TECHNOLOGY Discovery, which is using telematics and predictive models to link driving behaviour to determine the likelihood of claims and pay-outs.”
Cryptocurrency “The most relevant example is blockchain, with Bitcoin being the most famous example. It is about info that needs to be trusted, that is stored in the cloud and cannot be messed with. All South African banks are doing proof of concept on Bitcoin. They don’t want FinTech companies to eat their lunch, but it is also an offensive move as the banks can explore working without their current big in-house systems. A prediction from the end of last year was that large financial institutions would spend $1 billion on blockchain in 24 months.”
Robotics “There are two different stories. The industrial application of robotics is not new. But now we can use AI in robots, like Baxter from Rethink Robotics, and show it what to do at a production line. It can learn, which
is very cool. The cost of one Baxter is just below minimum wage in the US. We are also seeing robotics at a digital level, which can revolutionise customer service as robots can be used in chat boxes and call centres.”
Virtual and augmented reality “We all know this now from Pokémon GO. The most exciting aspect of this for business is augmented reality, whereas virtual reality is very much aimed at gaming and entertainment. With augmented reality you can walk into your warehouse with special goggles on, linked to your ERP system, and see how old your stock is. Engineers can see which part of a machine is going to break next when they use their goggles.” “Today, the key challenge is the data deluge, especially when you work with data from outside your own organisation,” says Frank, when asked how CFOs should deal with all these trends. “Executives need to filter what is relevant. When describing the properties of data & analytics, experts talk about the three Vs: volume, veloc-
ity and variety. From the beginning, KPMG has added two other Vs to that: value and veracity. There is also a lot of rubbish data around and you cannot rely just on Twitter feeds. You need to be asking the right questions and be able to test the data and you need people who have the technological background, understand the data cycles, but also understand the business. That is still quite difficult to find.” Finance departments need to transform to deal with the changes, says Frank. “The CFO needs access to different skills. Younger people who have grown up with a different mindset can gather information from many different sources and analyse data on the fly.” Good external advice is also crucial, with KPMG offering a package that not many can. “Our biggest asset is our multidisciplinary approach,” says Frank. “For a number of clients, we have been able to use data & analytics to look at their tax and find savings, for example. Tapping into the skills from our different departments is what sets us apart from other big firms.” l
Beware of the cyber threat The prevalence of cyber threats is forcing companies to make tough decisions quickly, otherwise they stand to lose direct control of data security, writes Nathan Desfontaines, KPMG South Africa’s cyber security manager, who is speaking at the Finance Indaba Africa 2016. “Businesses need to move away from believing that cyber security is a point-in-time exercise – a fad that is ‘hyped up’ - or that the threats of cyber-attacks will go away. When it comes to protecting businesses’ information from potential cyber-attacks, businesses need to understand what their ‘crown jewels’ are. By knowing what the business has and what it is worth – both to the business and to outsiders – only then will the business gain a better understanding of what information needs to be protected. Trying to achieve 100 percent security across all facets of the IT estate is a challenge and is bound to dilute the focus, which should be on the critical information assets of the business.” “Aside from a possible legislative or regulatory financial impact on a business as a result of a cyber-attack, businesses are becoming increasingly concerned around both the financial and reputational impact to their operations and their environment." “Although breaches do not always directly affect revenue or stock prices, businesses must also consider other possible effects of a compromise to their information assets. For instance, some attackers are driven by direct financial loss to the business or financial gain to themselves, whereas other attackers are motivated by a reputational agenda and building a name for themselves. Others simply enjoy the thrill of testing their ability without a particular agenda or malice in mind.”
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