H2O WORLD: INDIA 2023
Fireside Chat with Dr Andrew McMullan, CommBank & Sri Ambati
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Sri Ambati:
Welcome Andrew McMullen to the stage. It's routine for Andrew to have me on a fireside chat on stages globally. So it's apropo for us to do the reverse this time. Thank you for spending time with us as well. And how has the trip been so far?
Andrew McMullan:
You're really good. And good morning everyone. Good morning, Sri. I'd actually like to begin by paying my respects to the elders both past, present and emerging, and pay my respects to the community leaders who've helped pave the way for us to be here today. That's a traditional welcome we have from Australia Sri. So I wanted to do that for the team. I know some of the CBA team are here and just open with a little bit of respects,
Sri Ambati:
Very rich tradition, and I think I was quite smitten by the tradition during my trips to Sydney and Melbourne and other parts. So, Canberra. I know there's a few questions, but I'll probably start with your journey. You're super inspiring. By your incredible journey both all the way from Highland, Scotland, all the way from England and here. Give us probably a brief.
Andrew McMullan's Why
Andrew McMullan:
Yeah. Look. Well, my personal journey I was actually born in a little country called Northern Ireland. The youngest of seven children. I often tell my team it's a mathematical challenge that I set them to think about whether or not it's actually possible to have seven children born. I'm the youngest, the gap between me and the oldest is less than eight years.
And actually, I grew up in Northern Ireland in the seventies and eighties. I know one of the things you and I often talk about was a lot of things that I probably saw and experienced as I was growing up in that era always led to this inner sense of trying to make a difference. I saw many things that I felt there was a lot of inequality, injustice et cetera that I experienced in the seventies and eighties as I grew up. And then as I went to university and realized maybe I had a mathematical, a little bit of mathematical talent, I did a master's and a PhD in machine learning. As it turns out in the late nineties, early two thousands. I was determined to try and use that to try and make a difference for as many people on the planet as I could.
You and I have talked about that on a personal level for a few times about our joint connection and making AI for good not only serving all of the wonderful customers and communities that we serve with ComBank in Australia, but how do we make the difference for as many people on the planet as we can for all of the things that we care about to be good and true? Early in my career, academia, then in financial services, probably nudging at a story for those of my team. I apologize that you're going to hear about my mother-in-law again. I was driven by this story my mother-in-law told me when I joined the Royal Bank of Scotland, about 15 years ago. And as I joined the Royal Bank of Scotland, my mother-in-law told me this story, which was something like, I've always banked with the competitor of the Royal Bank of Scotland.
The Bank of Scotland. And the reason that I have always banked with them and will always bank with them was because they knew me and looked after me in the moments that really mattered. And she told a story about when her daughter, who's now my wife, was at university, and she was due to have payments or grants go into her bank account and they hadn't arrived, but she continued to spend and had racked up some fees and charges. But when my mother-in-law went into the branch, the branch manager knew her and asked her if she had some time to go out back, and they then solved it by moving some money into my wife's account and removing all the fees and charges. And she said at that moment when the bank really needed to help her and her family, they were there for her.
When I joined the World Bank of Scotland, and I sat down with the CEO at the time and said, given that we've got 17 million customers, the only way you can possibly ever do that is to use our data to create that understanding and connection to customers so that in every interaction you can look after them in the way that the bank looked after my mother-in-law. So I've been driven with that purpose for the last 15 years. And I would probably add to that, that I think the Commonwealth Bank of Australia are easily the best organization at trying to do that, to make every interaction that we have with our customers, personal, relevant, important, and meaningful to the customer, not just the organization
H2O.ai As A Partner In Commonwealth Bank
Sri Ambati:
I can vouch for that. From having been a partner for a short time. Every interaction I've had with almost everyone in the Commonwealth Bank starts with customer and community, and they're almost used as one word and all the way to your senior most leader, to the board, to even the tellers who are beginning to become data scientists. Across the board, a very, very, customer obsessed organization.
