Money 20/20 conference – EUROPE’S BIGGEST FINTECH SHOW with Sebastian Schäfer

Sebastian Schäfer – Managing Director TechQuartier Frankfurt – FINDER partner, mentor of amongst others Jonas, as well as co-author on Jonas’s whitepaper, features amongst the 2021 Money 20/20 conference in Amsterdam: “Fintech, let’s get back to business”.

The FINDER team is very proud to have Sebastian amongst our crew.

Want to find out more about the conference? Click here.

Start-Up Weekend on digital entrepreneurship for entrepreneurs and academics

This Fall, the FINDER Project team, in collaboration with Radboud Centre for Organization Restructuring and Atos will host a Start-Up Weekend on digital entrepreneurship, which will be of interest to both entrepreneurs and academics.

This Start-Up Weekend is a public event to help individuals with creative ideas for digital entrepreneurship start their innovation journey. This event intends to surround entrepreneurs with smart and passionate people, with the best tools and approaches that will help move towards creating their own business and connecting with the right people and resources. A wonderful opportunity for idea-stage start-ups with an eye towards a partnered, invested, or acquired future to workshop their ideas opposite a panel of industry experts and a group of the general public. Equally a great opening to provide for an academic perspective on the theme of collaboration for responsible innovation.

We foresee inspiring sessions and lively discussions with panelists/speakers from amongst others Philips, ING, TechQuartier Frankfurt and Atos.

Scheduled for the Fall, this Start-Up Weekend is especially geared towards those with a keen interest in entrepreneurship in the (fin)tech domain, and is organized with the intent to lower the hurdle to early career entrepreneurial activity. As part of a series of events to further tie in academia and business practice, the Start-Up Weekend will be another exciting opportunity to exchange ideas between practice and academia. Cementing for future collaborations in the domain of responsible innovation. In this series the FINDER Project Team and the Radboud Centre for Organization Restructuring prior hosted the Inclusive Digital Innovation Week in FS&I together with our project partner Atos.

Designed as an event that builds an innovative collaborative arrangement among established tech firms and start up enthusiasts, we highly encourage startups, university faculty members and students to sign on if interested.

We are currently looking into the possibility of hosting the Start-Up Weekend on site. However, pending further developments of the coronavirus pandemic, the workshop might be virtually hosted. 

Details for the sign on procedure and further event specifics will be shared shortly.

Additional information for students:

The panel of 5 general public members will have a unique opportunity to peer into the process of business creation, and this may be of scholarly interest for Master’s level students. Especially students who have it in mind to focus on entrepreneurial themes or business innovation as a topic in their thesis, this could be a valuable networking opportunity and a research flashpoint.

Interested applicants will need to stay keyed in to the group dialogues for the duration of the workshop and pitch in when they have ideas or when things don’t make sense to them, as their primary function is to keep the workshop grounded and from getting disconnected from consumer reality. Akin to product testing research, no specific expertise is required, and it’s not in the interest of the workshop for the general public members to emulate being professionals at something: just be your regular self.

WHEN ACADEMIA AND PRACTICE COME TOGETHER

Recently Jonas Röttger was invited by the Atos Scientific Community to present his research on CEO personality trades and how they influence strategic choices of firms. His presentation entitled “Loud moves, bold CEOs: The signal interaction effect of CEO overconfidence and deal-specific confidence in M&A announcements“ received one of the highest appreciating ratings during the Atos Scientific Community meeting.

During his presentation Jonas addressed the CEO personality which influences the strategic choices of firms. He investigated whether investors can see through firm actions as a manifestation of CEO personality by analyzing the firm’s M&A communication. In the case of overconfident CEOs, firms can receive more positive M&A announcement stock returns by releasing press statements with a less positive linguistic tone.

The FINDER output was very well received at upper echelon level, the Atos scientific community (approx. 140 people) and included a general discussion revolving around the topic of CEO personality and firm-level outcomes.

A great example of academia-to-practice transitioning – a gap stone point to this ITN program.

Egos Colloquium 2021 sub-theme 19 “Collaboration and the (Ir)Rationalities of Decision-making in a Digital Landscape”

Plenty of (ir)rational decision making commonalities on offer during an inter-disciplinary EGOS subtheme on Collaboration and Decision-making in a Digital Landscape, that kicked off today #EGOS2021

Thanks to presenters and discussants from across the continent (and England of course) we had a lively discussion.

