Banking & Insurance

Bridging the data ‘achievement gap’ for financial services

New digital banking white paper highlights weaknesses in today’s customer information strategies

Every financial services organization today understands the importance of data maturity. Data maturity is about maximizing the value of your data to answer business questions, empower employees and deliver an improved customer experience. But there’s a major gap between where banks are and where they want to be.

Most financial institutions are striving to combine external data streams and information with existing internal data sets, applying advanced analytics to build a foundation for faster decisions and better consumer insights. They also seek to measure data maturity and democratize data so that information and insight is no longer solely the province of data scientists and analysts.

According to Jim Marous, Owner and CEO, Digital Banking Report and author of the white paper, the answer to these challenges may lie in customer information management. “With strong customer information management, advanced platforms, supportive leadership team, data-driven culture, and data democratization, team members will be encouraged to use the same dataset as all others in the organization to make decisions, serve the customer better, and streamline back-office processes,” says Jim.

The latest Digital Banking Report white paper, sponsored by OpenTextBuilding a Solid Data and Information Strategy—exposes weaknesses in the current environment that the Customer Information Management (CIM) solution can resolve. Here are some of the findings.

Crossing the chasm

Research by the Digital Banking Report has found that most financial institutions do not rank themselves highly on data maturity. While most organizations appear to be comfortable with data quantity and their ability to store data, only 27 percent ranked themselves positively for data accessibility and just 26 percent did so for data quality. And fewer than one in five were happy with their ability to deploy data to where it is needed.

In fact, the white paper finds that over 50 percent of organizations are faced with many disconnected systems when serving their customers—only 7 percent reported having one system that can do everything (see Figure 1). This is potentially disastrous for a modern digital business. When the back office is unable to support a single, 360-degree view of the customer, it’s almost impossible to empower employees to serve customers, build trusting relationships, develop personalized communications and make decisions using customer insights.

Figure 1

Today’s data platforms are missing their mark

We have to face up to the reality that the financial services industry is falling short on data maturity. According to the Digital Banking Report, only 12 percent of organizations believe they have the level of data and analytics needed to drive a positive experience.

Instead, many organizations are relying on the current generation of data platforms, which they find inadequate for their purposes. In all, 62 percent of survey respondents said they were dissatisfied with their current platform—only 4 percent were highly satisfied (see Figure 2).

Figure 2

Let’s be clear: Financial Services executives are pursuing data maturity and they have a clear understanding of what they want from their customer data platforms (see Figure 3). The problem is that many currently available customer data platforms can’t deliver the required customer information management capabilities.

Figure 3

Redefining CIM for financial services

From transaction and account-level balance data, to behavior and trend data, the quantity of data is not usually the problem. The challenges lie in collating data from multiple sources within the organization, developing robust models and use cases, selecting the data to be used, interpreting analytics and—most important—deploying business insights for use across the organization.

To meet these challenges, it’s not enough to use a traditional customer data platform (CDP) that extracts, transforms, cleanses, analyzes and stores data. Instead, banks need to look to the next generation of CDP—such as OpenText Customer Information Management for Banking—to bring together multiple disparate data points and create a unified, holistic approach to internal business cases and external customer interactions.

For example, banks using our Customer Information Management for Banking from OpenText gain a 360-degree view of the customer. This enables consistent sales and service interactions across the entire organization and partner ecosystem, with key benefits such as:

  • Better customer and employee engagements
  • Increased customer trust and loyalty
  • Digitized and automated processes for customer engagement and experience
  • Improved data quality and accessibility
  • Higher levels of service personalization and customization
  • Lower total cost of ownership per customer
  • Improved KPIs and service-level performance

Tomorrow’s customer data platform

Many banks and credit unions today are still using customer data platforms for basic requirements, with a focus on data collection and analysis. But reaching data maturity requires significantly more. Banks need a flexible enterprise platform that can deliver a single view of the customer and democratize data to deliver insights directly to the people who need it.

You can read the full white paper here: Building a Solid Data and Information Strategy. To learn more about Customer Information Management for Banking from OpenText, visit our website.

Monica Hovsepian

Monica Hovsepian is the Global Industry Strategist for Financial Services at OpenText. With more than two decades of financial industry experience, Monica has become a trusted subject matter expert in the Financial Services Industry, having worked with numerous large and international banks in North America, Europe and Asia.

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