Comprehensive Data: Mother Lode Waiting to Be Mined
by Carl Meiswinkel
From tracking loan payments to uploading information from loan applications, all credit unions use data. But are we using it effectively or does it just seem like clumps of random facts? Most companies actually use less than 7 percent of what is available. And, most of that 7 percent is historical data – data that tells us where we’ve been, not where we need to go. Aggregating your data and relating it to other information allows you to capitalize on a valuable asset you might have overlooked – the veritable goldmine of data you already possess.
On its own, data isn’t very useful. But by centralizing it, you can turn data into intelligent, meaningful information that can stimulate your loan business, tell you more about members’ wants and needs, and provide a higher level of member service as well as monitor risk.
Seeing Value in Data
Recently, I attended a credit union meeting with a noted speaker. A mother in the audience asked where future jobs will be and what should young adults be studying in college to obtain those jobs. The speaker answered simply: meaningful data. Smart companies are making data easily available. And as they evolve, these companies are turning their data into meaningful information. The challenge lies in interpreting that data to provide a forward look.
Most financial institutions use data for risk assessment; yet, it’s valuable for so much more! In the marketing area, meaningful data can help you decide which promotions to offer certain segments of members. For example, suppose you can learn how many and which of your members regularly use their smartphones to reload their Starbucks cards. Could you correlate this data with those who opt-in for your credit union’s promotional text messages? Putting such data together may help you discover a slice of the market that is open to mobile banking.
Simply put, data is the key building block that provides direction, growth, profitability and risk management. It is vital to informed decision-making. It provides economic indicators, member profiles and performance metrics. It also leads to new products, customer satisfaction, and new ways of looking at things. Data is time and money, so it shouldn’t be ignored. It should be centralized, analyzed and acted upon.
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