This article will focus on the Cloud-Based Enterprise Reporting for Banks.
BNKBenchmarkDashboardWhat is Enterprise Reporting?  In the past, Business Intelligence (BI) was limited to the office of Finance and typically with a key focus on Financial, Planning & Analysis (FP&A).  With the advent of Enterprise Reporting, BI is now being extending beyond the scope of IT staff, business analysts, and power users.  Enterprise reporting is enabling anyone who impacts the bank – city executives, branch managers, loan & deposit analysts, and customer-facing staff – to have immediate access to the vital information they need to most productively perform their jobs.

Access to data and other information is growing dramatically, driven by multiple factors, including the uptake of social computing and cloud computing and increased usage of database appliances and easy-to-use data analytics solutions.  Bank IT departments must embrace and support these new data sources and tools alongside more traditional data warehousing and reporting infrastructure.

But a technology-led approach to enterprise reporting is almost guaranteed to fail — as is a top-down, IT-led approach. Ensuring user acceptance and cultivating a culture of data-driven decision-making ultimately determines the success of enterprise reporting initiatives.

Recently, a wave of self-service analytics swept across the enterprise.  Banks and Credit unions are now starting to embrace a more modern approach to enterprise reporting, with IT and the business partnering to derive maximum value from their data.  Many banks now consider big data and analytics as crucial for business.

Traditional sources of data for banks had been limited to the General Ledger, Loan, and Deposit applications.  As the financial industry is seeking to know more about their customers and gain a 360-degree customer view, more and more data is now being tracked.  Every customer transaction with the bank along with how they interact with the bank on social media are now important data points that need to be analyzed.  This marketing information is being blended with financial information to come up with better marketing initiatives.

As the volume of data and the need to collaborate have accelerated, so has the use of Cloud-based solutions for enterprise reporting.  Cloud-based solutions can scale up very quickly without your bank having to make sizable investments.  With companies moving their data to the cloud (as cloud solutions become more secure, reliable and easier to use), analytics’ move to the cloud is reaching a tipping point.

With more and more employees of the organization consuming data, data analytics will become a mandatory core competency for banking professionals of all types.  Much like proficiency in Microsoft Word, Excel, and PowerPoint, basic proficiency in analytics will become a staple in the workplace.  To meet this need, we’ll see analytics and data programs permeate higher education. In the workforce, banking professionals will leverage intuitive BI platforms, and data will play a role in every major decision.

The banking world has seen a shift in the way their customers transact with the bank from bricks and mortar to desktops and tablets.  Now their customers are transacting with the bank on their mobile phones.  This same shift in the way customers transact is happening to the way employees want to consume data and analytics.  To keep up, banks and credit unions are shifting from on-premise BI solutions requiring Virtual Private Network (VPN) access from their employees’ desktops to Cloud-based solutions that can be accessed by mobile phones.

Cloud-based enterprise reporting for banks that work in a mobile world requires good visualization features as no one is willing to scrutinize big spreadsheets on their mobile phone.  Dashboards, charts and graphs, and Key Performance Indicators (KPIs) are the best ways to understand what is going on with your data using a mobile device.  Cloud allows that analysis to take place.

As already mentioned, enterprise reporting is no longer limited to the finance and IT staff.  Many banks and credit unions are witnessing an increased adoption of self-service analytics.  The availability of self-service analytical tools has enabled banks to provide better services to their employees.  Allowing employees across any department or function to experiment and innovate with analytics, without the need for skilled analytics talent is a huge benefit.

Banks are increasingly equipping their workers with skills and tools to help them better understand data.  Employees of all levels are able to investigate issues, find solutions to challenges, and make projections or simply make discoveries.

This is a significant trend of banks shifting the power of data and data analytics from the hands of the specialized few to many.  As they empower their employees with data and analytics, they also need to eliminate silos to ensure that all data can be leveraged on.

Practical use of Cloud-Based Enterprise Reporting for Banks – Balanced Scorecard – If your organization is seeking to get into Cloud-Based Enterprise Reporting for Banks, the best place to start is to develop a balanced scorecard.  The Advanced Performance Institute states that the basic principles of Drs. Robert Kaplan (Harvard Business School) and David Norton’s original balanced scorecard model have proved hugely helpful in understanding bank wide performance.  Their main point was that a balanced scorecard should focus on the four key perspectives:

  • Finance
  • Customer
  • Internal Processes
  • Learning and Growth

The financial perspective – These metrics typically focus on revenue and profit goals.  A bank will compare these numbers to past performance, budget, and peers.  One measure I found effective was to compare branch profitability against the other branches.  Those that ranked in the top quartile got a score of four, the middle two quartiles a score of 3 and 2, and the bottom quartile a score of 1.  The goal of a branch was to not get a 1.  Another measure that is effective is the efficiency ratio.  This measures the cost of revenue which is calculated by expenses divided by revenues.  For example, an efficiency ratio of 45% means that every dollar of revenue costs $0.45 to raise.  The goal is to lower this ratio.

The customer perspective – This perspective looks at measures as they relate to customers and the market. They analyze customer growth and service targets as well as market share and branding objectives. Typical measures include customer satisfaction, service levels, cross-sell ratios, market share and brand awareness.  Much of this data comes from the marketing department.  The main goal is to increase the bank’s share of wallet of their customers and the surrounding market.

The internal process perspective – The bank is constantly making investments in the employees, technology, and bricks and mortar.  These measures review how effective these investments performing over time.  Some of the measures will be assets, deposits, or revenues per FTE.  Other measures would include revenues per square foot.  The key is to these measures is the payback of your various fixed investments.  If a measure is getting too high, you may need to invest in another FTE.

The learning and growth perspective – Focuses on the intangible drivers of future and is often broken down into the following components:

  • Human Capital (skills, talent, and knowledge)
  • Information Capital (databases, information systems, networks, and technology infrastructure)
  • Organization Capital (culture, leadership, employee alignment, teamwork and knowledge management).

Typical example measures and KPIs include staff engagement, skills assessment, performance management scores and corporate culture audits.  These types of goals are the hardest to measure and are often times subjective.  Some companies address this strategy by requiring each of its employees to obtain 40 hours of education per year.  They will offer many internal classes and tracked the hours by employee.

Where to go for help?  There are many vendors that offer Cloud-Based Enterprise Reporting for Banks.  If you are just getting started with the finance piece of your enterprise reporting, Oracle Hyperion Financial Management, SAP Business Planning & Consolidation, IBM – Cognos TM1, and Solver’s BI360 are all good solutions.

If you are ready to tackle the customer, internal process, and growth and learning perspectives, you will need a data warehouse with a good reporting engine.  You might consider IBM Cognos, SAP BusinessObjects, Oracle Business Intelligence Enterprise Edition (OBIEE), and again BI360 by Solver.  All of these solutions are offered on-premise as well as Cloud.  Although some of them might be easier to use than others they are up for the task of Cloud-based enterprise reporting for banks.

Whether you are tracking one or all four of the key perspectives in your enterprise reporting endeavor, BI360 by Solver is an easy self-service analytical solution that is enabling banks to make world-class decisions. Solver, Inc. is happy to answer any questions and generally review BI360’s easy-to-use, Excel- and web-powered enterprise reporting solution for banking and finance industry users.  Move Business Intelligence beyond just your finance and IT staff into all facets of your organization with a good Cloud-Based Enterprise Reporting for Banks solution today.