Thank you Yuliia Yehorova, Erik Hanel, Zahra Kashanizadeh, David Langley, Werner Hoffmann, Alexander Engelmann, Renate Kratochvil, Sotirios Paroutis, Daniel Stedjan Svendsrud, Jin Xu, Linda Buis, Marjukka Klippi, Saeed Khanagha, Uli Meyer, James Ellis, Johan Buchholz,  Jonas Röttger, Maryia Zaitsava, Matthew Knight, Szyman Wiercinski, Henk Volberda, Dimitar Krastev and others.

Looking forwards to day 2: this round starting with a session on digital collaboration and its perils and troubles ….


Dr. Rick Aalbers

COVID-19 recovery in Cities and Regions: lessons from the 4th OECD Roundtable on Cities and Regions for the SDGs

After partaking in the prior OECD Roundtables on Cities and Regions it was a pleasure to be part of the community that comprised the 4th OECD Roundtable on Cities and Regions for the SDGs on the theme of a Framework for COVID-19 recovery in Cities and Regions.

Recovery is high on the agenda after the disrupting forces unleased by the recent COVID pandemic. A challenge that transcends form the individual to the firm level, to the city and regional level and back, introducing a relational complexity that is unprecedented. Hence it is great to see the many initiatives that allow firms, cities and regions veer back from the COVID driven turmoil they went through over the past year. A key takeaway from this roundtable has been the role of digital technologies to facilitate the swift recuperation. Technology allows for the communications and lessons learned and shared during this very OECSD hosted roundtable, but there is more to it.

With digital ecosystems operating beyond organizational and industry boundaries, as facilitator for organizational (firms, cities and regions alike) resilience,  such reorientation comes with advanced interdependencies. The management literature provides for some interesting lessons on this front. Reviewing some of the work that has passed by over the last decade, lessons can be learned. Organizations that find themselves in dire circumstances can improve their situation despite these ecosystem interdependencies, however, for instance by proactively implementing strategic change to stem survival-threatening performance decline. While firms’ propensity to reshape under external and internal pressure has received increasing scholarly attention (e.g. Bowman and Singh, 1993; McKinley and Scherer, 2000; Girod and Whittington, 2015), digital ecosystem dynamics have remained relatively understudied as a mechanism facilitating such organizational transitioning (Pagani, 2013).

Our current understanding of how orgnaizations reshape themselves as part of their digital ecosystems is limited however by the lack of a strong theoretical base to understand the implications of digital technology on extant theories and knowledge of organization restructuring as part of a digitally enabled environment (Adner, 2006; Kane et al., 2015). As firms no longer operate in isolation but operate in digital ecosystems that determine the way and magnitude to which a firm can transform a firm’s core architecture and the way it serves its customers (Tangpong et al. 2021). Though there has been more attention to the dynamic nature of business ecosystems in general terms, several scholars have argued that more work is needed to understand reciprocal relationships, timing and causal effects of these events, calling for further attention for dispositional, behavioral and contextual influences (e.g. Quintane et al., 2014).  Equally, extant research on turnaround management typically focuses on traditional outcomes (e.g., profits), and antecedents, (e.g. time and pace of change) with less emphasis on the technological advancements that may foster or hamper the extent to which organizations manage to individually or collectively reshape. On both fronts surprisingly little is known however about the organizational, temporal, and ambidexterity dimensions in digital ecosystems as they endure exogenous tremor. This challenge has recently infused several members of our Centre to shine new light on the challenges and opportunities posed by digital driven business ecosystem collaboration as firms collaboratively are forced to reinvent themselves. Thank you to the organizers of the 4th OECD Roundtable on Cities and Regions for the SDGs On that note for bringing further inspiration to this initiative.

Dr. Rick (H.L.) Aalbers

Collaboration FINDER and TechQuartier for the project ’Financial Big Data Cluster’

The success of the safeFBDC depends on our understanding of the underlying mechanisms (and technologies) which determine its modes of operation. While the liability study already has shed light on the IT infrastructure the underlying mechanisms of interaction between participants have not been fully outlined yet. Identifying and understanding these would help to leverage and manage relevant partners. Since such a project lives on from its members, the collaboration between TechQuartier and FINDER contributes directly to the long-term success of the safeFBDC.

