In today’s age of digital everything, most community banks have an abundance of data stored. They have data about their customers, like age, marital status, products used, credit reports. And they also have operational data about who uses mobile banking, who pays their bills online, as well as about preferences for text messages versus phone calls, or eStatements versus paper statements.
But are community banks actually getting any value from this raw data? Having stored data doesn’t automatically result in better-informed decisions or more finely tuned marketing strategies. Data must be put to work for it to provide information. Many community banks are still relying on manual processes to collate and report on data from legacy systems. Others still struggle to consolidate data trapped in multiple spreadsheets. Everyone wants a unified view of their organization and their customers, but not everyone knows how to get there.
Investing in a robust business analytics solution is the first step for community banks that want to analyze information, inform and guide strategic decisions, and measure the results. And financial services executives recognize the importance of data-driven decision-making, especially as it relates to customer interactions. In fact, CEB analysts report that 80% of retail banking IT executives believe that creating a single view of the customer is highly or critically important. But all data analytics tools are not created equal, and the selection process can seem complex. Don’t be daunted, though, because evaluating how various stakeholders at your community bank are likely to use business analytics can help you narrow down which solution best meets your needs.
To assist, we’ve had conversations with bank CFOs and other C-suite executives and collected a list of three critical elements they look for in a business analytics solution:
1. The ability to pull data from legacy back office systems
Many CFOs talk about the frustration of trying to extract data from various databases throughout the company and organize it into a meaningful report. We’ve had clients report that thanks to merger activity, they have four or five back office systems, and dozens of auxiliary systems with customer data in them! By the time someone can collate and cross-reference the data into a useful format, the information is obsolete. These decision makers can benefit from an analytics solution with integrations to pull the data from various sources and organize it in a central location. From there, it can easily be pulled to provide meaningful input to inform decisions.
Having a clear – and current – picture of the whole organization, as well as detailed information about relevant aspects, enables decision-making based on data rather than guesswork. Managers and analysts will be able to identify adjustments to operations that are most likely to enhance the organization’s success.
2. Ways to visualize progress toward organizational goals
To enhance communication among departments and make it easier to pinpoint what’s working well and what needs some attention, your analytics software should provide scorecards measuring progress toward organization-wide and department-specific goals. Relevant key performance indicators for a department or branch can be listed, along with the current status, in an easy-to-read format. That way, managers can see a snapshot of key financial and non-financial goals and the progress toward achieving them, as well as any problem areas.
An example might show portfolio growth, loan growth, or average days to resolve a customer concern by branch. Or it might offer an analysis of customers behind on payments, or profitability of customers by demographic segments. Analysis of performance against critical goals will pinpoint opportunities to reduce costs or streamline operations, increasing productivity. And the fewer barriers you put between your managers and their departmental data, the more likely they are to make data-driven decisions instead of just “going with their guts.”
3. Detailed reporting at the touch of a button
The ability to pull reports focusing on different business aspects or areas allows more informed decision-making. Your BA solution needs to be flexible, so analyses can be conducted from a variety of standpoints. If a manager needs to know how many employees are required at a particular branch on a certain day, the platform should be able to show the types and quantities of transactions at that branch on that day of the week.
Or, if a manager wants to know why the digital onboarding channel isn’t meeting its goals, a deeper dive into relevant data could be provided. Make sure your business analytics solution includes a way to share this sensitive data securely as well, so you can encourage sharing while maintaining security. A geographically-dispersed organization like a bank needs all the collaborative tools it can get!
By transforming raw data into meaningful insights and using the information you already have, you’ll be able to deploy resources where they will reap the most benefits. But to get started on the right foot, you’ll want to take the time to understand the needs of the diverse analytics users at your community bank. By developing a comprehensive wish list and reviewing it with your vendors, you’ll be sure to pick the right BA solution for your unique organization.
Want a first-hand peek at a business analytics solution built just for community financial institutions? Book your personalized demo of Doxim Business Analytics now.