By ECI | Tuesday, December 20, 2022
When most people hear the word “innovation,” they tend to think about exciting new technologies or services that reinvent a market. But innovation isn’t always about an original idea or new tool. Sometimes, innovation results from a single invaluable resource that your organization has likely been collecting and storing for years.
For financial services organizations, data is that resource. Data can help you develop new applications and services tailored to your clients’ specific needs. And it can help you understand how and where to make improvements to your solutions to drive better engagement of your competition.
Here are four steps to take to maximize your data and use it to power innovation.
1. TAKE OWNERSHIP OF YOUR DATA
Many smaller and mid-size financial services firms are seeking to reduce their dependence on third parties like fund administrators and prime brokers. They want to take ownership of their data, so they can a) dive into their portfolios and investments as needed and b) ensure their data is protected.
It’s a sensible approach. Often, you need to provide information on demand to satisfy regulatory requirements. But it can take time to get that information from a partner. Even then, there’s no guarantee the information is as safe in a third party’s hands as it might be if kept on-premises.
But if you’re going to take your data in-house, you’ll need to organize it and make sure it’s accessible to those who need it. Otherwise, you’ll end up with raw data from potentially hundreds of sources, but with no way to turn it into actionable intelligence.
2. CREATE A SINGLE SOURCE OF TRUTH FOR DATA
Financial services firms tend to struggle with managing their data, if only because they handle so much of it. That’s a problem, particularly for an industry where meeting high standards of regulatory compliance and data privacy are so important.
To ensure your data is accurate, up-to-date, and meets regulatory requirements, you’ll need to create a data governance program. This will require looking at all the data within your organization to ensure it’s current, accurate, and categorized correctly. This doesn’t necessarily mean hiring teams of data scientists—that’s a high barrier to reach for any organization these days—but it does mean, at minimum, establishing a “single source of truth” for each of your data categories. This is where all the data collected from all the systems your organization uses lives. A single source of truth serves multiple purposes. First, it eliminates organizational data siloes and provides a single reference point where users can go and know that they’re getting the same information. Second, it allows business leaders to make decisions based on information collected throughout your organization, not just their own business units. That collected knowledge can help drive innovations that can positively impact your entire business.
3. ADOPT A CLOUD INFRASTRUCTURE TO GET THE MOST OUT OF YOUR DATA
The technologies fueling data-driven innovation, such as AI, machine learning, and advanced analytics, require a scalable cloud infrastructure. Without it, you’ll be unable to fully leverage these tools, which require compute capabilities that only the cloud can provide. It’ll also be difficult to effectively access your data. In short, your ability to innovate will be greatly impeded by staying on a traditional, on-premises infrastructure.
Understand, though, that the cloud is not a “deliverable,” something you buy off the shelf once. Migrating to a cloud-based infrastructure requires significant business transformation and consideration. You need to think about how a cloud infrastructure will benefit your business, help you achieve your business goals, leverage all the data you have, and serve as a springboard for innovation.
4. WORK WITH A TRUSTED MANAGED SERVICE PROVIDER
These are often difficult points for internal teams to consider, for several reasons. Most simply do not have the time or expertise on staff to handle such an undertaking. Others may be too close to the organization’s everyday operations to take a step back and provide an honest assessment.
Indeed, migrating to the cloud is almost impossible to do alone, especially if you have a big, unwieldy legacy data infrastructure. The process requires a large amount of specialized knowledge. You need professionals who can help you identify what to migrate and when, and help you develop a strategic and cost-effective approach.
The initial migration is only the first step. After your cloud infrastructure is built, you need people who can maintain it and ensure that it is working for all your line of business managers. That shouldn’t be the responsibility of IT teams, who might already be taxed managing core infrastructure and security. Again, specialists who are equipped to support developers from across your different business groups are a better option.
That’s why it’s important to work with a trusted managed service provider. The right partner will ascertain your business needs, work with you to develop a customized and phased migration plan, and help manage your cloud services post-migration.
At ECI, we work closely with financial services companies like yours to create migration paths that allow them to fully leverage the cloud and everything it has to offer, including the latest AI and data management solutions. We help our clients build the ideal infrastructures to support data-driven innovation.
Learn more about ECI’s managed cloud services and contact us to see how we can help you.
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