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Overcoming Analytics Roadblocks

By Will Weidman, Senior Vice President

A recent report reveals that far too many financial institutions are not seeing a significant enough return on their investment in analytics

Analytics have become vital to these organizations’ business success, and for years financial institutions have spent big money on their analytics capabilities – yet many still struggle to maximize the value of their analytics.

Despite significant investment in analytics capabilities, only 18% of global financial institutions – surveyed as part of a Mastercard-sponsored cross-industry report with HBR Analytic Services – described themselves as being highly successful in generating sufficient return on investment in analytics.

Although the need for analytics is well understood, actually making data-driven decisions and realizing business value from analytics remains a challenge. Financial institutions reported using analytics pervasively across their disciplines – with business planning and forecasting, finance, pricing, corporate strategy and executive management being the most common focus areas. But having analytics tools and platforms and seeing a return on investment in them are two different things. When asked where analytics have the greatest impact on their decision-making, the results were not aligned with where investments were being made.


So why is there such a disconnect between where organizations are deploying analytics and where analytics are driving the most impact? A closer look at the responses from financial institutions in our survey highlights three key areas for improvement:

  1. Data quality and access to the necessary data
    47% of respondents highlighted poor data quality as an analytics roadblock and 36% were unable to access the necessary data. Data needs to be democratized in a common, accessible and reliable repository, otherwise it’s unrealistic to expect analytics to be widely and effectively used throughout an organization.

  2. Effective and standard processes to generate analytics
    44% of the respondents reported a lack of effective and standard processes for generating analytics. A consistent approach enables organizations to focus on insights and resulting actions, rather than debating varying methodologies.

  3. Collaboration and clear communication between business and technical staff
    36% of the respondents listed as a challenge the difficulty for business staff to articulate business needs or opportunities for analytics, and similarly 36% of them highlighted the difficulty of technical staff to understand business needs or opportunities for analytics. Unsurprisingly, collaboration between business and technical staff was also cited as a challenge (35%). On the other hand, 80% of the companies across industries that report they are highly successful in driving analytics ROI also reported high collaboration between their business and technical staff. This finding indicates that collaboration among these groups is an essential link in translating analytics into business action and value.

So how can organizations properly address these challenges and unleash the full potential of analytics? The answer is a lot easier than you might think. The adoption or increased integration of analytics platforms and tools, alongside small but significant organizational and cultural shifts within your business, can make a tremendous difference and unlock significant value.

According to the report, one example of a financial institution that has learned to succeed with analytics is Bank of Montreal. By raising the analytics IQ across the whole organization and quantifying the value of its analytics capabilities, Bank of Montreal has overcome many of the challenges plaguing other financial services organizations as they adjust to digital trends. Central to these changes is Bank of Montreal’s test-and-learn process and discipline, which allows them to run in-market business experiments to test ideas with a small number of locations or customer segments to measure impact.

Lori Bieda, who heads the Analytics Centre of Excellence, Personal and Business Bank, says their overall return on analytics investment exceeds 300% year over year. This ROI is made possible by effectively integrating analytics into decision-making. “Insights are the easy part, but you have to take rapid action on them to gain competitive advantage,” Bieda said. That requires getting analytics into the workflows of decision makers and raising the skills and analytics IQ across the business.

To ensure this approach is adopted across the entire organization, Bank of Montreal created an Analytics University with a curriculum targeted at improving the technical, business, and soft skills of analytics professionals and the teams they regularly engage with. By raising skills and deepening understanding of analytics across the board, the bank has become a more analytical, test-and-learn-based organization.

The lesson for financial institutions is that standardized data access and user-friendly platforms are both key to success. Empowering staff to apply data-driven insights and conduct analyses in line with strategy helps inform and improve decision-making processes in real time and unlocks serious value from your analytics. Following these simple steps and ensuring analytics are done right can have a huge return on investment and drive real business value.

Will Weidman

Will Weidman

Senior Vice President, Platform Sales

Will Weidman, senior vice president, is global head of platform sales at Mastercard. He leads a team focused on platform solutions, and is responsible for driving platform sales and developing global sales best practices.

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