Although technologies such as warehouses and document management tools have made it relatively easy for banks to gather and store data, the result often has been the perpetuation of siloed information - thus preventing organizations from gaining any strategic benefits from that information. Today, there is growing recognition that to compete successfully in such critical areas as customer retention and cross-selling, those siloes of information must be integrated across the entire enterprise to create true business intelligence. To accomplish this, banks of all sizes increasingly are turning to an array of tools such as analytics, modeling and forecasting systems - often in the form of a packaged BI solution. These kinds of tools enable banks to develop a complete and dynamic analysis of all their customers, for example, or to parse and interpret the various financial and risk-related transactions that must be reported as part of an ongoing compliance effort. In fact, it is in the areas of CRM and regulatory compliance that BI tools are generating the biggest payoffs.
"Strategic enterprisewide implementation of business intelligence is needed to achieve compliance," says Michael Azoff, senior research analyst, The Butler Group (Hull, U.K.). In addition, he says, integrating BI technologies within the entire organization will give banks a step ahead in regard to innovation and competition. "It is essential to have business intelligence implemented at the top level and enterprisewide. Different departments having created their own business intelligence solutions doesn't work," Azoff explains.
In order for banks to integrate BI tools successfully, they must understand the challenges of implementing an enterprisewide tool. "Having good integration between BI and other tools is an important aspect," says Azoff. "A need for cultural acceptance of BI within the organization and making good use of it is also important."
The technical challenges of implementing an enterprisewide business intelligence solution begin with the gathering of data from all of the disparate sources within the organization. The need for metadata management plays a role in the integration of BI tools, according to Azoff. "Having BI tools that address metadata is important for integrating with other tools," he explains. "Going on to OLAP [online analytical processing] and having good tools that allow most power users to delve into the data in a rapid and easy way can provide other users within the organization with the reports."
In the past, banks typically relied on spreadsheets that resided in silos within each department. This approach to handling data decreased banks' ability to understand the data as a whole and benefit from it, according to Azoff.