Decentralised data and processes are commonplace in financial services and banking (FS&B) businesses, according to research from AI for analytics platform, Alteryx, leaving organisations unable to unlock their true potential from data.
Data Stack Evolution: Legacy Challenges and AI Innovation, a global report which included a survey of 775 FS&B IT decision-makers, found that almost three in five firms (57%) said their data leadership and IT teams work in silo. Almost a fifth (16%) admitted that there is no collaboration between these teams whatsoever, blocking the sharing of data and knowledge to achieve new data analytics use cases.
The findings will come as a concern for the sector given that data sharing is critical to ongoing efforts to harness AI and Machine Learning algorithms to solve problems and remove friction from customer-facing processes using structured and, increasingly, unstructured data.
The report revealed that this lack of cohesion between data and IT teams is having a knock-on effect on how other lines of business work with data. Many FS&B IT leaders indicate that data is kept within the department it was generated by (47%) and that each company department is responsible for managing its data (39%).
Part of the problem is that there is little consensus on where the responsibility for data processes lies. For example, the report uncovered an almost 50/50 split amongst respondents about whether data quality management should sit within the IT team’s remit (48%) or the data leadership team’s (49%). Similarly, 47% of FS&B IT leaders see managing and processing large datasets and databases as a data leadership task, while 46% say it is the responsibility of IT teams.
This lack of ownership also translates into a lack of data culture. Just a quarter (25%) of IT decision-makers in FS&B companies said they are prioritising data consistency across sources to ensure high-quality, value-adding data. Further, governance policies and strategies that cover the distribution of data are only in place in 20% of firms, pointing to a lack of data democratisation.
Alan Jacobson, Chief Data and Analytics Office at Alteryx, said: “The full potential of data analytics in financial services cannot be unlocked without a centralised strategy and chain of command. Businesses that are still relying on fragmented operations and reactive analytics on an IT project basis risk getting left in their competitors’ dust as the opportunity to drive real transformation is simply not there. Aligning data science with overall strategic corporate direction and embedding a data culture across the organisation, enables multi-domain problem-solving through shared datasets and insights. With this approach, organisations can reach the analytics maturity needed to unlock new use cases that drive innovation.”
To learn more about Data Stack Evolution: Legacy Challenges and AI Innovation, download the full report from Alteryx.
