Struggling to Become Truly Data-Driven? Focus on Access and Culture, Not Tech
Banks and credit unions are swimming in data. So why do so many institutions struggle to get the right data to the right people at the right time to drive the right decisions? A new report suggests solutions that (surprise) do not rely on more technology.
By David Evans, Chief Content Officer at The Financial Brand
The report: Level Up Your Data Strategy
Source: Marquis
Why we picked this report: The financial industry is a couple of decades into what was supposed to be a data-driven renaissance. But many institutions still struggle to drive value from their investments in data technology. What are we missing?
Executive Summary
Financial institutions today face unprecedented challenges in leveraging their data assets effectively, with 80% citing data accessibility as a significant hurdle. How can banks and credit unions transform their data strategy without requiring massive technological overhauls? The report emphasizes four critical areas: establishing a solid data foundation through systematic auditing, improving data access and ownership across departments, building stronger reporting and visualization capabilities, and fostering data-driven leadership.
The playbook advocates for a balanced approach combining practical tools, employee training, and cultural transformation to create a data-driven organization. By implementing these strategies, financial institutions can enhance decision-making, improve operational efficiency, and deliver more personalized customer experiences.
Key Takeaways
- A well-structured data strategy must prioritize practical, achievable steps over ambitious technological moonshots, focusing on immediate implementation rather than long-term overhauls.
- Cross-departmental collaboration and standardized data practices are essential, as 70% of data initiatives fail due to siloed information and lack of visibility
- Financial institutions need to balance automation and human expertise, with targeted training programs and clear ownership structures being critical success factors.
- Regular assessment and optimization of reporting processes can significantly improve efficiency, as 30-40% of current reports provide minimal value.
What we like about this report: It advocates effectively for the fundamental, often unsexy work in data governance and access that is nonetheless critical to actually becoming data-driven.
What we didn’t: Some of the report’s recommendations are high-level and vague.
Building a Strong Data Foundation
The journey toward effective data utilization begins with understanding an institution’s current position and relationships with data. Many financial institutions take their existing foundation for granted, assuming that traditional banking skills naturally translate to data literacy. However, transforming into a truly data-driven organization requires a different set of competencies and a fresh perspective on existing capabilities.
A systematic audit of data sources, access points, and usage patterns reveals that most institutions’ data originates from their core systems but flows through multiple channels including online banking platforms, CRM tools, and loan origination systems. Understanding these data pathways is crucial for identifying bottlenecks and opportunities for improvement. This audit process should be thorough and systematic, involving stakeholders from across the organization to ensure all data touchpoints are identified and evaluated.
The foundation-building phase must also include a careful assessment of data quality and consistency. Many institutions struggle with duplicate records, inconsistent formatting, and outdated information that undermines their ability to derive meaningful insights. Establishing clear data governance protocols and quality control measures at this stage can prevent costly errors and inefficiencies down the line.
Improving Access and Ownership
Data accessibility remains a persistent challenge in the banking sector, with almost half of all employees reporting limited access to the information they need for decision-making. This limitation often stems from outdated policies, compliance concerns, or internal political barriers. The solution involves creating clear protocols for data access while maintaining security and compliance standards.
The report emphasizes the importance of standardizing data storage and naming conventions. Poor organization and inconsistent formatting can make data difficult to locate and analyze, leading to inefficiencies and duplicate efforts. Implementing clear naming conventions and centralized storage solutions can significantly improve data accessibility and usage. For example, adopting standardized file naming conventions like "ProductType_MetricName_Date" can dramatically improve searchability and organization.
Beyond technical access, institutions must address the cultural aspects of data ownership. This includes establishing clear responsibilities for data stewardship, defining processes for data updates and maintenance, and creating accountability mechanisms to ensure data quality remains high over time. Successful organizations often implement a hub-and-spoke model where centralized data governance teams work with departmental data owners to maintain standards while allowing for necessary flexibility.
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Strengthening Reporting and Visualization
A recurring theme among financial institutions is data overload combined with insufficient relevant insights. The playbook advocates for tailored reports and visualizations to support strategic priorities while simplifying the user experience. This involves establishing appropriate reporting cadences – daily for actionable insights, monthly or quarterly for strategic analysis, and infrequent for compliance or audit purposes.
The report stresses the importance of meaningful visualizations that enhance understanding rather than complicate it. Many report users are not data scientists, and their needs must be considered when designing data presentations. Simple, clear visualizations that highlight key metrics and trends prove more effective than complex, data-heavy reports. The key is to focus on the story the data tells rather than displaying every available metric.
Effective visualization strategies should align with specific user needs and consumption patterns. For instance, executive dashboards might focus on high-level KPIs with drill-down capabilities, while operational reports might emphasize detailed metrics with clear action triggers. The report recommends regular user feedback sessions to ensure visualizations remain relevant and valuable over time.
Leadership and Cultural Transformation
Success in data strategy requires strong leadership commitment and cultural transformation. The playbook emphasizes the role of leaders in advancing data literacy and encouraging data-driven decision-making. This includes identifying and empowering "data champions" across the organization and creating communities of practice to share knowledge and best practices.
Training and development play crucial roles in building data capabilities. The report recommends targeted training programs for employees central to data usage, utilizing both online and in-person resources. Investment in training yields significant returns through improved efficiency, better decision-making, and enhanced customer service. However, training should not be a one-size-fits-all approach; it should be tailored to different roles and skill levels within the organization.
The report emphasizes that becoming a data-driven organization is an ongoing journey rather than a destination. Financial institutions must continuously evolve their data strategies to keep pace with changing technology and customer expectations. This includes exploring emerging technologies like artificial intelligence and machine learning, while ensuring they maintain a strong foundation in data quality and governance.
Successful institutions are increasingly focusing on predictive analytics and forward-looking insights rather than just historical reporting. This shift requires not only technical capabilities but also a cultural change in how data is viewed and used throughout the organization. Leaders must foster an environment where data-driven decision-making becomes the norm rather than the exception.
The Role of Technology and Tools
While the report emphasizes that technology alone is not the answer, it acknowledges the important role of appropriate tools and systems. Financial institutions should evaluate their technology stack to ensure it supports their data strategy goals while remaining cost-effective and manageable. This might include investments in data integration tools, visualization platforms, or analytics software, but always with a clear focus on business outcomes rather than technology for its own sake.
Integration with existing systems is crucial, as many institutions struggle with legacy technologies that don’t easily share data. The report recommends a phased approach to technology adoption, focusing first on addressing critical gaps and pain points before moving on to more advanced capabilities. This ensures that investments in technology directly support the institution’s strategic objectives while maintaining operational stability.
Editor’s note: This article was prepared with AI language software and edited for clarity and accuracy by The Financial Brand editorial team.
