Financial services firms have traditionally been known as pioneers when it comes to business intelligence, paving the way for new and exciting uses of reporting and analysis tools. BI has helped many of the leading banks, brokerage firms, and insurance companies to improve operational efficiency, boost revenues, and gain a competitive advantage.
There are a variety of ways that BI can be successfully applied in financial services scenarios to deliver value, including:
A complete view of the customer
Mergers and acquisitions are rampant throughout the financial services industry, thanks to heavy deregulation over the past decade. Companies that once competed aggressively against each other are now all joining forces to form larger, full-service financial conglomerates.
But, until these “mega-companies” fully integrate their disparate environments – initiatives that could potentially take years to complete – business intelligence can provide the most effective way for these firms to combine data from various heterogeneous systems, and empower employees with a single, timely, and fully accurate view of the customer. This is particularly important when it comes to service and support activities, where representatives need to have a complete understanding of client activities across all lines of business.
Increased sales and revenue opportunities
Consolidation has lead to increased product diversification, presenting greater opportunities to improve customer value by selling additional products and services.
Business intelligence can help facilitate more successful up-sell and cross-sell initiatives by aggregating and presenting data from siloed CRM and sales force automation systems across multiple platforms, giving sales reps insight into what products and services each client already has, and which ones they may be interested in.
Risk management
Financial services firms face greater risks than companies in other industries. Data breaches, transaction fraud, poor lending decisions, and other threats must be avoided at all costs in order for companies to maintain profitability, protect their reputations, and avoid stiff fines and penalties. Some of the more advanced business intelligence solutions can be effectively applied to enhance all facets of risk management. For example, predictive analytics can be employed for use in credit scoring applications, while a combination of data mining and real-time alert systems can be utilized for fraud detection purposes.
Performance measurement
As financial entities grow larger, it becomes increasingly difficult to effectively measure and manage performance across all offices and lines of business. Yet, in order to optimize core operations and facilitate sustained business growth, they need to monitor the metrics that matter most. Which products are selling well and which ones aren’t? Which branch offices are on target to meet their sales quotas and which ones are underperforming? Which customers are the most and least profitable? What are average client churn rates? BI systems provide this kind of insight, even across multiple technology environments that have yet to be fully integrated.