In today’s quickly evolving and highly competitive banking industry, one thing’s for certain: the financial institutions that have made the effort to future-proof their businesses have the best chances of succeeding. But what does “future-proofing” entail, and what practical steps can a financial institution take to guide its business into a prosperous future?
Part of the answer may lie in shifting towards data-driven decision-making and policy implementation. By anchoring its business culture on a data-driven mindset, a bank can do more than simply increase its profitability in the next few years. It can build enough agility and resilience to cement its position as a power player of the financial industry in the future.
Knowing that, it may be time to set aside legacy banking systems that no longer serve your interests and start building a solid technological foundation based on effective data management. Below are five steps that you can take to nurture a data-driven business culture and to strengthen your organization for the years to come.
Invest in a Data Management Platform
One of the most valuable things you can do for your bank’s future is to invest in better data management technologies. Now may be the best time to upgrade your data management infrastructure and employ a platform that includes financial services analytics tools and other innovative features.
Having your own platform will allow your organization’s leaders to have a 360-degree view as well as full control over your banking data. That will save you the trouble of having to entrust your data to outside sources, increase your organization’s savings on tech-related costs, and leave you better equipped to make granular-level decisions on your forthcoming banking operations.
Get on Top of Your Data Stream
As banks grow their product lines and accommodate a larger base of corporate and retail customers, they’ll be met with the challenge of managing huge and complex streams of data. A bank without a data-driven business culture will regard this influx as a disadvantage or an inconvenience to be dealt with, rather than a boon that can be taken advantage of.
If you and your team are proactive about patching up holes, removing data silos, and streamlining new banking data that comes from a variety of sources—from your physical counters to your banking app—you’ll have done enough to ensure a competitive future for your organization.
Focus on Data Integration
Another priority that your bank should take into account when revamping its business culture is data integration. The best data management approach involves operating from a single source of truth, or a consolidated data repository that’s updated in real time. In addition to keeping a single source of truth, your bank should work towards achieving reliable data integration from within your internal system as well as external sources like third-party application programming interfaces (APIs).
It may take some time for your bank to adopt a uniform standard of information from the various data sources that it’s required to handle. But once this is achieved, you’ll be able to harness richer and fuller insights about the preferences of your banking customers. This, in turn, will give your organization the edge in the long haul.
Improve Your Data Quality
On top of finding a system to streamline, organize, and analyze your data, you’ll also want to pursue a mechanism for improving your data quality. Good business intelligence relies on accurate, usable, and up-to-date data. Whether they pertain to your profitability management or customer enrollment, you’ll want to make sure that your numbers are not erroneous or obsolete.
Take the time to look at technological solutions that can help you improve the quality of your banking data. Supplement any upgrade that you make with new staff protocols for observing a consistent standard for data quality management.
Strengthen Banking Functions Related to Data Management
Lastly, if you want your new data management approaches to work—and if you want the changes to be permanent within your business culture—you also have to strengthen the other banking functions that are related to it. Better data management alone cannot guarantee a lasting culture of data-drivenness within a financial institution. It must be supported by better systems for customer enrollment, customer due diligence, and regulatory reporting among others.
Think of your data management strategy as part of a holistic plan to future-proof your bank. Even as you work to become more data-driven, don’t ignore the other aspects of your banking operations. On the contrary, try to examine how a data-driven mindset can trickle down to other banking functions and achieve synergy across your organization’s banking departments.
In the end, future-proofing your banking enterprise boils down to innovating your old systems and becoming agile enough to navigate an ever-changing business and regulatory environment. You can start by changing your data management systems and practices, then bolstering your business culture to support these big changes. Doing so may ensure your longevity in the financial industry and increase your chances of becoming the top banking brand for multiple generations of customers.