Technology

EXCLUSIVE: Wealth Firms Need To Be Smarter About Big Data

Tom Burroughes Group Editor 31 May 2017

EXCLUSIVE: Wealth Firms Need To Be Smarter About Big Data

Far too many wealth managers and financial services firms aren't spending money wisely on Big Data and in some cases, wasting it. A report by a firm tracking such issues recommends changes.

Financial service firms trying to exploit use of “Big Data” have too often spent money that hasn’t produced results or even ended in failure, suggesting too many of them aren’t asking why they pursue such ventures in the first place, according to MyPrivateBanking, the Switzerland-based research firm, reports.

There has been a flurry of interest around Big Data, a term defined, according to a following formulation, as “Big data is high volume, high velocity, and/or high variety information assets that require new forms of processing to enable enhanced decision making, insight discovery and process optimization”.

“Too many financial actors focus on the `how’ of implementing Big Data projects rather than the `why’ and this is a sure way to set Big Data projects up for failure,” Onawa Lacewell, senior analyst at MyPrivateBanking, said in the report. “Successful projects must have a needs-based focus, with the primary business objective always at the centre of the implementation process. With this approach Big Data offers tremendous opportunities to serve existing clients better, acquire new ones and at the same time save costs and solve support compliance,” Lacewell continued. 

Big Data is one of those features of digital life that are shaking up how wealth management firms, and the financial services sphere more broadly, operates. The ability to use huge data sources to chart client behaviour and prospect for new business are some of the prizes in view.

Change of course
The research firm said wealth managers need to change how they put Big Data projects into use. Instead of finding the vendor/solutions first, they must work out what their organisations actually need, what data best meets those needs and then choose the suitable infrastructure. 

The report said Big Data solutions “will always require a tailor-made approach” linked to needs, although there are general rules of thumb that apply, such as always keeping the end-client in mind and be sure that data is absolutely necessary. 

The report is based on profiles of 30 vendors catering to the Big Data needs of wealth managers. The report is called Big Data For Wealth Management – A Practical Guide For Successful Implementation.

 

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