3. Data Democratization Podcast: The digital transformation talk with Rebecca Macieira-Kaufmann, ex-Citi, ex-Wells Fargo executive, Revolut board member

Rebecca has decades of experience in leading banks. She led major transformations and has a unique, executive level perspective to share with those of us interested in all things financial data and digital transformation. She is currently advising CEOs and works as a board member at exciting organizations. To find out more about Rebecca, visit her site.

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Alexandra Ebert: Welcome to the third episode of the Data Democratization podcast. I’m Alexandra Ebert, MOSTLY AI’s Chief Trust Officer, and I have my co-host Jeffrey Dobin with me who is a lawyer and a privacy expert. Let’s jump right into this episode. Jeff, can you introduce our guest, please.

Jeffrey Dobin: Of course, Alexandra. We had the honor to speak to someone who is probably one of the world’s most experienced leaders in finance, Rebecca Macieira-Kaufmann. She previously served as executive vice president at Wells Fargo and was with the bank for 13 years. She led teams through major transformations at Citibank for another 12. Now, she helps others by advising startup CEOs and sitting on boards of numerous exciting organizations like Revolut. I think you’re really going to like this episode with Rebecca.

Alexandra: Hi Rebecca, it’s such a pleasure to have you here with us today. Can you share a little bit with our listeners about your background and how you ended up as such an impressive leader in the financial services industry?

Rebecca Macieira-Kaufmann: Thank you. I appreciate it, Alexandra, it’s a pleasure to be here. I have had the honor and joy of having an amazing already 30-year career in strategy consulting and financial services. How I ended up in financial services is actually quite funny and I had always wanted to be in really producing products and I wanted to work abroad. I always wanted to be working internationally and I looked for a role in England. The only people that would hire me were strategy consulting firms.

I ended up in strategy consulting, worked in it for three years. The place that I was working had a lot of clients in financial services. I ended up getting to know financial services companies that way and when I came back to the United States, I got a job in my first role outside of strategy consulting, it was in product management. I really was interested in being a general manager and I found that product managers run all aspects of getting a product to market, from operations in marketing and communications. That started my career at Providian Financial which happened to be more in credit cards.

From there, I moved to Wells Fargo and went into the insurance group there, and from that, started a small business lending group, and from that, into small business cash management and all of small business. From there, it lasted about 13 years there, worked 13 years there, moved to Citi, and there I came in as the president of Citibank for California and Nevada which is the retail consumer side. Did that for about four and a half years and then moved into being the president and CEO of Banamex USA, and from there into becoming the head of the International Personal Bank, which is really international wealth management. About 12 years at Citi, a very exciting career, and now in June, I took early retirement from Citi and started my own business. RMK Group LLC where I’m a board adviser as you know, I’m sitting on some advisory boards and advising some CEOs, primarily startup CEOs as well as writing a book and writing some articles. It’s a very fun phase at RMK Group LLC.

Alexandra: It sounds like that, and it’s really an impressive track record of leading these large organizations through digital change, and also, now advising startups on how to grow and scale their company. I would be really interested, can you share your most memorable story of data on digital transformation?

Rebecca: I’ve had the honor of being in some very interesting digital transformations. The one that is most memorable right now is that we had a client onboarding process that was very lengthy and we were getting both employee and consumer frustration with the process. It just took much too long. I asked a group to re-engineer the process and send them off to sit in a room and whiteboard it. Then came back and worked with them, we all sat in a room and whiteboarded it. Then got about, I think, almost 40 people in a room from legal and compliance operations and more to really collaborate and say how do we re-engineer a client onboarding process end to end?

We created what I would call a sandbox and from that we took- we agreed to experiment and take out just, let’s say, 30 or 40 applications and follow them end-to-end and then understand what were all these handoffs we were doing and why and how each handoff you ended up with either duplicate data that then had some conflict that we had to call back the customer and reconcile, which is always a nightmare for the employee and for the customer. One of the things and I’d say one of the biggest things we took away is having to get rid of the conveyor belt approach. The application moves through a process like A, B, C, D, E, F, G, and starts to collapse the whole process. Maybe we could do A to D at once and then we could do E to P, I’m making this up, at once and get this into this parallel processing and use all the data from the very first interview with the client to populate everything else.

