The global pandemic lockdown has given most of us a time-out that allows us to step back and reconsider a variety of situations. My mind went to scenarios for securities operations, and here are some of my musings on what-if scenarios that could pave the way for permanent changes, once we get to a new, safer normal:
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Arvind Krishna
First, I will piggyback on a what-if idea put forth by IBM CEO Arvind Krishna at the IT giant’s Think Digital virtual conference this past Tuesday.Basically, Krishna is suggesting this time of crisis may become a catalyst for many companies to truly consider a real digital transformation rather than a lot of lip service. “There is no question that this pandemic is a powerful force of disruption and an unprecedented tragedy,” he said in his keynote address. “But it is also a critical turning point. It’s an opportunity to develop new solutions, new ways of working and new partnerships that will benefit your company and your customers, not just today, but for years to come.” I think financial services firms will get on board after what they have experienced during the pandemic lockdowns.
- Another one of my what-if scenarios focuses on manual processes and manual systems. In particular, is it possible that the crisis caused some manual processes and systems to go away for good? Did the twin emergencies of working with staff and clients remotely cause firms to bite the bullet and embrace automation that they have been putting off? The other truth is that the partially manual systems may have worked remotely, if with great difficulty. My hope is that firms found an easy way to get around their manual loops and bottlenecks. I hope an IT innovation or two helped them out of tight spots.
- Yet another what-if thought is whether back-up sites for middle- and back-office operations may be replicated via virtual basements, garages or dens for future business continuity planning/disaster recovery (BCP/DR) strategies. Traditionally, disaster recovery back-up sites were recreations of trading floors, support offices and more that were fully functional as long as staff could get to these safe places. With the pandemic, it is fair to ask if staff members should just work from home with the highest levels of security in place. It might be a new, more affordable era for BCP/DR. It would require a major commitment to cyber-security protection.
- Before I dive into this what-if scenario, I have to acknowledge that I love a good dystopian science fiction story be it in book form or via a screen of some kind. So, what if in the ne
ar future, highly advanced robots take algorithmic/advance electronic trading to the next level and completely replace human traders (and maybe managers)? In that imaginary world, the robots could be trained on the latest rules, regulations and guidelines and would be programmed to stay within the law or alert their human masters that they were about to transgress. They would also be trained to be very respectful of the Ops staff. I think investors and regulators would like it — if no one else does. Of course, robots equipped with machine learning and neural networks could learn how to cheat the system and outwit regulators better than any human. They might also enslave Ops staff members. That would not be an optimal what-if scenario.
Thank you for letting me indulge in my lockdown what-if scenario musings.
Feel free to share your what-if scenarios/musings with me.
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