EVOLUTION OF BANKING

BIG DATA TO ACTIONABLE INSIGHT
Consumers are no longer satisfied with one-size-fits all service delivery. The
emergence of ‘big data’ will allow providers to switch to a customer-centric philosophy
by identifying the differing needs of individual customers. Banks and other financial
service providers will have enough information to tailor products and services to very
specific segments.
To explore ways to better harness data, providing more precise, customised and
quality solutions
Almost everything that happens in the developed world is tracked by computers these days. Banks
are not the only entities that record very detailed information about how, what, where and when their
customers buy from them, how well their staff perform, how their supply chain works, what products
make and lose money, which marketing offers and channels work best on different days of the week,
and so on. Everything that happens in the entity, no matter how trivial, gets recorded somewhere on
a computer.
All of this tracking, monitoring and measuring creates a vast ocean of information, called ‘Big Data’.
Facilitates
cost
reduction
Enables
targeted customer
marketing and
“flight to quality”
Supports drive
towards customer
centric products,
services and
processes
Most of the big data in the world doesn’t even come from tracking human behaviour in this way; it’s
‘machine generated’. Think about smart-meters used to monitor your energy or water consumption
sending data to the utility provider’s computers, or all of the ATM machines in a branch network
reporting their performance data to a central computer. There are thousands of different situations
in which machines generate and record data about their activities. Because we now have so much
data about the many different ways the world around us works, we can analyse that data to look for
interesting patterns. Financial service providers can find hidden patterns which will help them spot
opportunities to save money or sell more; the data might reveal previously unnoticed patterns in the
way people buy certain products, or inefficiencies in the way the rest of the business operates. Big data
can mean big money. Banks and others are investing a lot in the technology and skills required to store
and analyse their ever-increasing data sets, to discover the potentially valuable hidden patterns. But it’s
not easy. Big data requires high end hardware and software, so you need people who have the skills to
manage that side of things, but you also need people who understand how to properly analyse it all, and
these ‘data scientists’ are in high demand.
34 | The Evolution of Banking and Financial Services