CHICAGO, Oct. 16, 2019 (GLOBE NEWSWIRE) — Across the globe, companies are amassing volumes of data with the intent of optimizing performance, identifying trends and meeting rising consumer expectations. Yet nearly 75% of financial services and insurance executives admit they are challenged by the fractured nature and vast amount of data available. As a result, it’s difficult for many of them to achieve rich analytics capabilities to further their respective businesses.
Even with these challenges, a new Aite Group study commissioned by TransUnion (NYSE: TRU) found that executives in the financial services and insurance industries plan on continuing to secure more data sources. Furthermore, they look to incorporate more artificial intelligence (AI) and machine learning (ML) technology into their analytic platforms to help them make sense of the information.The global study explored the existing analytical processes, tools, data sources and operational effectiveness of analytics solutions used by the financial services and insurance industries. The quantitative online survey recorded the feedback of 682 marketing and risk executives at financial institutions located in the U.S., Canada, U.K., Hong Kong and India, many of whom do business across the globe.The study found that the proliferation of AI/ML is expected to continue over the next 24 months with three in four global executives considering integrating new analytic technology into their platforms. There’s good reason for this implementation as AI and ML can shorten the traditional analytic lifecycle from months to just weeks or even days.“Businesses are reevaluating their technology investments, and looking to implement artificial intelligence, machine learning and alternative data models and sources,” said Gene Volchek, senior vice president of global data science and analytics at TransUnion. “Their end game is to gain deeper analytics and competitive insights that better allow them to mitigate risk and meet consumer needs. Ultimately, the companies that best leverage these data and analytical technologies will provide consumers with the best experiences, resulting in more revenue.”Help Wanted: Talent and Technology to Enhance Analytic CapabilitiesTo stay competitive in a data-rich world, companies need access to cutting-edge analytic solutions and data science expertise. However, the study found that inflexible legacy technology, talent shortages and regulatory barriers are among the factors that prevent businesses from harnessing the power of analytics with speed and ease.“Most financial institutions lack a single, cohesive analytics platform,” said Tiffani Montez, senior analyst at Aite Group. “Firms may have vastly different data repositories and teams managing analytics functions, often leading to multiple approaches – by line of business, role and channel – across their institutions. To address these issues, many financial institutions are looking to centralize their data into a single platform that can quickly support change and integrate new data models.”Enhancing analytic capabilities through AI/ML technology is a top priority globally, but with distinct differences across geographies. The United States lags in AI/ML technology adoption with 22% of U.S. executives indicating they currently do not have any solutions that can implement AI/ML into analytical models. While this capability may be commonly lacking, 66% of U.S. respondents also believe this technology is a major differentiator.The data scientist talent shortage is another pressing issue contributing to the global insights gap. As the volume of data has increased, the need for data science and analytics professionals has increased exponentially. Globally, 86% of respondents noted there are challenges with accessing the right data science and analytics talent, compared to 74% of executives in the U.S.To enable purposeful insights development, it is crucial for companies to streamline their processes and have closer alignment between the technical tools that are readily available and talent with specialized knowledge of turning data into insights. In the report, financial institutions noted they are increasing their investments in both talent and in analytics technology – but these firms are also greatly increasing their investments into another resource, more data.
Despite Challenges Surrounding Analytic Capabilities, Data Sources are Expected to GrowFinancial institutions have placed an increasing amount of importance on the value of expanding data sources. Among the banking and insurance communities, the desire to invest in data includes new sources such as non-traditional, third-party and alternative data. Over the next 24 months, 89% of institutions have plans to use alternative data.More than half of respondents plan to increase spending on most types of data sources with 65% intending to increase spend on newer forms of data such as mobile information about web browsing and app usage. In the U.S. alone, 44% of executives indicated that the integration of new data sources will be very important to their business strategies. Yet the lack of the right tools continues to pose an issue as only 14% of U.S. firms can integrate new data sources across all of their analytic solutions.The survey also found that across all regions, 78% of marketing executives and 70% of risk executives expect their overall budget to increase year-over-year, for data analytics /big data and analytics/data science tools for each role, respectively. This points to a significant investment in expanding the amount of data available despite ongoing challenges such as data cleansing and prep, which 76% of respondents said can be significantly challenging. This is in addition to the larger operational issues such as cumbersome technology and the talent deficit.
“Integrating data from across a consumer’s credit journey provides a rich canvas for drawing insights, however it is clear that financial and insurance industries are struggling to manage and extract the right information without access to the proper analytical tools or having people with the right skillset. Those companies that put in the investment will also most likely develop the top solutions that make them more competitive in today’s consumer-driven market,” concluded Volchek.To learn more about the state of analytics in the financial services and insurance industries, please access the full Aite Group and TransUnion report, Current State Assessment: Global Analytics Ecosystem. Lenders and carriers interested in developing models and other analytical solutions can collaborate with TransUnion’s highly skilled data scientists and analytical experts, and learn more about engaging with them in an immersive Innovation Lab. More information about TransUnion’s analytics solutions can be found here.About TransUnion (NYSE: TRU)
Information is a powerful thing. At TransUnion, we realize that. We are dedicated to finding innovative ways information can be used to help individuals make better and smarter decisions. We help uncover unique stories, trends and insights behind each data point, using historical information as well as alternative data sources. This allows a variety of markets and businesses to better manage risk and consumers to better manage their credit, personal information and identity. Today, TransUnion has a global presence in more than 30 countries and a leading presence in several international markets across North America, Africa, Europe, Latin America and Asia. Through the power of information, TransUnion is working to build stronger economies and families and safer communities worldwide.We call this Information for Good.® http://www.transunion.com/businessA photo accompanying this announcement is available at: https://www.globenewswire.com/NewsRoom/AttachmentNg/80270ab1-5b97-4f20-9075-36eeeaa205a9
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