Category Archives: Artificial Intelligence

[ Note: This article was published on Linkedin more than 6 months ago. Here is the original link to the article ]

[ Update (Apr 13 2020): Amid the COVID-19 pandemic and restricted movement globally,  we can turn our pessimism into an opportunistic one ]

Nature has a way of teaching us. What works and what doesn’t are often hidden in plain sight, but we human are mostly too occupied to notice the things that work.

Why are they not spending?

This news appeared in my LinkedIn feed. It read “Malaysian Banks Don’t Spend Enough on Tech“. It irked me immensely because in a soft economy climate (the low tide), our Malaysian financial institutions should be spending more on technology (reaping the opportunity) to get ahead.

Why are the storks and the egrets in my page photo above waiting and wading in the knee-deep waters? Because at low tide, when the waves ebb, food is exposed to them abundantly. They scurry for shrimps, small crabs, cockles, mussels and more. This is nature’s way.

From the report, the technology spending average among the Malaysian banks is pathetic.

The negative domino effect on SMEs

When the banks are not spending on technology, the other industries, especially the SMEs (small medium enterprises) follow suit. The “penny pinching” and “tightening purse string” effect permeates across industries, slowly and surely putting the negative effect in tech spending into a volatile spin-cycle.

From a macro-economic point of view, spending slows down. Buying less means lesser demands and effectively, lowering supply, and it rolls on. The law of demand and supply just got dumped into an abyss.

A great opportunity for those who see it

When I was an engineer at Sun Microsystems more than 2 decades ago, I read a comment delivered by one of the executives. It said “When times are bad, those who know will get the best parts“. I took his comment to heart because what he said held true, even until today.

This is the best time, when the country is experiencing an economic downturn. When the competitors are holding back and may be reeling from the negative effects of the economy, the banks are in the best position to grab the best deals. This is the time to gain market share, when the competition is holding back for fear that the economy will become softer.

Furthermore, with the low interest rates across the board, there is no better time than the present to step up the tech spending. Banks should know this very well but I am perplexed.

That is why the Malaysian banks must kick start their tech spending campaign now. And the SMEs will follow, overturning the downturn with demands of spending for the best “parts”. The supply “factories” are fired up again, and will lead to a positive growth to the economy.

Bank Negara RMiT is that one opportunity

One thing which has been looming is Bank Negara, Malaysia’s Central Bank, RMiT (Risk Management in Technology) framework. A new version was released in July 2019, and to me as an outsider, is a great opportunity to grab the best parts. And some of these standards will come into effect in January 2020

Bank Negara is strongly encouraging banks to improve the security and the confidence of the country’s financial industry, and the RMiT framework is really a prod to increase tech spending. Unfortunately, in some of my business interactions with a few of the banks, the feet dragging practice is prevalent.

Nature’s lesson

The best time to have your best pick is at low tide. This is nature’s lesson for us. What are we waiting for?