Operations 4.0 Underway
Deutsche Bank says Operations 4.0 is already underway.
The plan is to Replace 18,000 Jobs With Robots.
Mark Matthews, head of operations for Deutsche’s corporate and investment bank, told Financial News that machine learning algorithms “massively increased productivity” and “redistribute capacity.”
The London-based news organization said that Deutsche is pushing to “automate large parts of its back-office” via a new strategy called “Operations 4.0,” as part of its $6.6 billion savings initiative over the next three years.
Matthews told FN that the machine learning tools helped to save “680,000 hours of manual work” and that it “so far used bots to process 5 million transactions in its corporate bank and perform 3.4 million checks within its investment bank.”
In what insiders called a surprising move, the bank this summer said it will keep the bulk of its equity research department despite eliminating the bulk of its stocks sales and trading division.
Why stop at 18,000? Please consider my 8 step proposal to get rid of everybody.
Just Fire Everybody
- Who needs proprietary equity traders? Fire them all. Machines do all the trading anyway.
- Who needs stock analysts? Let computers determine the “Strong Buys”.
- Who needs credit analysts? Computers already do the scoring.
- Derivatives? What a mess. Unwind them all and stay away. Fire everyone involved.
- Real Estate Appraisals? That’s what Zillow’s for.
- Credit cards processing? Outsource 100% of it.
- Statement processing? Outsource that too.
- Loans? Let computers decide which loans to make. Then keep none of them. Instead, securitize 100% of them.
Mike “Mish” Shedlock
Get rid of all the bloggers and replace them with bots!
But seriously from experience 90% of AI is just hype.
The worrying thing is that people once scoffed at Chess computers ever being able to beat a human. Now we scoff at them outtthinking humans generally. Will we be scoffing much longer? What role is there for us if they become cleverer than us?
You should study AI: read actual research papers and stop reading news articles about it. The more you will know about AI the less concerned you will be.
BTW getting computers to beat humans in closed and fully observable games like chess or go is child’s play compared to having them learn common sense (e.g. intuitive physics).
18000 is only the beginning. A couple of companies I work with are in the process of scaling computing to unheard of performance and scale. One of them which use to simulate global warfare exercises on the scale of years will now be able to accelerate their sims for DoD to it in hours and not years. Machine learning is going to think on a level not possible by humans. Automation is coming in a big way to businesses of all kinds not just manufacturing. This is really stuff of scifi shows and movies ahead the next 30 years. Life wont look similar or recognizable because technology innovation is outpacing everything.
Homeless with suit and red tie..need high class shelters.
That means no customer service. The beginning of the end. Can’t help brain dead.
Pff… It’s clear that robots do better. Why not leave a bunch of people out of work? Indeed. The freelance market is booming, and link to periodix.net or resource like this will help you quickly find a job to your liking. It’s logical. Perhaps the head of the bank will also replace himself with a robot? Well, it will so increase productivity!
Crazy
All those AI efforts sound great, BUT how bad are Deutsche Bank’s finances that AI could not prevent or reverse their share price from falling? Having grown up in IBM country, I continue to follow IBM news. Their AI platform, WATSON, performed wonderfully on Jeopardy; however, as a business advisor, it has not really improved IBM’s sales and profits over the past ~6 years. AI is still in its infancy stage to be placed on autopilot. AI algorithms are only as good as the humans who programmed them. Garbage In = Garbage Out.
Watson works very well in a “kind” learning environment. The output is predictable, the activity is limited and very little is left to random chance. Unfortunately the universe is “wicked,” in that the rules are unclear and incomplete, and feedback may be random, delayed and inaccurate. I’m re-reading the book “Range: Why Generalists Triumph in a Specialized World,” mostly for motivation, but it also explains why there’s so little progress in machine learning (but it is getting better at oddly specific tasks).
Hey everybody, I think we’re being too rough on@[Country Bob] . Let’s face it, everyone who posts here is a bit of a blowhard. It’s one of the appeals of the place. Bunch of old dogs sitting around mumbling, “Well sir, back in my day…”.
His assertion about where the comments come from may have been just a wee bit clueless, but, hey, we all make mistakes, mistakes, misteaks, meestakes.
That said, I know, know, know – yeah, I’m real, real positive – that@[Country Bob] is actually a bot from Bangalore! Doubt me? Here’s the proof: @[Country Bob] if you’re not a bot, reply to this message.
Ah ha! See.
Was watching PBS Frontline ‘In the Age of AI’. One interviewee opened my eyes when he stated that AI was more a danger to white collar jobs than blue collar jobs, as computer are more apt to do analysis far better. Guess that is quite true.
Not sure whether it’s a white/blue collar thing, but go out and price a “robot” that has movement and dexterity in the realm of what any warm body has.