Andrew McMullan:
Yeah, if I could Sri build on that, I know some of the team are here. I was with the CBA team in the office yesterday. And just to bring that to life, one of the analytical teams had spent some time pulling together, a little bit of a montage of the customer experience and how AI was helping all the way. It was really excellent to be part of that, to just kind of show that even with the team here in India, how connected we are to the customer from an onboarding and KYC experience to trying to buy your first home and furnish your first home and have a credit card. And as they showed that whole customer journey and experience, they were able to then play through how AI and data was playing a really important part in it, which was really cool.
Sri Ambati:
Fantastic. What an amazing story. What an inspiring journey. How else is AI beginning to see its value in different spheres in the bank? What are some of the highlights? I mean, I know at H2O World, Sydney, we saw you talk about how the CMO and the COO are beginning to use our technology AI to even move the needle at different business levels. What are some early wins and what are the challenges ahead?
AI Improves Customer's Experience At CBA
Andrew McMullan:
Yep. In terms of how we need to use AI to deliver against our strategy, and actually I should start to correct another ChatGPT, which, I think described Westpac as being the largest financial services
Sri Ambati:
It was hallucinating.
Andrew McMullan:
Yeah. Hallucinating. And just for the audience who maybe don't know as much about Commonwealth Bank of Australia, we are the largest financial services institution in Australia. One in three Australians would call the Commonwealth Bank of Australia their main financial institution. We are almost 30% of the market share in home lending. Number one in credit cards. Number one in deposits. Maybe 10 years ago Westpac, I think at that point, we're the largest financial services institution in the world. And I don't think it's a coincidence that in the last 10 years since CBA has started to invest in AI machine learning and our customer engagement engine, we have started to pull away from the competition in Australia and differentiate the service experience and offering that we have for our customers in Australia. And I can't think how it would be possible to do the great things we do for our customers or for any organization that's got that size of a customer base to do the things that they want to do, to be personal, relevant, to make the right offers and decisions. Without using AI and machine learning and without partnering with someone like H2O.ai.
Sri Ambati:
We feel privileged to be partners. A lot of the wins that H2O has usually comes from a native leadership and culture that's already looking to transform. What kind of, and obviously for the audience, what kind of bridges and organizational culture that enabled a bank to, I mean, we work with several banks in the world, and we actually put Comm Bank in the forefront of bringing change reasonably fast. What is the source of that success?
How CBA Became Early Adopters To AI For A Better Customer Experience
Andrew McMullan:
Yeah, that's a good question. I'd love to try and pretend that I had anything to do with that but the trustful answer is that the leadership of the organization, and in particular our CEO were truly customer obsessed. I joined CBA about six and a half years ago exactly for that reason. At the time, the leadership team and Matt Comyn, who's the chief executive officer, wanted to build a customer engagement engine, which you know the vision of what he wanted the organization to do and be. How do we connect all of the data and information we have about our customers to ensure that we know and understand them across every single channel and interaction? And I want to make every interaction better. That was about six and a half years ago. I don't want to steal the thunder of Dan and the team who might be talking. Dan and Neti are coming on the stage later to talk about some of the things that we do with the customer engagement engine. But I mean, if you think about everyone in the crowd today, you must have a mobile phone. I'm assuming and on your mobile phone, you must also have a banking app. If everyone takes out the mobile phone and opens up the banking app. And as you navigate through a few of the different areas within the banking app, what do you think's happening?
And if you bank with the Commonwealth Bank of Australia, I'll tell you what's happening. And I'm very confident that we're doing it better than other organizations because of that vision of the leadership team. Every time our customers open the app, there's a call to our real time engine to say, Andrew's here, what's the best experience or offer or interaction we can have with him right now? And as I navigate every time across every page, an asset in the app, it's making a call to make sure that the most personalized, relevant offers or experiences are being displayed in my app. Now, that's happening across our customer base over 50 million times every single day where customers are getting a personalized experience in real time from us. So, you know, Sri, we run over a thousand models in real time, across 157 billion data points to make personal and relevant experiences available to our customers across all of our different channels.
