Business intelligence (BI) is capable of unlocking the full potential of a company and its services, especially those in the finance industry. With access to real-time data, employees and managers alike, can make more reliable, effective and quicker decisions. Read on to learn how BI tools are being used to revolutionize the finance industry.
What is Business Intelligence?
Business Intelligence combines a wide range of strategies and processes for collecting, cleaning, formatting, and analysing data. By analysing historical as well as real-time data, companies can derive actionable insights that help improve the decision-making process. BI can help you understand your customers and business operations to increase revenue.
The finance industry has leveraged BI for quite some time now. However, only recently has the real potential and value of data become relevant and mission-critical to their operations. Needless to say, the need for dependable BI tools has become a key demand of the finance industry. These tools allow for companies to analyse the large volumes of data being generated every day, in order to gain actionable insights. Furthermore, BI can be used to consolidate data from different applications to create a single source of truth.
An effective BI strategy can also help companies in this industry improve their data quality and the reliability of their decision making throughout the organisation. Creating a set number of dashboards and reports, which are automatically updated daily or in real-time, which are standardized and certified by the internal data team, further mitigates the risks of managers taking decisions based on inaccurate or outdated data. In 2022, it’s no secret that those organisations that do not invest in improving their data quality, literacy, and infrastructure are vulnerable to added risks, costs, and lost market share.
How can BI be used in the finance industry?
Finance companies like banks, insurance agencies, credit card companies, etc., need to increase their market share, add new customers, and do so much more in order to stay competitive in what is fast becoming a disrupted industry thanks to fintech start-ups popping up all over the world. An investment in BI can help industry veterans bridge the gap and give the crucial insights needed to achieve their goals.
In recent years, BI has also become cheaper to implement and a lot more cost-effective to maintain, thanks to the rise of flexible SaaS (Cloud-based) offerings that are automatically updated, maintain their own security, and can be literally deployed within minutes.
Here are a few ways companies in the finance industry can leverage BI:
Data Management
Accessing and managing data effectively in today’s world is no longer as complicated as it once was, however, it is a problem that continues to ail businesses, especially in the finance industry, which are collecting large volumes of data and are unable to make any sense of it. Many of the world’s leading BI tools now come with their own basic data management features, which can help finance companies solve this problem. From gathering customer information such as requests, complaints, and suggestions from customer care systems; to collecting data on allotted resources for providing customer service, BI can centralize data from multiple systems. By combining that data and analysing it in a visual manner, companies can discover commonalities and insights that vastly improve the efficiency of their operations, while giving them a competitive edge in the market.
Customer retention
With the help of BI tools, attracting new customers and retaining old ones can become a lot easier, especially when combining data from various departments such as customer care, marketing, and sales. Finance companies are able to qualify prospects and leads more efficiently, while also shortening their sales funnel. Moreover, when analysing data around the income and spending patterns of their customers, they can create more effective upselling and cross-selling opportunities for their sales teams. This further increases customer value, while improving customer retention.
Risk management
All finance companies deal with large sums of money. This is a volatile market and without the right information, it’s hard to set effective policies to manage risk efficiently and sustainably in the long term. BI can help companies analyse their historical and real-time data to help them devise better strategies to tackle this critical part of their operation. Data visualization reports can be used to provide reliable and accurate information about internal audits, data security, risk management KPIs, to name a few; in a way that can be easily understood by both technical and non-technical professionals alike. Furthermore, companies can train employees on how best to use such reports to better handle the demands of the customers and mitigate risks.
Real-time reports
BI tools can help finance companies get information on the brand’s performance, assets and liabilities, the status of the customer credit pipeline, and more. All the reports can be in automated in real-time, meaning that they include the latest information. Companies can also use these reports to optimize their information management system and improve collaboration among departments. As the age-old saying goes, “time is money”, and the quicker one has access to the latest data, the faster and more reliable the decisions that are made.
Advanced technologies like Business Intelligence, along with new elements of Data Science such as, AI & Machine Learning, have already transformed the finance industry. Going forward, more and more companies will be implementing such solutions to improve productivity, operational efficiency, and risk management, which will position them to enjoy sustainable growth in the future.
