Big Bank Experiments With Artificial Intelligence

Description

Florence Smith, CEO of Millennials Bank, was heading towards the board meeting where the directors of Big Bank (owner of Millennials Bank) where going to review the results of the newly created Millennials Bank, a digital branch of the main bank which targets the millennial generation. This initiative also serves as a pilot on how to make the bank a more dynamic entity. However, despite high hopes for change, the new digital bank is so far not meeting expectations. After six months of operations, it is still operating with the same structure as Big Bank, while the competitive pressure from other banks that are also pursuing digital strategies is increasing. The tailwind given by the big launch marketing campaign is running out, and Millennials Bank is beginning to leak customers as the promise of a purely digital bank is not being fulfilled. Florence has recently been appointed CEO of Millennials Bank in order to turn the situation around. Florence is eager to implement a lot of initiatives in order to improve towards operational excellence and revert the decreasing margins. She has been pushing to start introducing new technologies into the bank, specifically artificial intelligence. Florence thinks banking should be no different and it would be important for Big Bank to be the first to transform into an AI bank, being the Millennials Bank the perfect place to test these new technologies. However, much work needs to be done in order for this to be possible. At this moment, Millennials Bank lacks the staff, know-how, and infrastructure to implement ambitious AI initiatives. Michael Perry, the CIO of Millennials Bank, has been suggesting that they instead focus on existing analytics technologies since he thinks there were opportunities that can be identified without any additional investments or trying out untested technologies. Given the weakening competitive position of Millennials Bank, they have to react quickly. A steering committee has been established to oversee the transition of Millennials Bank into a full digital-first, AI-driven experience, led by Florence as CEO. This committee will meet every quarter in order to decide the actions of the bank. The committee will have control over the bank's commercial activity (interest rates, ATM rates, savings account rates) and main budget lines (marketing, customer support, data), while deciding on the projects and initiatives that will be carried out each quarter in order to further the bank's digital strategy. These can range from acquiring the needed capabilities to final implementations of AI banking solutions, all of which will be funded by the budget allocated to data management. Besides financial performance and market information, Florence will be briefed every quarter on the state of the bank's digital infrastructure, and also how the bank is performing in regards to fairness, accountability, transparency, and ethics.

Learning Objective

To understand through a simulation process the different initiatives and actions that should take place in an organization to implement Artificial Intelligence as an integral part of the business model of an organization.

Related Documents

• Big Bank Experiments With Artificial Intelligence - Millennials Bank Simulation Overview
• BIg Bank experimenta con la inteligencia artificial - Resumen de la simulación
• Big Bank Experiments With Artificial Intelligence - Teaching Note

Keywords

Accountability Artificial intelligence banking Capabilities Data management ethics fairness female protagonist machine learning Models Transparency