“If we are to make strategic sense of innovation communities, ecosystems, networks, and their implications for competitive advantage, we propose that a new approach to strategy [called] ’open strategy’ is needed.”Chesbrough and Appleyard, 2007: 58[1]

An important underlying idea of innovation is its reliance on competition and thus the intertwined nature of both innovative and competitive behaviour.[2][3][4][5] While this idea has prevailed for a long time the predominance of competition has been slowly losing ground to the idea of cooperation.[6] In that light the concept of business ecosystems gains in prominence in both research as well as its application in business. Before diving into the underlying mechanisms of ecosystems we first should line out what we can understand under such a concept.

Back in school ecology taught us that ecosystems are systems of living and non-living interacting components within the same environment. So how can we apply that concept to business? An innovative reader (as innovation is also the application of an established idea to a new context[7]) may think about something in the line of the following:

“Business ecosystems are a network of firms with differing interests bound together as a collective whole such that the fate of its members is bound to the structure of that network and the roles played by its members.”Tan, Tan & Oh, 2007: 2[8]

In case of the safeFBDC the set of goals, its mission defined by its value proposition, binds together the consortium. The distinction is an open approach of formulating the mission – in other words their strategizing. That openness allows cooperation, a joint engagement in a strategy process of different organizations instead of their competition.[9] Following the literature, we can therefore define the safeFBDC as an ecosystem-as-structure.[10] For such structural approaches of ecosystems a keynode member with central positioning is of importance.[11] Such keynode members, already generally addressed in a blogpost by my colleague James, have three major tasks.

  1. They consolidate disperse resources & capabilities, as e.g. knowledge, of members.
  2. They engineer processes to initiate and grow the ecosystem.
  3. They oversee the creation and extraction of value for members.[12]

Therefore, the first research project to be conducted will be to identify if and how the TechQuartier is fulfilling the role of an orchestrator for the safeFBDC. A network analysis will be conducted in the first step. The results – the existing ties within the ecosystem – coupled with the second step, a cluster analysis of the activities carried out, should therefore determine the TechQuartiers role as orchestrator.

With that in mind we can have a look on how the mode of operation leads to the realization of the projects objectives, namely the development of AI applications. Instead of competition the project allows the collaboration in the provisioning and usage of shared, aggregated and uniformly formatted, cross-sectoral financial data. Such a concept of open strategy offers advantages for both affiliated producers and consumers.[13] Typically benefits for producers are lowered development and launch costs, quality improvement due to a joined development environment and increased speed to market. This, in turn, translates into the benefits of consumers since the reduced costs are reflected in the price (up to being open source) as well as a direct incorporation of feedback and implementation of specifications in the development cycle.[14] Since for the safeFBDC participants are often both – provider and user of data – an open strategy, triggered by the access to data, is of high functionality.

However, there also loom disadvantages which need to be tackled. In my GAIA-X post I already highlighted the loss of established business models and hence value appropriation. Accordingly, participants engaging in cooperation within an ecosystem have to find new ways to appropriate value within the value chain to generate profit.[15][16] Data monetarisation therefore is a research object of special interest to us. Hence, building on our first research project we will investigate how the TechQuartier, in its role of orchestrator, can determine and govern a value appropriation regime.

Together, Luisa Kruse and me are looking forward to report on our progress on both research projects in the upcoming months.

– Jonas Geisen, ESR


[1] Chesbrough, H. W., & Appleyard, M. M. (2007). Open innovation and strategy. California management review, 50(1), 57-76.

[2] This is based on Schumpeters (1934, 1939, 1950) work who expected that innovative behaviour is based on the profit expectations during the growth of an industry as the major determinants of a firms growth.

[3] Schumpeter, J. A., & Nichol, A. J. (1934). Robinson’s economics of imperfect competition. Journal of political economy, 42(2), 249-259.

[4] Schumpeter, J. A. (1939). Business cycles (Vol. 1, pp. 161-174). New York: McGraw-Hill.

[5] Schumpeter, J. A. (1950). The march into socialism. The American Economic Review, 40(2), 446-456.

