To
meet business priorities and market demand, banks have now shifted focus from
Information Technology (IT) to Information Management (IM) indicates
KPMG’s Information Enabled Banking Survey (IEB) launched today in Mumbai.
The survey was conducted amongst top 10 private banks based
out of South India to understand the current Information Management landscape
of banking industry. According to the survey, Information Management is the
ability of organisations to capture, manage, preserve, store and deliver the
right information to the right people at the right time and at an optimum cost.
According to the KPMG survey, IM ecosystem encompasses all
areas of the bank, interlinking key areas around strategy, data quality,
standardisation, systems, analytics, security and people. Some key fundamentals
of an IM strategy are Centralisation, self service delivery model, automation,
rationalisation and harmonisation, standardisation and outsourcing and
performance management. Each of these blocks will enable a Bank’s
capability to leverage their IM capability and re-align IM investments to their
strategic focus.
“With the
emerging significance of IM Strategy, analytics, data quality and
standardisation, a well designed and implemented IM function will not only enable
business strategy of a bank but also define the same. The Indian banking
space has become very competitive and with potential new entrants from private
sector, home grown Indian bankers will have to gear up and focus on leveraging
their IM capabilities better. This could well be a key differentiator in market
if bankers can utilize their IM systems to define an Information Enabled
Banking strategy for their customers.” said Kalpana
B, Partner, Management Consulting, KPMG in India
Data quality is one of the fundamentals for a bank in
having robust IM capabilities. Ensuring quality of data is a common challenge
faced by the banks considering multiple input sources, extensive digitisation
of existing records and large data. According
to the survey, 33 percent of the respondents use automation in their monthly
report generation process and 44 percent have minimal manual intervention, so
as to reduce data quality issues. In comparison to this, 67 percent claim to
have clean and standardised data across systems.
Most banks today follow a standardised reporting format at
the local branch, region, zone and at the corporate level, but the major
challenge the banks face is standardising the report generation methodology
despite having a standardised reporting form and clearly defined output. The
survey suggests only 11 percent of the respondents perceive that they have
advanced standardisation maturity, indicating there is scope for improvements.
The outcome is continued higher IT investments without strategic cost benefit
Business Analytics help banks identify areas of competitive
advantage and risks. Leading banks use analytics to track behavior of customers
by identifying spending patterns to leverage on cross selling opportunities.
Data availability and Data Quality are the pre-requisite for any Business
Analytics capability. 44 percent of the
respondents of the survey revealed that they require at least some amount of
manual intervention before they can use the data for analysis. Only 44 percent
of the surveyed banks use a Business Analytics Tool. 22 percent of the
responding banks have an Institutionalised procedure for business analytics
Going by the survey it is understood that information
management is now recognized as a key function by banks. The Information
management objectives across banks are cost efficient IM organization, business
partnering decision support systems, insightful information systems, value
realisation from IT investments through centralisation and outsourcing. These
objectives need to be realised and attained in a systematic manner for banks to
be able to achieve top line growth.
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