Reported by: banking|Updated: April 3, 2015
Murray Sargant, Senior Vice President, Asia Pacific and Japan, Informatica Corporation, speaks about data quality, master data management and the concept of chief data officer in an interaction with Sairaj Iyer of Banking Frontiers:
Most banks are focusing on about 20% of their data for decision making but there is a larger untapped data pool that can be further leveraged to improve the banks’ insights and understanding of their customers’ preferences, buying behaviors and more, feels Murray. Murray Sargant is the Senior Vice President, Asia-Pacific and Japan, of Informatica Corporation that offers enterprise data integration and management software powering analytics for big data and cloud. “This is key in improving customer experience and will expand the wallet share from existing customers when managed right,” he elaborates.
A bank can mine for purchase patterns fromtransaction history. However, finer details like customer experience or their personal sentimentswill not be observable or discoverable from transaction-based data. Atypical shopping experience on Amazon involves asking customers if they want to add a particular commodity to their wish list based on their past purchase record. The bank can also initiate an effective cross-sell or an up-sell offer if it can make use of integrated data analytics to connect to that critical moment of experience with a customer.
Sargant emphasizes that for better selling, banks have to understand the value of data. They should map the 80% of data which includesthe digital footprint and other forms of interaction data to its internal transaction data, and correlate them to derive interesting customer insights. By scientifically mapping data and understanding the significance of those discoveries, the bank can make a quick risk assessment and offer the most appropriate financial product or service to their customers, he says, adding: “But to do so, financial organizations must have quality and reliable data at their disposal.”
POWER OF MDM
Sargant is of the view that Master Data Management (MDM) is the perfect tool to help banks build a customer-centric business, which improves customer acquisition and retention. MDM enables banks to better organizetheir customer data across traditional business silos so that they can understand customers’financial needs, preferences and purchase behavior by having a golden record of their customers in place.
Suppose a business account for a private enterprise, a personal savings account for the owner of the business, an insurance policy for the owner’s wife and a housing loan for their villa are all with the same bank. If the bank has this 360-degree view of the total relationships that this customer has with them and this information can be shared across the enterprise to drive up-sell and cross-sell opportunities, it can proactively offer customized services and products to hold an even larger share of the customer’s wallet. An advantage of this magnitude can bring a lot of worth to the bank in terms of building a longer-term and more sustainable relationship with valued clients, and not to forget, additional revenue.
“Getting your hands on clean data can be difficult as data comes in the raw form from where one needs to be empowered with the right tools to validate, cleanse and profile data in order to make it valuable. Providing good data to the business is crucial to retail and corporate banking, but great data can only happen by design.” says Sargant.
Sargant says Informatica also offers solutions for data privacy management. Their solutions range from data masking products that dynamically mask sensitive production data from unauthorized access,to persistent masking products that permanently and irreversibly mask non-production data used for testing and software development purposes. “There are greater possibilities of a breach or a misuse of data when data-centric security measures are not being implemented. For example, customer service agents in a call center may have access to personal and sensitive data like customer birth dates, PIN, etc. Financial services organizations can consider next-generation data protection solutions to dynamically mask critical information on a customer’s file and reduce their risk exposure. ,” says he.
He cites another example: “Many IT-based projects have to be tested multiple times before being launched. For such projects, if production data are being used for such testing purpose, the risk of data misuse can be very significant to the bank. Our recommendation to clients is to consider tools that automate the provisioning of masked and synthetically generated data to meet the needs of testing, development and quality assurance teams.”
CONCEPT OF CDO
For banks, the emphasis on the quality of data should ideally be driven bythe business and not from technology, says Sargant. IT organizations over a period of time may be short-staffed to manageincreasing data and analytics projects when they also need to take care of infrastructure-related tasks. He therefore encouraged financial services organizations to embrace the concept of hiring a Chief Data Officer and says,“The CDO is a unique individual who thinks strategically about the role that data can play within the enterprise and leverages that knowledge to drive incremental revenue.”
Sargant believes that financial services organizations should move beyond merely building application-level interfaces and focus on data as the core engine for business growth. To do so, a CDO has to ensure that data is duplication-free and can be seamlessly interconnected with other data that resides within as well as outside of the enterprise.
Big data or analytics or for that matter any data-related project, requires getting the right talent to get the job done. Sargant explains, “The CDO is a dynamic job. It needs people with the energy and spirit to understand data. The ideal person is not necessarily the longest-serving employee in an organization. It can even be someone young, under the age of 30 and with agile thinking.”
Murray furthermore hints that some banks he met were keen to hire CDOs and have suggested that Informatica help define the job scope of a CDO. “Yes, we are in the business of helping companies solve their data management challenges and hence we are in a good position to provide the role of an advisory,” he concludes.