The need for sharing information must be in our DNA. It all started on cave walls, as Stone Agers chronicled their experiences.
Fast forward to today and with the introduction of social media platforms that primal urge has given us the proverbial easy-button megaphone enabling advisers, and everyone in financial services, to share information with their networks, intentionally or otherwise.
The problem is: Your network is a lot wider than you think, so how can you gain control of the data?
Social-media platforms are intended to be open and collaborative -- the opposite of basically any information security policy or protocol. So by definition, they were designed to be hard to control. To further complicate this challenge, businesses today now have data flowing from every seam in the organization. Inexpensive portable media and cloud storage solutions have made it so easy to transport and store things, it's almost impossible to manage. That said, for your business, how do you assemble and make sense of this data, determine opportunity and risk factors, and provide on-demand reporting?
Either way, as soon as something is written and placed on the Internet, all bets are off. More to the point, the illusion that data access on the Internet can be controlled is slipping between our fingers.
What to do?
Quite simply, the big question for everyone in financial services today is not, “How do I block this?” but rather, “How can I get access to this information, refine it into data we can use to make decisions, and how can I do it faster than the competition?”
This is a big challenge. The technologies needed to do this in-house are very complicated, numerous, and can be very expensive (from a product and resourcing perspective). This activity normally requires taking existing data and third-party data and merging it together to form a cohesive message that businesses can act on. This normally leads to the DIY vs. outsourcing discussion and, inevitably, the first question that is asked is if we outsource, who can we trust with our data?
If your business has the financial appetite to go the DIY route, there are many things to consider – skilled resources, technology acquisitions, third-party data feeds and, most importantly, the understanding from the business of what is important. So many times, organizations get to the point where they have resources, technology and data, but not enough guidance from the business analysts to say what information is needed to make all those things provide value back to the business. This is normally where “Big Data” projects fail; analyzing the business, how it operates, its customer base and needs, and what data is needed to enable decisions is arguably the hardest part. So don't underestimate it.
The same goes for outsourcing this need. Thorough due diligence needs to take place to ensure the right supplier is selected. A few things to consider:
1. Reference customers
2. Existing capabilities
3. Road map
4. Security assessments
5. Technology assessments
These things are very important, but comprise some of the basic, required items that need to be checked off the list. This will put you in the position to begin scoping out the engagement. Any business with the means and desire can achieve the above, and if they do and you don't, your competitive advantage will begin to erode.
Our industry demands layers of reporting to fuel analysis for the opportunity and risk we've discussed. Be it regulatory, sales, performance reporting or unstructured data (i.e. social media), it is imperative to know what we may not know. This involves mining the data we can assemble in new ways, discovering trends and taking advantage of opportunities while mitigating risks. Having a central platform to accomplish these steps will be your competitive edge.
Jim Olevano is the principal architect at RegEd.