Taking your Data from Big to Useful - Blog Series Week 9
George Orwell would be surprised to see his vision of 1984 taking place today. What used to be referred to as ‘Big Brother’ is now a reality with tracking of everyone’s movements. Today of course, we don’t refer to it as Big Brother; Big Data sounds a little friendlier.
“Big Data” are two words that have come together to say exactly what we have, the vast amount of data that a financial institution creates on a minute by minute basis. It is no secret that banks have big data; the real question is how to make this data useful or, for an even simpler start, how to acquire this data and bring it into a useable scenario.
The problem is that data is currently scattered all over the place. This is not even referring to the data kept in the main IT processing systems, as that should be fairly easy to consolidate. The real data we want to access, is often held in huge customer service and peripheral processing systems. This is the specialist data about customer behaviour, such as what they do differently each day and more importantly, what the data can tell us about predicting future behaviour.
Banks are trying to harness the data held within their systems, because as they say, knowledge is power. But it needs to be more than just collating the data into one place; the real power lies in understanding what all the data means and how to leverage it to create the products that our customers want to buy from us in the future.
I previously spoke about Basel III, and how visibility of liquidity positions can help the bank be stronger. That's true, Big Payments Data, as I referred to it, can help define the products that will be in demand from our customers before they even know they need them. This is innovative too, as the ability to offer the products that customers need is often the simplest form of innovation.
With the advance of real-time payments, customers are going to expect and require more data. It's not good enough to simply provide an overnight posting update to customers; they expect real-time status and real-time interaction. They have a liquidity position to keep too. And because that gives them knowledge (and therefore power), they are prepared to pay for it.
Consolidating all the data is great, but we need to really understand what it means and how to leverage it. Use it to create better customer products, use it to reduce risk, use it to improve operations. Turning Big Data into Big Useful Data is what really counts. Now it's time to use it.
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