The price of “brains” is, indeed, coming down fast (as it has been for decades). But the price of bones and muscles? Serious dough. And, after you pay, you get a thing that runs 24×7, which is nice, but it also takes a lot of fuel compared to the real thing.
That’s probably what was behind what the interviewee said.
Well, both. The line between blue and white collar is becoming blurry. Robots aren’t installed by some ordinary assembly guys.
That video should be titled “I love work, I can watch it for hours.”
Fascinating stuff. The thing to remember is that this factory is the final assembly line. I’ll bet that all those prebuilt modules (such as the dash and drivetrain) have tons more hands on buildup than what we see here. It also clearly shows why modern cars are such a pain to work on. The different modules are brought together in the most efficient way to install on the line, not in a way that makes parts accessible.
Surely Mish, using a VPN would mean that the true location of where a post has originated from is unknown. I use a VPN (Cyber Ghost) regularly to access US web sites from the UK that would otherwise not let me.
On an individual basis a few people use such traffic. For what purpose here? Specifically from India. To the tune of “at least 30%”?
Country Bob is full of shit to make such an assessment when he cannot possibly know what he claims to.
And by the way, if Google thinks bot traffic is significant, they ban ads and lower your rankings.
Are there developers of Moneymaven in India?
He may be seeing raw traffic numbers resulting from their activities.
CB you have 15 minutes to apologize for being an idiot
I’ve never called for anybody’s head on a blog before, but I hope you bring the hammer down on CB. He’s an incendiary blowhard.
“At least 30% of Mish’s blog traffic in an average week comes from click farms operated out of India.”
CountryBob,
That blatant lie damn near got you banned. I will not put up with such bullshit.
One more asinine comment like that and you are gone. People will probably cheer.
IF YOU EVER say something like that again – get the F off my site. And I demand an apology NOW!
Do it Mish! First cheer from me.
Anyone else noticing the irony of this post?
At least 30% of Mish’s blog traffic in an average week comes from click farms operated out of India. “Comments” get automatically posted out of Mumbai by automated chat-bots following a script.
The bots post “conversations” paid for by political action groups. They have scripts written for Facebook, pre-written comments for WaPo and NYTimes, and slightly different ones for Mishtalk
A lot of the time humans on this blog are in fact arguing with chat-bots in Mumbai. Some are actually arguing, while others (cough) were hired last summer to flush out the bots, track their origins, etc. Its been a wild ride, but our contract only goes to the end of this month
Yes, some of the click farms in Mumbai have IP addresses registered in Mumbai while others are registered as Pakistani. A smaller number are owned by PLC’s in tax free Ireland., but those are probably operated out of India.
Just thinkin’ aloud, not like they were actually tracked
Seriously? Do I look like a bot to you?
Could you please point me to some of those automated posts by bots to educate me?
While India is more infamous for its call centers, etc, you perhaps substantially underestimate the number of Indians (in India) with a wide world view and a very wide reading habit. Classic 19th Century Western outlook towards the East, particularly India.
LMAO what are you smoking CB?
But the list of things you suggest should be automated were in fact automated at most big banks more than a decade ago.
Push “1” if you need to have that repeated. Push “2” if you want an automated voice system to tell you your current statement balance. Push “3” to hear your credit card balance. Push “4” to have this voice synthesizer say the same things in Spanish
That is not even remotely what Mish has written about. What you are saying happened more than 15 years ago and is not AI. Old fella, catch up.
The only difference between automation which “is AI” and automation which is not; is that over the past 15 years, Google has replaced Gordon Gecko as the cultural icon that vain and clueless Fed welfare queens think it is cool to pretend oneself is like.
6 & 7 are already done by computers. You could pull this off with just a few simple regulatory changes. This is all just finance stuff. The world would be better off if these folks got real jobs and produced something.
#9 CEOs
Do banks REALLY need to keep them around? At 10s of $millions / yr?
Especially, when a typical Board Meeting goes something like this –
CEO: Can I have a raise of hands of all in favor of stock buyback / dividend proposal? Good. Lets break for lunch. Everyone remember Tee Time set for 1:00.
…..Oh…and don’t forget your checks!
Of course CEO’s are needed! Who will coordinate the bribing of politicians come bail out time (every decade or so)?
I am looking at how those things are implemented in other big bank. Just wait until it fails (and one day it will big time). This is going to be fun.
I agree, and we will be the last to know….the message will read “Your account has gone away”
Real estate appraisals and stock analysts – the robots could not possibly do a worse job than the humans.
The beauty of random sequences, is that anyone, and anything, do an exactly equally good job at predicting them.
and not only that, 61.9% of statistics are just made up. 90% of scientists agree with that.