Just a lot of re-engineering and using data much more effectively, using it once and using that first time we got the piece of data, like my name R-E-B-E-C-C-A and not writing it again somewhere else with one C and then missing an E and then having all this data reconciliation to fix. That was much harder to do than we thought, but we did do it. We improved the application onboarding time, an 80% improvement. Really radical. We took the time to do it. It took a lot of planning, months of planning, and dissecting the process, really revisiting our entire mindset and policies around it, in fact.

Alexandra: It sounds impressive. You mentioned that it was a very long process and that plenty of people were involved. Would you say that this is a critical factor, that 40 people and people from different departments involved if you want to design something from end-to-end and improve it in such a significant manner?

Rebecca: Sure. Well, it’s funny now, I advise some companies that have fewer than 40 people. At a large organization that’s integrated into an even larger organization, often the technology one uses- at least the technology we use was used by others, so if we were going to make a change, it would impact other businesses. There’s such a shared infrastructure in a large corporation that it involves a lot of people, and which is why we had to do this, what I call sandboxing, and really do a takeout to do the whole thing in parallel, prove that we can make it work and then plug back in our changes without impacting other parts of the institution because policies that we were going to rewrite might affect and then become in conflict with an onboarding policy for another part of the institution.

Alexandra: Yes, of course. When we had a conversation before the episode, you actually mentioned that policies have a very detrimental impact on the ability of an organization to innovate. Can you share why?

Rebecca: Sure. Some of the times, we would find that we might be re-engineering a process only to find out after we re-engineered the whole process to say we no longer require a wet signature or no longer require face-to-face interaction, when when we go back to the original policy, somehow, it was actually in the original policy and said wet signature or face-to-face confirmation. To change that face-to-face in-person requirement to video or to change that wet signature to a digital signature required actually rewriting the policy. Again, that might impact other units of an institution, so you would fail or one would fail an audit if your implementation didn’t match the policy. We had to always go back and look at the policies. I think sometimes that surprised us that where the original- how much of what we thought X years ago gets modified into a policy.

Alexandra: Yes, I can imagine that. You mentioned having to change policies and being okay with digital signatures and not only wet signatures. I assume that with COVID and the current pandemic, many organizations had to change their approaches in a quite radical and fast way. What’s your perspective? Will this be positive for future developments in the digital space and help organizations to innovate faster?

Rebecca: I think it’s going to be very positive. I would say if there is an upside to COVID, in all the interviews I’ve read, all the CEOs I’ve personally interacted with, this has been the fastest way that they have had to make the digital change in COVID. Things that they might have thought would take a year to 2 years got done in 60 days, learning how to have people work from home, work remote, have secure environments, interact with customers in a way that is fulfilling for the customer and safe. Yes, I think that this will be the upside of COVID is the rapid digital adaptation.

Alexandra: Let’s hope for that, that we at least get some positive things out of this pandemic. Rebecca, when we speak about digital transformation, one thing that’s oftentimes holding financial services organizations back are actually the legacy systems. You mentioned that you have something to share about that from one of the companies you advise.

Rebecca: Absolutely, yes. I’m on the advisory board of Duco headquartered in the UK, and really what Duco has seen in their coming about is making data easy because they’re helping financial institutions with their legacy systems and legacy processes. What really they’ve seen is that AI has a big role to play in moving out of these billions of dollars of costs and legacy systems into a much more agile system.

For instance, they have a product called Duco alpha. They have saved their early adopters almost 2,000 hours in data manipulation, which is just huge savings for the workforce. They did that quickly just a few months. That was just for a very small part of their client base, process mining, automated repair of data, outlier detection of problems. All of these through their data work are able to get it to see a big impact.

A lot of the narrative in the AI and ML space is about gaining new insights from data or offering new products. Of course, as I mentioned before, it’s only as good as data in, data out, or garbage in, garbage out. I think where Duco really can help is that they help make sure that the data is clean when it goes in itself so that then you can have the right kinds of insights that come out and are very effective for the industry. It’s early days, but it’s very exciting.

Alexandra: Yes, absolutely. It sounds like that. You also shared another story that I find particularly exciting. You’re the board member of a company that specializes in digital health. Actually, it’s a venture that invests in companies specializing in digital health. You shared that they actually use machine learning and artificial intelligence not only to become more effective but also to make fair decisions. Can you share a little bit about this story with us?

