Why Data-Driven Decision Making Still Eludes Banks

In an era where data is deemed the new oil, one would expect banks to be at the forefront of data-driven decision-making. However, the reality is quite different. Despite significant investments in data infrastructure and analytics tools, many banks still struggle to harness the full potential of their data. Tellistic Technology Services, a Microsoft Gold Partner in Data and Analytics competency, explores the reasons behind this persistent challenge.

Reliance on IT Departments

One of the primary reasons why data-driven decision-making eludes banks is their heavy reliance on IT departments to pull and query data. In many banks, the process of extracting and preparing data for analysis is still largely manual and dependent on IT personnel. This reliance means that decision-makers often have to wait for data to be fetched, which can be time-consuming and frustrating. By the time the data is available, the window of opportunity for making timely decisions may have passed.

Furthermore, this dependency creates a bottleneck, as IT departments are often stretched thin with multiple priorities. As a result, the data requests from business units may not always receive immediate attention, leading to delays in decision-making processes.

Snapshot Reports and Their Limitations

Another significant challenge is the reliance on snapshot reports, primarily in Excel or PowerPoint presentations. These static reports provide a snapshot of data at a specific point in time but lack the interactivity needed for dynamic decision-making. Once the report is generated, it becomes difficult to make follow-up queries or update the data without going back to the IT or analyst departments. This feedback loop hampers the ability of end-users to fully own the reports and make informed decisions based on real-time data.

Static reports often fail to capture the complete picture, as they do not allow for hypothesis testing or in-depth analysis. Decision-makers are forced to work with what is available, even if it does not address their specific needs or questions. This limitation can lead to suboptimal decisions and missed opportunities.

The Need for Interactive Reports

A good report is one that can be queried and hypothesized over, providing a comprehensive understanding of the data. However, most reports in banks are not interactive, making it challenging to delve deeper into the data and uncover valuable insights. Interactive reports, such as those created with tools like Power BI, allow users to explore the data, ask follow-up questions, and gain a holistic view of the underlying trends and patterns.

Interactive reports empower decision-makers by providing them with the flexibility to analyze the data from different angles and make data-driven decisions confidently. They eliminate the need for constant back-and-forth with IT or analyst departments, streamlining the decision-making process.

Cultural and Organizational Challenges

Beyond technical limitations, there are also cultural and organizational challenges that hinder data-driven decision-making in banks. In many cases, there is a lack of data literacy among business users, making it difficult for them to interpret and utilize the data effectively. Additionally, there may be resistance to change, with some employees clinging to traditional ways of working and decision-making.

To overcome these challenges, banks need to invest in training and upskilling their workforce to build a data-driven culture. They must also encourage collaboration between IT and business units, ensuring that data is accessible, understandable, and actionable for everyone.

Conclusion

Despite the abundance of data and advanced analytics tools, data-driven decision-making still eludes many banks. The reliance on IT departments, the limitations of static reports, and cultural challenges all contribute to this persistent issue. Tellistic Technology Services, a Microsoft Gold Partner, emphasizes the importance of interactive reports and a data-driven culture to overcome these hurdles. By leveraging tools like Power BI and fostering collaboration, banks can unlock the full potential of their data and make informed decisions that drive growth and profitability.