[6] McKinsey and Company, 2015, Global Media Report

[7] Martín‐de Castro, G., López‐Sáez, P., Delgado‐Verde, M., Quintane, E., Casselman, R. M., Reiche, B. S., & Nylund, P. A. (2011). Innovation as a knowledge‐based outcome. Journal of knowledge management.

[8] Tan, F. T., Ondrus, J., Tan, B., & Oh, J. (2020). Digital transformation of business ecosystems: Evidence from the Korean pop industry. Information Systems Journal, 30(5), 866-898.

[9] Gooyert, V. D., Rouwette, E. A. J. A., & van Kranenburg, H. L. (2019). Interorganizational strategizing.

[10] Adner, R. (2017). Ecosystem as structure: An actionable construct for strategy. Journal of management, 43(1), 39-58.

[11] Spigel, B. (2017). The relational organization of entrepreneurial ecosystems. Entrepreneurship Theory and Practice, 41(1), 49-72.

[12] Dhanaraj, C., & Parkhe, A. (2006). Orchestrating innovation networks. Academy of management review, 31(3), 659-669.

[13] Chesbrough, H. W., & Appleyard, M. M. (2007). Open innovation and strategy. California management review, 50(1), 57-76.

[14] Appleyard, M. M., & Chesbrough, H. W. (2017). The dynamics of open strategy: from adoption to reversion. Long Range Planning, 50(3), 310-321.

[15] Hautz, J., Seidl, D., & Whittington, R. (2017). Open strategy: Dimensions, dilemmas, dynamics. Long Range Planning, 50(3), 298-309.

[16] Chesbrough, H., Heaton, S., & Mei, L. (2020). Open innovation with Chinese characteristics: a dynamic capabilities perspective. R&D Management.

Market reactions to acquisition announcements: The importance of signaling ‘why’ and ‘where’

Acquisitions are common in industries, but not all acquisitions succeed and those that fail often have a negative effect on the acquirer. A recent publication in the Long Range Planning further explores multiple levels of risks involved in acquisitions and the importance of signaling the ‘why’ and ‘where’ of said acquisitions.

Dr Rick Aalbers (Associate Professor in Strategy and Innovation at Radboud University Nijmegen and coordinating team member of the FINDER Project) teamed up with Dr Killian J. McCarthy (Associate Professor of Innovation at University of Groningen) and Prof. Dr Koen Heimeriks (Professor of Strategy at Warwick Business School) deep dived into the matter, which resulted in the publication of:

“Market Reactions to Acquisition Announcements: The Importance of Signaling ‘Why’ and ‘Where’”
Aalbers R., McCarthy, K. & Heimeriks, K. (2021)
Long Range Planninghttps://www.sciencedirect.com/science/article/pii/S0024630121000364

As acquisitions are risky events but not all acquisitions involve the same levels of risk, the authors suggest that the announced acquisition motive – the ‘why’ of the acquisition – is an important risk signal. In the paper they categorize acquisition motives and distinction is made between acquisitions with ‘pure explore’ and ‘pure exploit’ motives. Recognizing that most acquisitions have multiple motives, acquisitions with ‘ambidextrous’ motives – different combinations of explorative and exploitative motives – are identified too.
Building on recent contributions to signaling theory, it is argued that the ‘why’ will matter more, if the ‘where’ pertains to a high-risk setting. The authors measure this, using target-to-acquirer industry relatedness.

Findings:

  • The market reacts more positively to pure acquisitions, aimed at exploration or exploitation, compared to ambidextrous acquisitions.
  • The market reacts more positively to ambidextrous acquisitions orientated towards exploitation than ambidextrous acquisitions orientated toward exploration.
  • Relatedness moderates this relationship, in that the market is more willing to tolerate exploration in a related industry.

The authors core contribution is to the literatures on acquisition motives and ambidexterity. They provide new insights into the incidence of specific motives, the ways in which they are mixed, and the market’s reaction to their announcement. In addition, they contribute to the emerging literature that takes on behavioral perspective of market reactions by showing that the ‘why’ and ‘where’ of an acquisition matter.

