The world is flush with news around the concept of big data – the influx of data from the Internet, mobile devices, social media and other sources that contains a gold mine of information for companies that are poised to find it.
Consider a new report from Capgemini that reveals that nine out of 10 business leaders believe data is now the fourth factor of production, as fundamental to business as land, labor and capital.
The use of big data has improved the performance of businesses on average by 26% and that impact will grow to 41% over the next three years, according to Capgemini’s study of 600 C-level and senior executives.
Two-thirds of the executives note in the study that they consider their organizations to be “data-driven,” meaning that data collection and analysis underpin their firms’ business strategies and day-to-day decision making. More than half of the respondents say management decisions that are based purely on intuition or experience are increasingly regarded as suspect. And 65% assert that more management decisions are based on “hard analytic information.” That figure rises to 73% for the financial services sector.
Indeed, financial services firms that use business analytics efficiently and effectively will thrive in the current uncertain and fluctuating markets, while those that do not are likely to flounder, according to a blog post from SunGard and IDC.
SunGard has identified 10 trends shaping big data initiatives across all segments of the financial services industry in 2012:
- Companies require larger market data sets and deeper granularity to feed predictive models, forecasts and trading throughout the day.
- New regulatory and compliance requirements are placing greater emphasis on governance and risk reporting, driving the need for deeper and more transparent analyses across global organizations.
- Financial institutions are ramping up their enterprise risk management frameworks to help improve enterprise transparency, auditability and executive oversight of risk.
- Financial services companies are looking to leverage large amounts of consumer data across multiple service delivery channels to uncover consumer behavior patterns and increase conversion rates.
- Emerging markets like Brazil, China and India are outpacing Europe and America as significant investments are made in local and cloud-based data infrastructures.
- Advances in big data technology will help financial services firms unlock the value of data in operations to help reduce costs and discover new revenue opportunities.
- Traditional data warehouse systems will need to be re-engineered with big data technologies to handle growing volumes of information.
- Predictive credit risk models that tap into large amounts of payment data are being adopted in consumer and commercial collections practices to help prioritize collections activities.
- Mobile applications, tablets and smartphones are creating greater pressure for company networks to consume, index and integrate structured and unstructured data from a variety of sources.
- Big data initiatives are driving increased demand for algorithms to process data, and emphasizing challenges around data security and access control as well as minimizing impact on existing systems.
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