more than 500 professionals at investment companies, carried out by administration service provider Intertrust, found that 73% expect a surge in the number of chief technology officers (CTOs) on the executive boards of companies in the sector.
These CTOs will be tasked with driving business change through technology. The survey found that 29% of firms were struggling to keep pace with tech disruption in the sector.
Most firms will have a CTO with a mandate to drive strategic change by 2023, according to 40% of those surveyed. Blockchain, artificial intelligence and robotics are the technologies these CTOs are expected to harness.
Intertrust CEO Stephanie Miller said increasing numbers of CTOs would emerge within the financial services sector, with a clear mandate to drive change.
“With many firms struggling to keep up with the latest developments in emerging technologies, let alone seek a competitive advantage, the question will increasingly become when, rather than whether, to make new senior hires to devise the right strategy and implementation programme,” she said.
Read more about the technology transforming the finance sector
- Finance firms must keep a close eye on artificial intelligence, according to the Financial Stability Board (FSB), an international body that supports financial services regulators
- Economist Intelligence Unit survey shows nearly three-quarters of businesses think retail banking could be mostly automated by 2020
- Blockchain as a term is becoming common language, but there is a long way to go before it will mean anything to the performance of most organisations
Miller said companies that delayed board-level CTO appointments could lose out on the best candidates and fall behind competitors that have been quicker to recruit.
“Given the competition for technology leaders from sectors outside financial services, as well as their own, the necessary skills, particularly in high-demand areas such as AI [artificial intelligence], regtech [regulation technology] and compliance, are not always in ready supply. With the gulf in performance between digital leaders and laggards growing rapidly, firms can’t afford to be too complacent about their place in the technology revolution,” she said.
The skills that are in short supply in the sector, according to the survey, are in AI, regtech, data analytics and cyber security.
The consequences of failing to keep up with technology in the finance sector, known as fintech, could be stark. Gartner recently said some firms would go out of business or become commoditised, while others would continue to exist but be uncompetitive because of the rise of fintech.
Gartner said fintechs, as well as other companies entering the financial services sector, are changing the business models and economics of the finance sector. This new landscape will require leaders with the right mix of business and technology understanding.