Summary of the FINDER inclusive digital innovation in FS&I week

Last week, we hosted the FINDER inclusive digital innovation week in FS&I together with our project partner Atos. It was an exciting opportunity to exchange ideas between practice and academia and receive food for further thinking. We want to thank the organizers of the event, Remco Neuteboom, Rick Aalbers, Ivo Lujiendijk, Jonas Röttger, Catherine Dutton, Linda Buis, S. James Ellis, Ana Barroso, Belen Gonzalez Rodriguez, and Saeed Khanagha.

Thank you also to all participants! We enjoyed your excellent questions and the discussions.

Summary of the sessions

1. How to de-risk corporate-startup innovations while improving speed and cost? By Josemaria Siota

Josemaria Siota, Executive Director IESE Business School, explained how to engage in venturing as a corporation by pulling from his latest research report (available here). The session was facilitated by Nikhil Chouguley, Global Head of Product Governance & ESG Oversight at Deutsche Bank. Click here for a summary of the session.  

2. GAIA-X: The future of the European datacloud by Hubert Tardieu

Hubert Tardieu, Chairman of the Board of the GAIA-X AISBL, introduced the European business to business data sharing initiative GAIA-X. Click here for a summary of the session.  

3. Ecosystem dominance by S. James Ellis and Ivo Luijendijk

S. James Ellis, FINDER Ph.D. candidate, and Ivo Luijendijk, Industry Director Atos, presented their whitepaper findings on how to achieve dominant positions in ecosystems as a company. Click here for a summary of the session.  

4. Retail Banking transforms into Life-fulfilment services by Eddy Claessens and Jonas Röttger

Eddy Claessens, Industry Director Atos, and Jonas Röttger, FINDER Ph.D. candidate, laid out their vision of how retail banking will transform into a hyper customer-centric model in which customers interact with various industries through a banking portal. Click here for a summary of the session.  

5. Enabling next-generation customer insights & interactions in insurance through explainable AI by Jeremie Abiteboul

Jeremie Abiteboul, Chief Technology Advisor at DreamQuark, explained how explainable AI works, its benefits, and how DreamQuark is implementing it with customers. Click here for a summary of the session.

The digital business ecosystem GAIA-X – A session of the FINDER inclusive digital innovation week

At the second day of our Inclusive Digital Innovation in Financial Services & Insurance (FSI) event, we had a look on a European moon-shot project GAIA-X. For this topic we were happy to welcome Hubert Tardieu, chairman of the Board of GAIA-X, highlighting how the project will shape the future of the financial services and insurance market in Europe by “creating a next generation data ecosystem for Europe with a global aspiration”.

The kick-off summit of GAIA-X in 2020 consequentially focused on two major foundations for a project of such scale. First, the overall key concepts to achieve the envisioned cloud penetration of and in the European market were presented. These depict the five pillars of GAIA-X:

  1. Supporting policy rules derived from requirements of a European single market
  2. Support federal data infrastructures (methodology to synthesize different frameworks)
  3. Ensuring interoperability, sovereignty, portability of data
  4. Providing testable compliance to GAIA-X Architecture of standards
  5. Acknowledging open standard setting processes laid out in the internal GAI-X rules of the GAIA-X

Second, the projects governance structure was outlined. Both points reveal what is at the heart of GAIA-X: creating a digital business ecosystem for open innovation.

GAIA-X – digital business ecosystem by design

The professional literature[1][2][3] highlights a couple of design principles to achieve a successful setup of a healthy digital business ecosystem. The summit therefore was existential to growing legitimacy by presenting that GAIA-X is shaping its governance based on these, interdependent, design principles:

  • Demand orientation; stating a mission allows enthusiastic actors to push into the ecosystem instead of pulling them in securing pro-active, responsive behaviour for the joint value creation
  • Openness; in form of a transparent environment enabling an easy access
  • Self-organization; enabling participants to act autonomously to increase commitment
  • Loose coupling; so that participants can join freely and engage in open relationships so that there are no heavy dependencies determining the success of conducted projects
  • Domain clustering; enabling the grouping of participants in projects based on shared interests

Advantages of GAIA-X as a digital business ecosystems

Mr. Tardieu sees a major benefit of GAIA-X in the enabled Europe-wide collaboration between private and public sector. First, the initiative allows to jumpstart the facilitation of digital competence of European companies and thus of Europe as well. Second, it enables European-centred research hand-in-hand with practitioners which in return enables more precise policy-making. Third, the collaboration allows for a holistic approach since it is the only project that is addressing all the necessary elements together from root-to-tip. The initiative captures the alignment of technical standards and services for interoperability and portability (the roots) through the federated trust and sovereignty services (trunk) up to the definition of ontologies, APIs and technology standards for compliance (leaves).

