Adox Research report proves huge opportunities for proactive firms and assesses progress already being made

In an environment where financial firms are facing the regulatory need for increased transparency alongside a continued increase in data volume and velocity, the “ability to leverage data to analyse product and customer profitability, market opportunity and product suitability is critical to survival and success – and the time horizon for this data-centric reckoning is surprisingly short.”

This is a key conclusion in a new Research Paper, produced by Adox Research Ltd and commissioned by Gresham Technologies plc, the leading software and services company specialising in providing real-time data integrity and control solutions. Due to be launched as part of a webinar on 2 July, the Research Paper and corresponding research* looks at how regulatory pressures can and will be converted into business opportunities as part of financial services firms’ investment into better data control and oversight.

Titled “Fast & Open Data: Who, Why, How?” the paper highlights a number of key findings (graphs attached):

1. Two thirds of respondents expect data monetisation to deliver between 10-40% of new business growth over 2 years;
2. 49% of firms are already repurposing compliance deliverables for strategic transformation;
3. Traditional banks are identified by respondents as the single largest beneficiary (40%) of transparency and open data initiatives;
4. Customer centricity and improved decision-making support are the top two business drivers for investing in data quality and control.

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Introducing the challenges facing the financial industry, Gert Raeves, Research Director at Adox Research, notes, “There is a fundamental shift we can observe across all data points in this survey: banks and asset managers have moved beyond the predictable and unavoidable, and are taking the opportunity presented by combined projects to solve long-standing challenges of data quality and control”.

Paul White, CMO, Gresham comments, “The effort required to meet the regulatory burden has been huge, but forward-thinking firms now are actively searching for ways to reuse compliance-led deliverables for strategic business reasons and to identify new opportunities. Better data quality and control gives firms the ability to monetise that data, improving customer services, assessing product viability and analysing market opportunities in an entirely new way.”

Firms already repurposing compliance data are doing so in multiple ways. The report highlights examples such as digitising customer experiences, selective outsourcing, targeted automation and the overhaul of vendor partnership models.

Gresham sees similar trends in its work with clients for whom introducing automated tools, intelligent interfaces and streamlining tech stacks leads to a 60% reduction in costs and a 20% saving in resources over five years. For a recent Gresham bank client, onboarding of new controls was transformed with the implementation of the firm’s Clareti platform. From 60 days for one control, the bank is now delivering 80 new controls each month. Increased efficiency has improved the bank’s ability to evidence regulatory compliance while simultaneously delivering £3 million in operational savings annually.

The report also examines the barriers to investment in data control. Respondents cited the need to manage the regulatory compliance burden, and the complexity of legacy technology and integration as the two most significant barriers.

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White added, “These findings don’t surprise us. In the past, data integration and the management of legacy systems have been the main obstacles to transformation projects, with the key challenges being disparate systems, across multiple locations, varied data formats and outputs. However, we are seeing first-hand how innovative firms are leveraging compliance projects to solve the long-standing problem of data quality and control.”

Research methodology:

* The research was conducted by surveying 70+ senior financial services executives with technology buying responsibility during March and April 2019.

• Geographical breakdown: North America (USA,CA) 29%, UK 21%, EU (non-UK) 28.6%, APAC 14%, MEA 7%.

• Segment Breakdown: Asset Manager 27%, Sell-side Banking 43%, Custodian 1%, Universal Bank 17%, Lending/Accounting 11%.

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