Rebecca: Yes, I’m on the advisory board for a company called DigitalDX Ventures. It’s a venture firm looking to invest in digital health companies that are really going to radically change the future. One of the things when I was speaking with the general partner about how do they use AI, clearly, the companies they’re investing in are radically shifting the healthcare space by leveraging machine learning and AI to make enhancements in healthcare. How do they actually use it internally at the venture firm, and the general partner, she mentioned that they get 80 to 100 prospect clients, companies that want an investment every month, and that they’ve over time determined there’s about 72 important variables that make a difference.

They’ve been able to use machine learning and AI to take those 72 variables, put the companies through that to then determine which of the- let’s say in a year they’re getting a thousand companies, which ones would they dive deeper into and do their due diligence on, and one of the very select few that they’ll invest in, but one of the things that was so interesting is they learned that it even takes buyers out of the process.

What she meant by that is that if someone is a phenomenal salesperson, but the actual 72 variables don’t merit it, you might be more influenced by that person’s sales ability, or if someone had a very strong accent and you couldn’t understand everything the first time through, you might not have hooked onto the important variable at the same way. When you put it into the model, the accent goes away and therefore you can be fair to assess the true facts underneath the data.

Alexandra: That’s actually a very impressive and positive example where artificial intelligence can really help us to not only make better decisions but also fair decisions and really take everybody into account. I would like to go back from digital health to actually the financial sector. In your opinion, how could financial organizations change to get more out of the data that they already possess and to get more value out of it?

Rebecca: One of the things that I saw in all my years is that data is everything. We live in a world of data. We need data. If one could take the time upfront to plan better, to step back, and really plan about, how are we going to use the data? Then to take the time to decide if we need both customer-level data, household-level data, product-level data, financial level data, how do we build our data architecture so that we can access all of those pieces, combine and link them appropriately for all the different kinds of reporting we have to do or, or analysis we need to make better decisions while simultaneously keeping immutable forms of it, or a golden copy, that then would allow for really good reporting for all the government entities or regulatory entities that need it, and in addition to- I’ve decided from everything I’m reading lately about ransomware, if you had that immutable golden copy offsite or not connected to the backups, you would then have the ability to handle ransomware hijacking much better. Lots of things that I think one can do to use data better and better prepare for it. I think one of the main issues is to spend the time upfront to make everything else better.

Alexandra: Yes, this is definitely a wise step to take. Once organizations have their data in place and actually have it sorted in a way that allows you to get value out of it, what else is important for organizations especially looking at the employees working with this data?

Rebecca: What I really like about working with all these different CEOs individually and hearing the issues for startups as well is that data agility is really critical, particularly in financial services, both modular and granular data resiliency and the connectability and linkability and backup capability, I’d say, on data resiliency. Then data security, protecting all the access points, we’ve seen become even more important in the work-from-home environment. Then scalability as many of my clients are global and are going into new countries. Then you have- how do you scale to new countries? How do you keep your core, but also have the elements you can modularly change for each country’s unique regulatory environment?

Alexandra: Of course, this is definitely challenging with all the emerging regulations we have, for example, in the privacy space. You mentioned that you’ve worked a lot with CEOs. What’s your top data advice you give to CEOs?

Rebecca: I think we covered it. I think it’s a plan. When you plan, make sure you’re planning for that data agility, the data resiliency, the data security, and the scalability, but everything takes- I think what I still see is running deep into an expertise area versus stepping back and saying, “Where are we going at scale?” Then planning for that much for further out me than what you can see in the year.

Alexandra: Understood. Since we are approaching a time where digital development is so fast-paced and artificial intelligence is increasingly important. in your opinion, how much data knowledge should chief executive officers of large organizations have or are they perfectly well-equipped if somebody in the senior level management team has this data knowledge to lead digital transformation?

Rebecca: I think the CEO needs a lot of broad knowledge. I don’t think the CEO specifically or the leader needs deep knowledge. They have to know how to hire people with deep knowledge and work in their domain expertise. I believe that companies forever have to be about the customer and the client experience, the employee, the employee experience, the shareholder and the stakeholder, and make sure that all of that is optimized. A CEO or a leader has to have a breadth of ability to solve problems and bring the right team together. You really need to bring in the right data experts for the unique business.

Alexandra: Understood. The challenges chief executive officers faced like 10 years back versus the challenges they face now, have they changed in your opinion?

