Over the last 10 years, the financial services industry, much like everything else, has migrated online. Long gone are the days of queuing to arrange a direct debit or cash a cheque, as today it’s all about apps, emails and contactless.
It’s a shift that has of course made our lives easier and transactions faster, but it’s also meant that the amount of data being created by the industry – and the online world in general – is exponentially vast.
Domo’s latest Data Never Sleeps report found that every 60 seconds, the Internet receives more than 3 million Gigabytes of web traffic, 159 million emails are sent and over £2 billion is traded on the stock exchange.
The numbers are huge and we’re already seeing that on a consumer level, our fast-paced ‘information age’ is starting to overwhelm and create major mental health issues for the population. Social media rehab centres have been gaining popularity, and there are now even smartphone recovery programmes for those glued to their screens.
The same arguably applies to the world of business though, and especially the financial sector. Data has always been a hugely important cornerstone for the industry, but it’s now on a completely different scale. Almost every function of a company can now be quantified into databases or analytics, offering businesses a magnifying glass into the habits or demands of their customers and operations.
And making sense of it all is a challenge that most organisations aren’t quite sure they’ve deciphered. In a report into the financial services’ use of Big Data, IQPC found that 46 percent of organisations feel they’re ‘still experimenting’ with it, while only 17 percent have turned Big Data into full production.
It is a big priority though, as market research house SNS Telecom and IT estimated that financial firms will invest $9 (£7) billion into Big Data this year alone. But where’s the starting point when there’s so much to contend with? Have we reached what one Johnson & Johnson exec referred to as Infobesity?
Not quite yet it seems, as digital strategies from the financial giants would suggest otherwise. Paving the way for corporate use of the cloud, HSBC is optimising machine learning to refine activities like anti-money laundering, risk analytics and reporting, along with valuations and financial liquidity assessments. Cutting-edge technology has helped the company mitigate data leaks and misuse of sensitive information.
Then there’s the hefty £3 billion investment into digital transformation from Lloyds Banking Group. To boost consumer transparency, the bank is prioritising its digital presence and putting AI, behavioural and risk models at the forefront and re-platforming its mobile app. The latter is no mean feat thanks to GDPR regulations requiring customer consent for any new databases, but managed well, it will unlock a wealth of opportunity for Lloyds to better understand its target market.
This knowledge and insight is becoming ever more crucial to traditional banking businesses as international retailers threaten their data siloes. Companies like Amazon and Tesco are hot on the heels of financial service organisations, continually adapting depositories for customers wanting to keep their browsing and bank balance in one place.
Of course, these big companies have equally big budgets, but they demonstrate that harnessing the right information and insight is what matters, whatever the size of the organisation. In the increasingly overloaded data landscape, the key is to understand the data points required and prioritise the tools that will bring them to you.
It’s easier than ever to build transparency across the workforce, too. Data visualisation tools can provide granular details of consumer demographics and interests, eliminating the need for time-consuming and often costly surveys or cold-calling for feedback. Instead, teams can integrate and interpret links between sales and performance, creating a far more digestible and understandable business forecast for staff members at all levels.
Data, as we know it, creates access to what is a relatively brave new world. In years gone by the task of noticing data patterns across departments was left to IT, or a specialist with a demonstrated technical history. Now, the leading businesses in any sector understand the true value of data, and make space for data departments and hire CDOs to bolster their competitive advantage.
It’s evolved, as advancements in cybersecurity and business intelligence tools have allowed us to essentially give data its own identity. With the right technologies in place, companies are able to legitimise spending or a culture change through numbers that are tangible. And financial firms can connect the dots between customer habits to generate new business models and services.
That’s why, in today’s business environment, companies harnessing real-time data and artificial intelligence are taking control of the market. Getting it right can be the difference between data security or disorganisation, and over target versus overload.
Ian Tickle is the Senior Vice-President and General Manager for EMEA at Domo