This article is a contributed post from Adam DeMattia, Director of Custom Research, Enterprise Strategy Group (ESG).
I recently chatted with Adam DeMattia from leading research and analyst firm ESG in a webinar about data use maturity in financial services. According to the research1, 21% of financial services firms identify as data innovators (compared to 11% of global respondents) — those who make smarter use of data as a matter of strategic importance.
This article kicks off a four-part series as follow up to the webinar, which you can check out on-demand. In this post, I highlight the key findings from the research on data innovators in financial services. Through the rest of the series, we’ll look at data maturity through three key use cases for financial firms.
Here are the top four payoffs data innovators have enjoyed from a smarter use of data. And we’ve got the numbers to prove it:
- Customer delight: 98% met or exceed customer retention targets
- Bullish outlook: 89% believe their organization is in a strong position to compete and succeed
- Improved decision making: 89% make better, faster decisions than the competition
- Profit driven: 6% of gross profit is directly attributable to smarter use of data
Maximizing the economic value of data is no easy feat, so how’d they do it? Firstly, financial data innovators invest in analytics initiatives (both technological and human resources) and democratize them across the organization so that business decisions are truly data driven.
To this end, leadership is equally as important. Data innovators typically have a Chief Data Officer (CDO) to establish a clear data strategy that puts data at the core of decision-making.
Lastly, automation is key. Repetitive tasks or routine analysis are often automated, and employees redeployed to higher value tasks.
In the second half of the webinar, I interviewed a panel of Splunkers about data use maturity in three key use cases for financial services — customer experience, IT operations and fraud —based on their expertise and the work they’ve done with our customers.
The research identified some noteworthy figures about these focus areas that you need to know. What’s more, each expert has authored a post for a deeper dive into the use case:
- 73% are using data to better understand customer behaviors and preferences to optimize CX.
Read: Why Are Financial Services Companies Turning to Data and Analytics to Deliver Improvements in Customer Experience?
- 68% are using data to better and more easily maintain and prove regulatory compliance and 68% have reduced waste in IT Operations.
Read: IT Operations: The Value of Data
- 49% improved fraud detection capabilities.
Read: What’s Your Data Worth in the Fight Against Fraud
Data has always been the great disruptor to the financial services industry. And in a digital world, data is the only true source of competitive differentiation that, when leveraged, contributes to both the top and the bottom lines. So, what’s data really worth to your firm?
1Source: ESG Custom Research, What Is Your Data Really Worth?, March 2020