Rebecca: I don’t think anyone foresaw a pandemic, that’s for sure. I often say that in my career, I’ve lived through 100-year events about every 10 years. What I’m realizing is that these 100-year events come much more frequently. I think this planning for resiliency, but not knowing what you need to really be resilient about. I have lived through financial crises, 2008, hurricanes that have wiped out whole islands, and given my head- in one of the businesses I worked in, we were in 100 countries. I’ve seen constant kinds of- either weather or governmental shifts that have changed the entire financial landscape for that market. In other words, we have to be ready for these big anomalies to happen all the time, but how do you it not knowing specifically what it is? That’s why I think what we’re talking about in terms of data resiliency is really important, and employee resiliency, the ability to work from home I don’t think was really thought through at this level, and what it would do to bandwidth and capabilities and people having access to the internet.

I think each one will always bring up some unique things. I know after the hurricanes in Puerto Rico, I learned a lot about getting a big solar power- it was $3, but you can actually use the sun to power a laptop for eight hours and we were a team that was using those, and learned about a lot of different things that I don’t think- I mean I live in Francisco where there’s earthquakes. We are all ready for earthquakes, or if you think about after 9/11 when we all had to pack a to-go bag of tennis shoes, a bandana for smoke, I think each disaster we learn something by going forward, but I don’t think we can predict what that next one would be. All I will say is that it won’t be 100 years away.

Alexandra: Would you say that data can help organizations to build this general resilience?

Rebecca: Absolutely. I mean, data is really everything. We use it all day long for everything from call trees to automated call trees for disaster recovery from backup sites, all of that’s based on data. Absolutely, I will come back to those scenes of data needing to be resilient and modular and protected and secure in a way that enables us to respond to these different crises as they arise.

Alexandra: Yes. Especially with data in mind, what are your predictions for the financial sector in 2021?

Rebecca: Well, it’s interesting. I’m sure, given we’ve already started 2021, for sure we’re going to have a more and increasing digital landscape, and that is just so broad. From digital notaries for mortgages to more and more digital signatures to digital IDs, more mobile banking, more contactless payments, I just think it’s going to be ever-increasing. Just the digital trend alone is gigantic and continuing to be so.

The second trend I’d say is this increasing need for security, privacy protection, permission-based privacy, that would be critical, all the security. The third area is increasing personalization. I think people expect much more tailored personalized approaches in financial services. Today I think people can start building out for investing, choosing their own stocks to go into a fund to make it ESG or in a certain country or to match their value system. I think the fourth trend I imagine is the increasing crypto. More bitcoin for sure, more decentralized finance. The fifth one I’d say is just the evolving and regulatory environment that we’ll have to keep up with in the landscape, to keep up with these changes.

Alexandra: Absolutely. You mentioned two points. One was privacy becoming more important, then also personalization. For many people, this is something that’s contradictory. How can an organization achieve both of them at the same time?

Rebecca: I think a lot of it will continue to be permission-based. Can I use this data on you to get you better recommendations and you will have to- or we will each have to opt in? I think many people do because they want access to all the different vehicles they can get online and to get that more tailored approach is actually convenient and easy. As long as it’s not abused, then people will opt in I think.

Alexandra: What are you personally looking most forward to in 2021 when it comes to these predictions for the financial sector?

Rebecca: I love it when it gets easier, but I think the thing we’re going to have to figure out is how to make it easier and secure simultaneously. That is always the challenge, but I love that we’re getting when, where, and how we want, omnichannel is getting every better. I think we are making it that you can choose what’s best for you, digital, online, starting something in one place and finishing it in another. I see us getting better and better at integrating a cross-channel- the client experience. I think that’s exciting.

Alexandra: Wonderful. Well, that brings me to our This or That game, that we like to play with our guests at the end of each episode. Just answer with whatever comes to your mind first. Are you ready?

Rebecca: Sure.

Alexandra: Perfect. Perfect. My first question would be stocks or crypto?

Rebecca: Crypto.

Alexandra: Why?

Rebecca: I think it is the future for so many cross-border potential ease of movement in countries and particularly where they don’t have the same trust with their government that we do here.

Alexandra: Yes, I can think so too. My second question would be mobile banking or branches?

Rebecca: Mobile will grow more.

Alexandra: Okay. Because of the convenience and things getting easier as human not being able to go out too much during this pandemic.

Rebecca: Yes.

Alexandra: Wonderful. Then one thing that I haven’t mentioned but find really impressive, you speak five languages and talked about working in different countries. What would you prefer; France or Finland?