It probably peels into insignificance when I heard Andy from AT&T talk about, I think, the 590 petabytes of data that AT&T gets every day. I could see my team looking and feeling a little bit nervous when he was talking about that scale of data. But, for us every single interaction, Sri, and I think the organization asked us to think about it in a way customer first, customer obsessed. And every time a customer interacts with us across our channels, can we make them smile?
Sri Ambati:
Yeah, no, that's an incredible comment there, sort of how do we make the customer enjoy this source of all activity in life. So making customers happy is a shared obsession for us. When you touched on a couple of interesting themes there. What kind of data is in regulated industry banking? Many of my customers typically are, I mean, we will hear from Wells Fargo later today on a similar topic of how to get machine learning to sell, and we have others there. So, how is CBA building a more regulated way or more responsible way of building AI to sell customers?
How CBA Is Building Responsibly With AI
Andrew McMullan:
Yeah, really good question. In terms of being responsible for every single model that we've ever built in the organization, we've always thought about making sure that we could explain and understand the decisions that we were making. At Commonwealth Bank, the team was involved with the government of Australia. We were involved in pulling together the ethical principles of AI for Australia. So that was in 2019, I think. All the way along, as an organization, every time we've thought about building models, using machine learning, using AI, we've always had a set of principles. A principle based approach, a governance model in place. That means that we can always understand all the decisions that we're making. We can always explain what the models are doing always with transparency in the model governance. We have model performance management and drift. We test for bias. It's the way that we've always thought about it as a responsible organization to make sure that we meet the obligations of how we serve our customers.
Sri Ambati:
That's amazing. Yeah, it is strategic, very strategic to the bank. What are some non direct to the bank applications that the team has built? I know, along with the partners, we saw for example, both from an AI for good perspective to even helping during the last one year of oil prices, which were fluctuating quite a bit for your customers.
CBA Building AI For Non Banking Applications To Benefit Customers
Andrew McMullan:
Yeah. I think the good news is that there are so many examples to choose from. I think the team has done a really great job. Again, I heard Andy talk about democratizing AI and as you all know, we've had over a thousand people in the organization who have gone through H2O training. We have helped them learn how to use the driverless AI as an example. So there are many use cases, and we have well exceeded the number of licenses that we originally agreed that we would use in our partnership. So, I know we're talking to you about how we make that available across all of the enterprise. And look, the brilliant thing about H2O, Sri, is it is so easy to be like, with the right logic and the right care and obsession for customers.
I believe anyone in our organization can learn how to use the driverless AI capability within H2O and we partner them with the right support. The team talks about how we have AI ninjas and we're really building momentum and making sure that every part of the organization is thinking about and using AI to deliver better customer outcomes and experiences in everything that we do. My favorite examples, if you want me to share a couple of things that we've done in the last 12 months, actually, as I was traveling here, I came over on Sunday to spend some time with the team before the event today and on the weekend there were natural disasters in Australia. Australia's an incredible country. Having lived there for over six years, I hadn't quite realized how impacted the country is by natural disasters if it's floods or bush fires or cyclones.
So at the weekend, there was a cyclone and as I was getting on the plane and this Sunday a small number of my team were working to make sure that any customer who was potentially going to be impacted by the cyclone and natural disasters in Western Australia were notified before the event to let them know everything that was available to them. From the Commonwealth Bank of Australia, we have an emergency assistance package, which is tailored to every customer, depending on what you have with us. If you have a home loan, you can take the Ferrells. If you've got a business you can get access to immediate loans, et cetera. So, all of that is available, but we just let customers know in case they get impacted by that. And the way that we do that, it was the team who came up with it because of the impact of natural disasters across Australia. The team identified all of the different weather systems that exist across Australia. All the states and territories built a real time weather asset model that we use to feed into our customer engagement engine, which notifies customers about potential natural disasters before the event. And in many of those natural disasters, actually we've heard from customers, there was a bushfire story, or I remember one of our customers afterwards told us that the Commonwealth Bank of Australia had contacted her and helped her before any of the emergency services assistance teams in Australia.
