With lockdown, many of us have transformed how we work, shop and use services from companies. As a result, and also through necessity, there has been widescale digital implementation and adoption. New habits have been created for employees and customers alike.

One good example of this is the workplace. For those that can work at home, what was previously office based interaction, has now turned into digital interaction, including lots of video calls.

The digital dividend

Although the technology has been around for a while, we seem to have now discovered the great benefits to this way of working.

• Gone is the commute, time back in the diary.
• There is greater flexibility over your schedule, helpful with competing demand
• We now have the ability to quickly check in with customers/employees, wherever they are in the world.

In some ways this has actually been an enabler, helping to build stronger relationships and find new ones.

However, despite this apparent panacea, all is not perfect in paradise. Increasingly we are starting to hear about some of the drawbacks now too.

• Shorter meetings: Meetings have gone from typically an hour before to 30minutes booked. This was fine, there was a lot of chit chat anyway. However, now there is a new trend, 15minutes only, straight to the point. At some point, it is feeling as though the human niceties are getting squeezed out, just so we can squeeze more in the day.
• Back to back is the norm. No longer are we running between meeting rooms, let alone offices, which at least did provide a moderation of exercise. Now with mearly a click we are onto the next topic, with hardly time to get a coffee, let alone get ready and prepare.
• Fragmentation of the day. With various calls, all day, the days are becoming increasingly fragmented. It can be hard to get clear slots of time in the day to actually get work done. Quite a few folks have mentioned longer hours and working late more often now. This is the only time when the diary is free and without distraction.
• Asynchronous work patterns. Digital has been great, with asynchronous messaging allowing us to get stuff done on the side, multitasking. However, this is also transferring across to the workplace too. A conversation at someone’s desk used to take 20minutes, job done, complete. Now it may take a day, broken into chunks of conversation, all to get the same information. Whilst this approach has been great for customers interacting with companies. For companies interacting with clients, and wanting to get product out, at best it is leading to inefficiency, at worst process delays.

Peak Digital?

Some with a rush to online, remote working, are we now seeing a pause for thought. Maybe we are not longing for the past, but starting to value more a few features of the office that are now gone.

So are we reaching a peak in digital? Will there even be a peak? Will we go back to the way things were?

Likely there is more to run. There have afterall been some real benefits from digital working. Most employees don’t want to go fully back to the office just yet either. There are however certainly some early signs of a change in mood.

Likely we will reach a new, different, equilibrium in the coming months, trying to recapture some of the human interaction we have lost… it will be interesting to see how it all evolves.

Other stories this week

• Interesting comments from the FCA this week on regulation for the Buy Now Pay Later sector, resulting in a flurry of headlines and action. This was a result of the Woolard review into the unsecured credit market, which also makes an interesting read too. Maybe more on this another time.
• Elsewhere there was further concern voiced on the end of stamp duty relief and the impact on the housing market. Still now firm change on this yet, although there is plenty of pressure for an extension. It currently end on 31st March 2021.
• Lastly, new data showing the softening of credit card and motor finance markets too.

Changes are afoot, and similar to working patterns, we are starting to see impacts crystallize and normalize to a new equilibrium it feels

That is all this week, have a good weekend everyone.

With all the talk of vaccines, delivery and contracts this week much of the news from the financial services industry again seemed lost in the mix. It was still there, but for the moment COVID the vaccine scandal has dominated the news. There were however still some takeaways from this.

Undoubtedly what became increasingly clear was the value and need for good legal advice. When push comes to shove, and there has been a lot of shoving this week, everyone has been looking at the detailed contract wording and what all this means. This is especially the case in the creation and review of such large contracts.

This unfortunate episode also highlighted a couple of other aspects too.

1. Impact of resource scarcity: Shortage of a desired resource, whatever the reason for it, can bring out the worst behaviours in all of us. Backed into a corner, under pressure, we fight, and it can get ugly quickly. It is hard to resist the urge to point fingers, apportion blame and then have grown-up conversations in order to find solutions. Throwing rocks is just easier. We saw a lot of this week and more generally have seen a lot of this in politics. It an increasing trend and one that is concerning, nothing good comes this way. Lesson: Try to take the high road, be the bigger person and concentrate on finding solutions.
2. News reporting is all relative: I obviously mainly read English language news, but do also have access to other media. On this topics the stories from the UK, Italian, and German newspapers have all had slightly different interpretations of events, which has been useful in forming any sort of opinion. Lesson: Take a balanced view of opinions and read widely.

Of course the rest of the world has still turned, and back in the world of consumer finance, there were also a few notable stories this week

• Credit Card balances continued to fall as repayments outstrip borrowing, however on the other hand 9m people have increased their borrowing in 2020 due to COVID. All of this points to divergence and segmentation within the consumer base. People who have jobs and not really impacted by the virus yet are doing fine, saving money. However, those who have been impacted are struggling, significantly. We need to think hard about ensuring we have support mechanisms for the later group.
• Persistent debt changes were visible this week, with one of the largest credit card in the UK increasing minimum monthly payments, so consumers pay off their debt faster. This has been in progress for a while, of course, but with timing, difficult, after Christmas and in the middle of a pandemic.
• Consumer action, the short squeeze. The US stock market does seem to have lost sight of the ground in recent months, however, the action with RobinHood investors and GameStop has been fascinating. Coordinated mass market buying to influence the price (then getting restricted from trading), all sounds very similar to the behaviour of some hedge funds. Before we all get too righteous mind you, the gordian knot that is investment finance could see these linked with our investments, and via defined contributions our pensions. How this could unravel is yet to be seen.
• Lastly, Buy now Pay Later: There are concerns about this form of lending, and whether this could be the instance of over borrowing. Even some in the industry are calling for more regulation. This was rejected by MPs the other week. Although gone for now, taking a proactive stance on approaches to credit risk and collections now is worthwhile, it will likely return.

That was the week, have a good weekend everyone…