For all of us who have spent a good part of our careers around the long-gathering storm of “big data”, we would be wise to remember the old adage about the difference between “data” and “information”. Data for the sake of data is just data – an often overwhelming series of bits and bytes that can do little to improve (let alone transform) our businesses. When data gets transformed into information, and specifically usable information, it inherently connotes that the bits and bytes have now been organized into insights that can be acted upon for greater customer and corporate benefit.
For credit unions, it is precisely at the crossroads of data and information that we have been prone to “analysis paralysis”, perhaps ironically because of the preponderance of data that has long been literally at our fingertips (before most other industries). The data is there, but we may not know how to turn that into knowledge we can use. With some basic analytics, you may be able to tell that your member has two services with your institution, and to know that she only uses one of these two services on a regular basis, but what tools do you have to make a positive impact on this member going forward? Rather than getting overwhelmed by big data and paralyzed by the thought of all the “information” we can produce, why not focus instead on putting usable information into the hands of business line leadership?!
Information can be leveraged into making a meaningful impact only when it is paired with the right set of tools in the hands of business line leaders to effect positive change and positive outcomes. Consider again the scenario above, but this time the information is delivered to the business line leaders with the proper companion tools to affect change – so that your bankers not only know that your member has two services (one active, one inactive) but also can offer education and personalized incentives to “activate” the second service, and potentially even offer a third helpful service as well. Your member with a lone checking account and inactive debit card can now learn about the incredible utility and flexibility of their debit card to make payments and everyday purchases, get incented for e-statement trial through cash-back offers, and be introduced to your savings account with auto-transfer from checking. Or how about another member who has multiple active services with your credit union and is an active online banker but still is collecting costly, cumbersome paper statements every month — shouldn’t we put this “information” to use by equipping our bankers to offer him tangible education and incentive to try e-statements?
There is a four-step pathway out of the dense forest of big data into the greener pastures of usable information. Too often we have taken just the first step on this pathway, and found ourselves still stuck in the forest. Do some of these questions and frustrations sound familiar?
1st : Access YOUR data to transform it into usable information. It’s all there, but how do I get at it and make sense of it?
2nd : Design and develop new products and programs to educate and reward your members. New products on our existing core system? Not so easy. And what if we don’t get the design right – we may only have one shot at this!
3rd: Effectively launch these products and programs through measurable, targeted marketing. But how do I do this – by running manual promotions out of my desk drawer with duct tape and paper envelopes? There has to be a better way!
4th: Measure and iterate improvements. Great in theory; lousy in execution. Any resources I might have had to do this were long gone somewhere between steps 1-3 above!
Credit unions – even the largest, best-equipped credit unions – can’t tame the beast of big data into usable information on their own. The questions that arise are too numerous, the resource constraints too great, and the shear doubt caused by prior failed attempts too daunting to go it alone. Yet, to simply turn our backs on the data is to wave a white flag in the faces of much larger and better resourced impersonal financial institution “machines” that dot the landscape on the other side of the forest. And to ignore the data is ultimately irresponsible to our members themselves. They are entrusting us with their data. Shouldn’t we be acting upon it to serve them better?
Look to your vendors. Find trusted partners to guide your institution down this pathway. Turn your members’ data into usable information for your bankers. Your members – and your industry – are counting on it.