Financial services: Data silos and legacy systems are preventing data insights

“Unconnected and incompatible IT systems create data silos and prevent (valuable) data and insights from being discovered,” claims Claranet, following research.

Listen to Jeff Bezos, and one imperative shines out: understand the customer. Amazon does this via data, and making optimal use of it.

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It seems financial services firms could do with following the Bezos lead. According to research from Claranet, among IT and Digital decision-makers, more than half (or 54% to be precise) of UK financial services organisations struggle to draw valuable insights from data that they collect. As a result they struggle to make vital business decisions.

The research also found that:

• 43% of UK organisations in the financial sector cite centralising customer data as being a key challenge encountered when trying to improve the digital user experience
• 41% reported that they were unable to provide a consistent experience across channels as a result.

The research was conducted by Vanson Bourne and surveyed 750 IT and Digital decision-makers from a range of organisations across Europe.

John Hayes-Warren, who is Head of Vertical Markets at Claranet UK said that “an often-siloed and legacy approaches to data management is a major barrier.” He added “that as a result businesses in the financial sector are prevented from exploiting the potential of the information at their fingertips”.

>Read more on How technology is impacting the finance and banking sector

Hayes-Warren contrasted this poor understanding of data with its potential value. “Most businesses are sitting on vast amounts of data and those that can harness it effectively can gain a much deeper understanding of their customers, better predict, improve and personalise the customer experience and, ultimately, create stronger brand loyalty and repeat business,” he said.

“So addressing data management shortcomings needs to be a priority for any business that is passionate about delivering a positive customer experience.”

The cloud can help

As for a possible fix. Hayes-Warren counselled: “To realise the benefits of data you’ve got to be able to combine and mine different repositories of data and make it actionable in real time. However, that’s something that is often frustrated by legacy systems and batch processing. These unconnected and incompatible IT systems create data silos and prevent data and insights from being discovered and actioned within organisations.”

“Cloud technologies can help a great deal, providing the tooling and infrastructure needed to collect, process, and analyse vast sets of data from across the organisation and make it actionable in real time. By creating a platform that can capture and analyse data from across an organisation, leaders can discover unique insights, issues and opportunities that will ultimately help them achieve the competitive advantage they seek.”

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Michael Baxter

.Michael Baxter is a tech, economic and investment journalist. He has written four books, including iDisrupted and Living in the age of the jerk. He is the editor of and the host of the ESG...