Sri Ambati:
That's amazing, amazing. AI truly helps save lives. As an organization, I had to do the same explaining in Silicon Valley why Commonwealth Bank of Australia is one of the most foremost banks and organizations with the customer and community focus. In fact, you won us over with the offer to co-create bushfire fighting or predicting bushfires. You heard Matt say at the last fireside chat in Sydney, how can we create more grand masters inside ComBank and what is the plan that you have?
Future Of Kaggle Grandmasters At CBA
Andrew McMullan:
Well, I think you know that I'm on record as saying that in the partnership with H2O and having access to the Kaggle Grandmasters as well as the machine learning engineers and the experts that you've had to co-create some of the products and solutions that we've built together. It's certainly given our team and our organization a taste for working with the best talent on the planet today. And we have a desire to create some of our own Kaggle Grandmasters at the Commonwealth Bank of Australia. Some of my leadership team who are here today, I've made them feel very nervous by saying that in the next 12 months I want to have our own Kaggle Grandmasters at the Commonwealth Bank of Australia and very confident that with the partnership that we can make that happen together,
Sri Ambati:
We will be privileged to be able to partner with you on that. And I think shout out to the Grandmasters, some of them in the audience, at one of the largest gatherings of Grandmasters in India recently. We have the world number four who's going to be on stage. Pascal, who was demoing some of his work. We're pulling it together at the last minute. Shivam and others as well in the audience. But the highest ranked Kaggle Grandmaster in India is number 17 or in the 20. So we need to change that, we need to bring them into the top five. So, it'll be a personal goal and all the customers in the audience will hopefully help us bring India into the top 10 out of five ranks.
Andrew McMullan:
Yeah, for sure. I mean, if I can do a little plug. The managing director of CBA India is here with me today, Pankajam. If there are any aspiring Grandmasters in the audience today, or if there are any Kaggle Grandmasters who are here, come and hit me and Pankajam up afterwards and we can have a conversation about how cool it would be to join the best financial services organization in the world.
Sri Ambati:
Tell us about it, I know it's kind of a cliche. We actually think that some of the most forthright, forward leaning organizations are not necessarily the most subtle. They're not necessarily the most popular ones. So the loudest ones. We had a difficult time saying no to traditional hedge funds, but saying yes to customers. And that was common. We'd done it so many times it was easy to do. But talk to us a little about how you found the company in Silicon Valley and then wanting to join our board and wanting to inspire us to do something that's long, long as well, probably speaking from H2O's standpoint.
H2O and CBA's Common Interest In Customer Care
Andrew McMullan:
Yeah, that's a great question. And I think, you know, even on a personal level, the time that you and I have spent together and, the things that we talk about and the care that we have for trying to make a difference for as many people on this wonderful planet as we can, and Commonwealth Bank of Australia is exactly like that. The care that we have for the customers that we serve and the communities that we have the privilege of being able to represent is everything that we stand for. As we started to talk to H2O, it was really clear that our organization, that the culture that you had and the care that you had for your people and the talent and the things that you wanted to do to make a difference for people matched what we wanted to do with our data and AI capability at CBA.
So there was as much an aspiration to be the best in the world together as there was a connection of our cultures as well as if anyone notices a very similar brand coloring. It felt that, in those early conversations and negotiations, we really were well suited culturally as well as capability-wise to go on and do great things together. And, even though I think 18 months we've been in partnership together, we invested in the last round with H2O, we are unbelievably pleased with the partnership that we've had. The biggest reason that we wanted to be part of that, not that the platform is incredible, the talent is incredible, the cultures are aligned, but the results that we were getting pre that round of investment were the best thing that we have ever seen in our banking career in terms of building models to make better decisions for customers.
