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Effective Data Management: “The Final Frontier” - Capco survey reveals a surprising lack of effective data management in financial services institutions

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Caroline Beer, +44(0)20 3100 3796, caroline.beer@metia.com
Laura Paterson. +44(0)20 3100 3507, Laura.paterson@metia.com
Data is still a misunderstood and under-leveraged corporate asset. Nearly a quarter of financial services institutions do not understand the positive impact of potential effective data management on P&L.

Capco, a global business and technology consultancy dedicated solely to the financial services industry, has published the results of its recent survey into data management practices and perspectives among European financial institutions. The paper “Data, Still the Unknown Unknown” highlights a story of inconsistencies and lost opportunities – the impacts of a data management situation that is not sustainable. The survey questioned European financial executives on five key aspects of their current data approach: Data Management; Data Ownership; Data Costs; Data Quality; Unstructured Data. Key findings include:

  • Awareness of data policies is low among financial institutions
  • Nearly a quarter of respondents do not understand the impact of data management on a company’s P&L
  • 42% manage customer data as a regulatory compliance issue without considering its revenue potential
  • 80% have not yet fully explored the use of social media data, nor do they fully understand its value

Of the results, Maurizio Bradlaw, Capco Partner said, “Financial services organisations need now to take action. Over the last two years changes in the financial industry have been substantial: spiralling costs, multiple regulations, consumer expectations and development of new, data-rich media add pressure. Effective data management can no longer be misunderstood, still less ignored.”

The Capco survey confirms that the ways data is managed vary substantially from one institution to another. Even more significantly, approaches change within the same organisation. And there is even variation in how senior managers actually view the data itself: its asset value is often either unrealised or ignored.

The issue must be addressed. But restating the problem is not in itself an answer. Capco believes the financial services industry needs a constructive, cross-organisational and practical approach to effective data management. Such an approach needs to be consistent and must accommodate changing market and operational conditions. It should be supported by the most appropriate technologies and systems and driven by a common ‘data culture’.

Bernd Richter, Capco Partner added, “The future success of financial institutions will partly be governed by their ability to deliver a good data management structure. Looking ahead, strong and clear goals can be set in order to improve control and efficiency and enable the growth of measurable data value and competitive advantage. The challenges here are significant, but so are the opportunities.”

The five fundamentals that demand effective data management are:

  1. Regulatory compliance - achieving it on the most sustainable, future-proofed and cost-effective basis.
  2. Risk management – increasing its effectiveness through clean and current data access.
  3. Revenue increase – driving it up with cross- and up-selling opportunities identified by deep customer data understanding.
  4. Innovation – using customer-data-derived insights to increase client intimacy and inform product and service portfolio development, drive market impact, customer retention and competitive advantage.
  5. Cost reduction through efficiencies, reduction in errors and re-working and unnecessary task duplication.

In Capco’s view – based on extensive client work in Europe – successful financial institutions will migrate from being obliged to ‘do’ data management to become true Data Management Organisations.

Download the Capco report on Data Management
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About Capco
Capco, a global business and technology consultancy dedicated solely to the financial services industry. Our professionals combine innovative thinking with our unrivalled first-hand industry knowledge to offer our clients consulting expertise, complex technology and package integration, and managed services to move their organisations forward.

Through our collaborative and efficient approach, we provide our clients with tools to enable them to increase revenue, better manage risk and regulatory change, reduce costs and enhance control. We specialise in banking; capital markets; wealth and investment management; finance, risk & compliance; and technology. We serve our clients from offices in leading financial centres across North America, Europe, Asia and Africa. To learn more, visit our web site at capco.com and subscribe to Capco's newsroom RSS feed.