Top Banking trends for 2015 – Data and Analytics
Here is my list of predicted trends in banking analytics in 2015 .
Another year of significant growth in analytics is envisioned driven by regulatory mandates and growth of social intelligence.
1 Visualization . It is still early in the cycle for visualization technologies
With employees getting access to all this risk ,finance and customers data- making more sense of it in a digestible way is key to build business value . Turning data into beautiful ,readable charts and visuals helps tell a story ,support a point or
make a business decision easier . We have way further to go in empowering people to turn data into beautiful stories about their insights and thoughts on recommended actions.
2 Managed Data Discovery takes hold
Employees have self-service access to data but this
has it many instances lead to
hundreds of data sources beyond the control of IT as business increasingly
takes decisions on analytics tools selection . Indeed with data discovery
tools IT has lost control over many analytics deployments to business and a new
way to govern and control data by IT is needed whilst still
empowering business employees with the data to make risk or operational
decisions . Data governance will be a key trend for 2015 as banks IT teams
better govern the lineage , access and distribution of data
3 The demand for cloud analytics is real and growing
. In banking this driven by the right use cases , with strong
emphasis on protecting client data . New use cases are emerging in
customer area , HR and compliance , and trading counterparty areas that can hold the data in the cloud and the use power of business networks to share critical data has major value .
4. Predictive analytics for everyone .
New easy to use tools to create predictive models are increasingly available .
These can be integrated in an intuitive way with existing BI reports or
dashboards using real time data . Imagine pressing a predict
button on your BI report to show likely attrition on your customer base over
the next year ? As business people use predictive more and more new
levels of business insight will help add value to the business
5 The grow of data scientists as key role in the bank .
For deep analysis banks will need to employ many more data scientists
to look for hidden insights in customer and risk data . Real time data in huge amounts banks will lead to banks divesting tellers and investing in lots of data scientists . Banks differentiation in the digital future will not be operational processes
but the harnessing of data to win.
6 Risk and Finance data integration gathers pace
. Regulations are forcing the pace here . Two silos of risk and finance have
their own data hierarchies leading to duplication and reconciliation challenges.
Having one source of the truth for finance and risk has huge benefits and
costs savings for regulatory reporting and reducing the hundreds of
people doing reconciliation between systems. Regulators want to see data lineage
back to source systems and data compliance issues resolved through simplified
processes . The data quantities are huge but if they all used the same data
model it would be way simpler . Major banks will start adopting this year
7 Social intelligence on customers moves to action phase
.Many banks having been capturing and monitoring social conversations on their
products , service and offerings .They have detected the sentiment of their
customers but not moved to using to it sell to customers . Now driven by the
new digital banks and increasingly integrated social and CRM offering banks can
track and cross sell to clients based on their social messages and actions.
One Australian bank in a trail last year was able to track disgruntled
customers of competitors and make them offers to switch . This
created a strong ROI and I see other banks using social to sell
not just monitor in 2015.
8 Market and Trade surveillance will develop in regulatory field .
‘Libor’ and ‘Foreign exchange’ fix scandals in 2014 were met with record fines …Regulators are now enforcing a new era of fit for purpose compliance systems to
better manage market manipulation in real time . This will drive
acceleration of holding data in memory and using complex fraud and
pattern matching analytics techniques and investigating ,monitoring and visualising metrics on individuals and their actions to create early warning of suspicious activity
9 Banks scramble to complete intraday liquidity analytics in time -
With banks needing to be up and running by 1 /1/2016 and fully
compliant by 1/1/2017 for intraday liquidity reporting . However, a
recent survey by Swift stated 32 % of banks still have to start the project.
Intraday Liquidity reporting is a huge analytics and data challenge that will continue to consume resources and analytics know how in 2015.
10. Industry of things starts with strong use cases in financial services . Lots of hype here but the challenge is finding compelling use cases that drive ROI. Insurance has found these already with black boxes in cars .The drivers
style of driving is recorded and feedback in regular emails, texts and value added ways to increase safety but at same time ‘give back’ to the driver value added analysis ,ranking data on their abilities and at the same time saving money to their back
pocket . With new Health wearables ( Jawbone) similar models have merged using data as the key ‘weapon’. Banks will start driving more of these value added information centric services in 2015 by using mobile, location ,mapping and real time offers to find
a winning formula to excite customers and improve service and engagement with digital users.
Analytics has stayed at the top of IT and business priorities for over a decade now and show no sign of letting up. Differentiation in the digital world will
increasingly be achieved my insights in data being applied well via the front
line employees . The question of data privacy and security will still be key as
data in increasingly used across the bank and regulators clearly understand a
lot of the regulatory mandates will require a firm management of data
lifecycle within a bank to be successfully implemented. In 2014 we completed a
survey of what bankers believe are the key drivers and areas for big data and
analytics to make a difference to their business . Why not click to see the
full EIU survey results here and see their views ? http://www.sap.com/solution/industry/banking/solutions/analytics.html