And I remember probably about three and a half years ago the team were doing a proof of concept as you know, where we were looking at using H2O.ai and comparing that to all of the main competitors that you could think that were in the market at the time. And every single example we built a model with H2O it was significantly better than anybody else that we were comparing it to. To the point, at the time, a lot of people in the organization who were a little bit skeptical were like, we're not sure about this. It doesn't feel like this is real. It's like you get your traditional modeling folk here. We're convinced it's overfitting. We're convinced there's something awry here. And as we just spent time trying to understand that, what we realized was you had assembled some of the best data scientists on the world to build models and use engineering to make those models available to us on our data in a way that was just more difficult for us to be able to do with the natural way of coding that we traditionally approached it. And ever since that I say that Neti and Dan are on the stage leader, they'll give you some of the results and use cases, but I think the average improvement on the models that we build with H2O against what we replace is a hundred percent better on average.
Sri Ambati:
Kudos to the team, right? So do the makers of H2O, pouring relentlessly art and time and as you saw with our work on GPT is just getting started. So hopefully, the folks that need to watch out are going to see us in a couple of years and see where accuracy is just as important, the generative aspect. A lot of this was co-creation as well. I mean, do you want to touch a little on where obviously creating more Grandmasters together would be great. Product we could build together. How do we make Australia and AI First Nation? I mean, we are a global company and AI without borders is how we think about the world.
Co-Created Products And Services
Andrew McMullan:
Yeah, I think, so as part of our partnership, one of the things that we were really keen to make happen was that we co-created products and services together, but also had some dedicated access to the team at H2O so that we could learn from your team and vice versa. We could work together and build products together. Because we have obviously the domain expertise of financial services in Australia. You've got a lot of the platform engineering and AI expertise that we had, but we were building. It's always been a complete partnership. We've always had teams that are a mix of H2O and CBA and that cultural but also talent alignment is why we're seeing some of the great results that we're seeing. I think that you've heard me say a few times people make magic happen for our customers. Ultimately, most organizations have got similar data sets and similar systems and can apply similar AI and machine learning. But if you've got the right approach and cultural alignment and desire to make a difference for customers that's what makes a difference for us.
Sri Ambati:
People live longer than companies and I've seen you. I've heard your quote a few times now. And hopefully the community builds great people, culture and products and purpose will drive us there. Anything fun you're doing here? Have you tried the micro breweries of Bangalore?
Andrew McMullan:
Yeah, I'm actually having a lot of fun. I spent the last two days with the team in the offices in India. We've got CBA Australia, which is based a few kilometers down the road. So, actually just being able to spend time with the team. I insisted, sometimes when the senior executives come over to India there's a lot of showcases and time. I was like, all I want to do, I want to clear every day so that I can just walk the floor and spend time with the team. I've had a wonderful experience doing that, getting to know the team, getting to understand the incredible experience and expertise that we have in the team in India, as well as the connected care for customers that exists. And, shout out to Pankajam and the team. They've done such a brilliant job. I'm looking forward to you coming into the office tomorrow because you will see, feel, and believe that you're actually in Sydney, when you're with the team tomorrow. Such a great job the team have done here.
Sri Ambati:
I'm beginning to believe in Alice in Wonderland where everything is just a warp away in Bangalore. You can just literally tunnel to whichever part of the world you want to right here. So super excited to both be building the community here.
Andrew McMullan:
You know, I think, I would build on what Andy said earlier as well. I mean, Australia is a wonderful country. It's like 25 million people in Australia and the access to the talent and capability and experience, we just don't have what we need to be really successful in using our data and AI to do brilliant things for our customers and communities. We simply had to come to India with the talent and experience and expertise that is here, and over two years for us from a data point of view and couldn't be happier with the incredible capability and expertise and experience we have in the CBA team here in India.
Sri Ambati:
And, as the saying goes, it's just getting started, right?
Andrew McMullan:
It really is just getting started.
Sri Ambati:
So, super excited. Easily my favorite customer, partner and one of my favorite board members. Thank you for the privilege of a fireside chat with you and in India. I look forward to spending some more time in Bangalore, but also shortly in Sydney. And what an inspiring journey. And it's super, super exciting to bring that story to the wider audience and community in India. So thank you.
Andrew McMullan:
Thank you, Sri. Thank you for your partnership and thank you for having me.