Samaha Associates

e-Business and Technology Consulting Services for Financial Institutions

Quality Service With Results

1st United Services was in the midst of a credit and debit card processor conversion in 2012. The conversion proved to be quite complex, and we were beginning to have concerns about its success. Samaha Associates assisted in addressing our major concerns, and also helped us renegotiate pricing. I would highly recommend talking to Samaha Associates prior to entering any major conversions or contract negotiations.

Steve Stone, Chief Financial Officer
1st United Services Credit Union, Pleasanton, CA

About Us

August 2017: CUtoday Publishes CEO Sabeh Samaha's Op-Ed: If You Care About Your Employees, Think About This

If You Care About Your Employees, Think About This

 

By Sabeh Samaha

How soon will artificial intelligence replace American jobs? How many jobs will be lost and what will happen to both skilled and unskilled workers left in the wake of AI and robotics?

These questions are keeping many people up at night. In fact, according to a June 6 report from online education site Udemy, fear of losing their job to AI is the number-one trigger of stress inside the workplace. And, 60% of respondents said they feel stressed at work most of the time.

As a leader, this should concern you even if your job isn’t in danger (so far), because it affects the ability of your employees to provide service to your members. At the very least, everyone should be concerned about the social unrest that could result from so many people unable to find employment and feed their families.

Chilling Observation

I recently discussed this issue on a flight with the man seated next to me. “What will happen to all of these displaced workers?” I asked. His response chilled my blood: “They’ll just die out. Survival of the fittest.”

To me, that’s unacceptable. And if you care about your employees, that should be unacceptable to you, too.

Like the forecasted demise of cash, checks and plastic cards, AI probably won’t replace jobs as quickly as some are predicting. Secretary of Treasury Steven Mnuchin said in an interview that AI’s effect on the economy isn’t even on his radar screen. Moreover, he believes the displacement is 50 to 100 years or more away.

On the other end of the alarm scale is Stephen Hawking, who predicted AI will destroy middle class jobs and accelerate economic inequality worldwide. It is inevitable, Hawking said, that these platforms will enable small groups of individuals to make enormous profits while employing very few people, and he predicted only the most creative and highly supervisory jobs will survive. At worst, Hawking envisioned a world in which movies like The Terminator and The Matrix play out in real life, with AI evolving faster than humans and eventually orchestrating their demise.

Like all things, the truth is probably somewhere between those two extremes.

What the Studies Suggest

In an attempt to quantify the inevitable change, a joint report prepared last year by Citibank and the University of Oxford estimated 47% of U.S. jobs are at risk of loss to automation. A separate Oxford study reported the U.S. is at greater risk of job losses compared to other countries, because so many service jobs are highly susceptible to computerization. The service industry is where most of job growth has occurred in the U.S. in recent times as we’ve increasingly outsourced manufacturing.

High-skilled jobs, particularly in the financial industry, are at a lower risk of being replaced by computer intelligence, Oxford said. However, that same report included a probability chart of jobs most likely to be affected by automation. At the top of the list were loan officers with a 98% likelihood. Jobs that focus on collecting and processing information are also likely to be affected, the report said, which will also impact lending. Also on the list were financial advisers and computer programmers, with much less probability of job loss, around 50%. But tell that to someone whose ability to provide for their family have the same odds as a flip of a coin.

Compliance is another area that will be reshaped by automation, because it involves data that must be checked against rules, something computers can be programmed to do efficiently and effectively. Humans must still investigate the automated findings, which only report the likelihood of fraud or rule-breaking, but even the NCUA is moving toward virtual examinations. Federal employee positions have traditionally been more stable than those in the private sector, and even they face AI disruption.

The Answer? Not More Education

Interestingly, Oxford – a higher learning institution – said more education isn’t necessarily the answer. Jobs that are least susceptible to automation involve thinking and problem solving, originality and/or performance, and unpredictable personal interactions. That means workers must acquire creative and social skills, which aren’t traditionally taught in a classroom.

Emotional intelligence will become as valuable, if not more valuable, than an advanced degree.

Transforming your credit union into an organization that embraces automation while providing high-touch service and providing good jobs in your community may seem daunting, but it also inspires ways your organization can re-emerge as a financial services market leader. The solution lies in creating new products and services that provide individual attention, creativity and social interaction.

One such possibility is the development of financial coaching programs, which can work with technology, rather than against it. Coaching jobs in other industries, such as fitness and executive development, are on the rise. They are expected to withstand challenges from automation, because they require all the traits mentioned above: problem solving, originality and personal interaction. Why not apply those qualities to create new positions while also increasing loyalty and market share?

Increase in Demand

Technology advisory consulting services, including project management, which my firm provides, is also experiencing an increase in demand. Analytically-minded employees with good organizational skills and attention to detail could be retrained to assist in technological upgrades, implementations and training. This is another example of how you can help employees work with computers, rather than against them.

As big financial institutions embrace automation to increase profits, service could suffer. Automated loan approvals – and denials – may swell the ranks of the financially underserved. These trends provide an excellent opportunity for credit unions to differentiate themselves in the marketplace and appeal to middle class consumers, while also saving your humans from the machines.

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