Secure electronic banking, ubiquitous mobile technology, and an overwhelming volume of financial information available in an instant has created a demanding global audience of banking consumers — along with endless opportunities for financial institutions to reshape themselves into lean, customer-centric organizations. But only if they have the banking analytics they need to make truly data-driven decisions.
It might seem like the self-service business intelligence (BI) tools that have entered the marketplace in the last decade could enable this. These tools do create beautiful dashboards that look compelling and give everyone from branch managers to banking executives a snapshot answer to “What is happening?” in their branches, regions, and global markets.
Naturally, it is good to know what’s happening. But these basic BI tools can’t take the next step — the vital step — to answer “Why is it happening?”
Getting past bias and a skills gap to get to the WHY
Figuring out how to give consumers what they want, creating new financial products, and understanding where to go next with your marketing all require discovering new insights within your data, and doing it in new ways. Yet basic BI tools cannot tell you why customers in Europe are moving away from your money market accounts, or what has caused a sharp increase in new account openings in Asia.
Also, just because people in your bank use these analytics tools, it doesn’t mean they know how to use them correctly. Even if they do have those skills, they might still use faulty analytical methods such as attempting to prove causation with correlation, or explaining outcomes with key performance indicators. Then there is the most persistent danger of all: users who look at data through the lens of their own unrecognized bias, which keeps them from seeing what’s really in the data or uncovering game-changing innovations. If you haven’t addressed these issues, you need to ask yourself: is your financial institution hearing what it wants to hear, or what it needs to hear?
A new age of analytics is dawning for banks
So, how can your financial institution make the unbiased decisions that anticipate the desires of the consumer? It takes a new breed of analytics that infuses traditional BI with “smarts,” a lighthearted term for serious technology: augmented intelligence. Augmented intelligence enables data analytics tools that can learn and adapt to individual needs and, more importantly, guide users to new answers and insights while removing from the equation the human bias that can cloud thinking and prevent real discovery.
The result? Banking analytics that goes far beyond descriptive dashboard reporting and puts advanced analytics, smart data discovery, natural language queries, and sophisticated data storytelling capabilities in the hands of every data-driven professional in your organization. Everyone works more efficiently and effectively, and your bank is better able to meet the needs of the markets and, most importantly, customers.
To better understand how this works, take a look at our interactive SmartPaper, “The next wave of business intelligence.” Meanwhile, imagine using patterns in your data to identify clients with a high probability of accepting marketing offers and then adjusting your campaigns accordingly. When a South American bank used smart analytics to do just that, it saw revenue from retail customers increase by close to 60 percent. Or consider the example of the Polish bank that uses smart analytics to provide personalized loan offers even while automating its loan-approval process.
Cognos Analytics brings you stronger banking analytics
The modern, AI-driven solution delivering these results is IBM Cognos Analytics. This flagship BI software has been completely reconceived to include machine learning, automated pattern detection, intelligent and interactive dashboards, and simple, reusable, drag-and-drop reporting. Here’s an example drawn from the retail industry:
Beautiful visualizations will show you how your marketing efforts are translating into sales, but also help you understand previously hidden relationships in the data that lead to breakthrough insights.
Most importantly, Cognos Analytics takes your data and turns it into insights that everyone — from tellers to regional managers to the C-suite — can trust and act on with confidence.
To see for yourself what Cognos Analytics can do for your financial services organization, register now for your free trial.