“Gaia-X may seem gigantic but we don’t think that the big issues we are trying to tackle can be ‘sliced’ into smaller parts. In Financial Services and Insurance, this is especially true at a time when cloud adoption needs to accelerate and there is so much change within the industry.”

Based on these the concept of open strategy, nested in a digital business ecosystem, offers advantages for both affiliated producers and consumers.[4] Since for the GAIA-X participants are often both – provider and user of data – the approach taken by GAIA-X is of particularly high functionality. Benefits for data providers are lowered development and launch costs, quality improvement due to a joined development environment and increased speed to market. This, in turn, translates into the benefits of data users since the reduced costs are reflected in the price (up to being open source) as well as a direct incorporation of feedback and implementation of specifications in the development cycle.[5]

Challenges identified, faced and tackled

Nevertheless, open strategizing also presents those involved with the challenge of finding of losing established business models of value appropriation. In the case of GAIA-X, there are two factors that endanger common business models of participants:

  1. The lower costs (should costs be charged) of developed services or products are passed on directly to the user of the data. This significantly reduces the achieved profit.
  2. Differing ownership of input data, managed through data sharing agreements and data use statements, impedes the distribution of the benefits achieved.

Hence, participants have to find new ways to appropriate value within the value chain and thus generate profit from their engagement in the digital business ecosystem.[6][7] According to Mr. Tardieu the participants at GAIA-X are fully aware of that challenge:

Of course, our concern is how do we create data spaces in which those involved will be able to further their own interests too. We also think about how those who put the most effort in from the start don’t lose out to those who might join later when the hard work is done. We reject the idea of selling data. It is an old-fashioned way of thinking.

Part of this process is the integration of researchers as they are developing novel ideas to tackle this challenge. A recently idea explored is the approach of ‘Tickenomics’, originating at the University of Toulouse. The underlying mechanism is illustrated by Mr. Tardieu through an analogy:One example [of Tickenomics] would be to suppose you are in a place with no transportation system. You are selling tickets (or lots) to travellers, to towns and to whole regions. At some point, you will have enough money to create the transportation system. And that is when the tickets become valuable. It might be slow getting started but as soon as everything is in place, it takes off quickly. So we are looking at ways we might introduce ‘tickets’ without the possibility of these leading to monopolies.”

Furthermore, open strategizing[8] allowed the participants of GAIA-X to identify the following barriers which hinder the successful realisation of the visionary mission:

  1. The absence of portability (also known as vendor lock-in or the risk of ‘mainframe syndrome’) – preventing companies from committing to cloud due to future risk.
  2. The potential lack of interoperability – whereby differences in the technical infrastructure may hamper or even render data sharing impossible
  3. The importance of data sovereignty – as otherwise companies would refrain from moving to the cloud due to the risk of misappropriation of shared data.

At the same time the mission-driven initiative also produced a mode of operation to tackle these barriers according to Mr. Tardieu: “The challenges of data portability, interoperability, and common commercial and legal frameworks have different implications for different industries. That is where GAIA-X is helping participants come together to define use cases for their industries and to share information that can make industry data spaces possible. This collaboration is important.”

GAIA-X enables mission-oriented work in industry-specific projects

With the mission, design and barriers of the digital business ecosystem being fleshed out, naturally, the question occurs how GAIA-X will manifest itself through the realisation of projects. Mr. Tardieu pointed out that therefore the domain clustering is of importance as it defines groups to create “data spaces” on an industrial level. Therefore, the FSI industry is a prime pilot since, due to the high level of regulation, collaboration between participants of the public and private sector is required when tackling the challenges of data portability, interoperability, and common commercial as well as legal frameworks.

By working together, they (public & private actors) can increase the chance of success. And this isn’t just about sharing data, remember. It’s also about infrastructure too. Especially where regulations dictate compliance at a local level. You can’t just do it at the application level. This is something GAIA-X is working on.