Rebecca: Oh, I love them both for different reasons. France for food, art, and family. Finland for friends. I love both, can’t choose.

Alexandra: Okay, once traveling is allowed again, you will be on a plane?

Rebecca: Yes.

Alexandra: Wonderful, wonderful. Doing or thinking?

Rebecca: I’m a doer.

Alexandra: Perfect. Perfect. Then we also have a cultural question. Bach or Chopin?

Rebecca: Chopin.

Alexandra: Why?

Rebecca: I love playing Chopin on the piano.

Alexandra: Oh, wow, you can play piano. That’s impressive. My last question I have from our game is saying yes or say no to opportunities that come your way?

Rebecca: Oh, well, I clearly say yes. That’s how I ended up on this podcast. [laughs]

Alexandra: Wonderful. I think that was really motivating what you shared when we had our first conversation about that you are a yes-sayer and sometimes end up I think you mentioned with a quite full schedule, but it also brought you to some amazing opportunities. Can you give some example of what, besides our podcast, came into your life by saying yes?

Rebecca: Well, it’s funny, the DigitalDX advisory board opportunity came from- I went to a Zoom holiday party for WomenCorporateDirectors, and then we had these breakout sessions where we were talking about what we were doing in groups of five. One of the women talked about a book she was writing, and I said, “Oh, I’m in the middle of writing a book.” We got into writing about books and that’s how I met Michelle, who’s a general partner for DigitalDX. We ended up going for walks and then talking, and now I’m on her board.

I think things come out of places that- I have to say before that digital holiday party, nothing could sound worse to me than a digital holiday party. That’s just totally not my idea of a holiday party, having a drink on the screen, and yet, I realized they’re so important to try and connect with different people in different groups. I really appreciate WomenCorporateDirectors and the content and the connections. I go, but I think that’s what I mean by you have to force yourself to say yes, versus times you just want to not be on a screen.

Alexandra: Absolutely. Especially during these times, it definitely helps to engage in some Zoom conversations. You mentioned writing a book, what will your book be about?

Rebecca: My book, very exciting. It’s called Fit CEO. It’s about being the leader of your life, and I share stories throughout my career, I’ve traveled 200,000 to 300,000 miles a year. How to travel and stay fit, how to stay calm under pressure, it’s integrated leadership and fitness from mental, spiritual, and physical. My co-author is trained- educated in personal fitness and training, and has her own integrated coaching business. It’s a fun book with two voices.

Alexandra: Well, it sounds like the perfect time during this pandemic where everybody experiences the impact of being at home all the time, that this can really help you to take some steps in your life that helps you to be more happy, and also a better leader in general.

Rebecca: It will come out in September.

Alexandra: Yes, absolutely. We’ll definitely recommend this to our readers to not miss out on, I think Fit CEO, you mentioned was the title.

Rebecca: Yes. Fit CEO. Thank you.

Alexandra: Perfect. Sounds exciting. Well Rebecca, thank you so much for taking time today. It was really a pleasure to talk to you and I’m really looking forward to seeing your book published and getting some tips from there.

Rebecca: Great. Thank you, Alexandra. It was really great to speak with you today.

Alexandra: Thank you very much. Wow. What a great episode. Let’s kick it back to Jeff for our most valuable takeaways.

Jeffrey: Awesome. We’ve got five for you today. Number one, to re-engineer processes, you need to really dissect them and change your entire mindset. Rebecca and her team cut their client onboarding time by 80% by getting rid of the conveyor belt process and by using data more effectively from the very first step all the way to the end. Number two, when you want to digitally transform your organization, you should take a close look at your policies. Oftentimes, they were codified without digital tools in mind, and to unleash innovation it’s sometimes required to rewrite them.

Number three, we learn that AI can be a great tool to aid in effective decision-making while making those decisions more fair and less biased. Number four, it is critically important for financial institutions that really want to get value out of their data to ensure that data agility, security, resiliency, connectibility, and international scalability are addressed. Number five, we learned her secret and her secret is good planning.

Alexandra: Thank you, Jeff, and thank you to all of you who listened today. I hope you enjoyed our conversation with Rebecca, and just as a reminder, her book Fit CEO would be published in September, so make sure you grab a copy. If you have any suggestions or questions for a podcast, please reach out to us through podcast@mostly.ai. See you next time.

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