Furthermore, he lined out that the FSI industry “is ‘ahead of the pack’ because of PSD2 (for a brief overview of PSD2 see this blogpost). We wouldn’t have seen the huge development of FinTechs without it. But this is only half of the work. Data ontologies are key and you will soon see the priority use cases from the financial services and insurance sector start to emerge based on GAIA-X projects.”

The first pilot project – the safe Financial Big Data Cluster – investigating the use case of a joint platform to fuel artificial intelligence services, is currently developed by participants of the private and public sector with involvement of FINDER (for an introduction see this blogpost).

Added benefit to the FSI industry through GAIA-X

While there are different initiatives (for instance, the EU Alliance for Industrial Data and Cloud) Mr. Tardieu sees the benefit of GAIA-X in its holistic approach since it is the only initiative that is addressing all the necessary elements together from root-to-tip. The initiative captures the alignment of technical standards and services for interoperability and portability (the roots) through the federated trust and sovereignty services (trunk) up to the definition of ontologies, APIs and technology standards for compliance (leaves).

“Gaia-X may seem gigantic but we don’t think that the big issues we are trying to tackle can be ‘sliced’ into smaller parts. In Financial Services and Insurance, this is especially true at a time when cloud adoption needs to accelerate and there is so much change within the industry.”

We will be looking out in the future to see how GAIA-X and its pilots will develop thereby changing the European Financial Service & Insurance industry. Stay tuned for more in the future.

Jonas Geisen, ESR


[1] Boley, H., & Chang, E. (2007, February). Digital ecosystems: Principles and semantics. In 2007 Inaugural IEEE-IES Digital EcoSystems and Technologies Conference (pp. 398-403). IEEE.

[2] Adner, R. (2017). Ecosystem as structure: An actionable construct for strategy. Journal of management, 43(1), 39-58.

[3] Tan, F. T., Ondrus, J., Tan, B., & Oh, J. (2020). Digital transformation of business ecosystems: Evidence from the Korean pop industry. Information Systems Journal, 30(5), 866-898.

[4] Appleyard, M. M., & Chesbrough, H. W. (2017). The dynamics of open strategy: from adoption to reversion. Long Range Planning, 50(3), 310-321.

[5] Chesbrough, H. W., & Appleyard, M. M. (2007). Open innovation and strategy. California management review, 50(1), 57-76.

[6] Hautz, J., Seidl, D., & Whittington, R. (2017). Open strategy: Dimensions, dilemmas, dynamics Long Range Planning, 50(3):298-309

[7] Chesbrough, H., Heaton, S., & Mei, L. (2020). Open innovation with Chinese characteristics: a dynamic capabilities perspective. R&D Management.

[8] Gooyert, V. D., Rouwette, E. A. J. A., & van Kranenburg, H. L. (2019). Interorganizational strategizing.

Enabling next-generation customer insights interactions in insurance through explainable AI – A session of the FINDER inclusive digital innovation week

In the last session of the FINDER inclusive digital innovation week, Jeremie Abiteboul, Chief Technology Advisor at DreamQuark, explained how explainable AI works, its benefits, and how DreamQuark is implementing it with customers.

What is explainable AI?

Explainable AI refers to making the decision-making process of a machine-learning model transparent and understandable for a human observer. This includes which data has been used as an input and which variables are proportionally contributing to a model’s decision.

Why do we need explainable AI?

There are multiple reasons why explainable is needed. Firstly, we need to know if input data is biased because that leads to bias-reproducing AI. Secondly, we need to know which variables the model is attributing the most weight to since these could be variables that discriminate against particular groups of people. Thirdly, having an explainable AI model enables companies to address accountability and to be prepared for regulatory reporting.

How to implement explainable AI in insurance?

The prominent business cases that AI in insurance addresses are cross-selling and up-selling, targeted recommendations, and churn prevention. Explainable AI in insurance (compared to non-explainable AI) enables customers to have increased trust in the AI system, validate the business relevance of the model, discover new insights in the data, check for variables that should be excluded, and use it for regulatory purposes.

Contact

If you would like to learn more about explainable AI in insurance, please reach out to Jeremie Abiteboul.