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Digital innovation is sweeping across the financial services industry and creating opportunities for banks and credit unions to leverage data as a source of competitive advantage.

Until recently, most credit unions were delegating data management and analytics to the IT department, which in turn created data silos that inhibited the enterprise use of data.

Has your credit union made the business case for creating an analytics team to spearhead important data initiatives? If so, you now need to hire or train the right talent that can turn data into value and deliver on your organization’s data strategy

Chances are you have numerous questions whirling around about how to define the key data roles and responsibilities.  When venturing outside the credit union to evaluate data leadership, this list of tips breaks down key roles and how they should align with your needs.

Chief Data Officer

The CDO is a senior executive who bears responsibility for the credit union’s enterprise data and analytics strategy, data governance, data management, and data utilization.  The CDO’s role will combine accountability and responsibility for information protection and privacy, information governance, data quality and data life cycle management, along with using member data to create business value.

This last point is arguably the most crucial.  If your analytics team is not delivering business value then you’re not achieving the team’s full potential.  The CDO should focus on measurable outcomes for specific use cases to provide the necessary cultural and change management sparks to garner enterprise-wide buy-in.

Data Scientist

A data scientist masters a whole range of skills and tasks from being able to handle the raw data and analyzing that data with the help of statistical techniques, to delivering actionable recommendations based on the underlying data.

The title “Data Scientist” has become a bit of a buzzword as of late.  If your “Data Scientist” can query a database, but the extent of the statistical knowledge is mean, median, and mode…they aren’t a data scientist.

Real” data scientists have deep knowledge of statistical and probabilistic models and know how to leverage those models for specific analytic applications.

The Data Analyst

The data analyst will retrieve and gather data, organize it and use it to reach meaningful conclusions.  The insights that data analysts bring to the credit union can be valuable in identifying and even helping to predict the needs of the credit union’s members.  They help develop effective ways to collect the data and compile key findings into reports to share with other teams within the credit union.

Think of the data analyst as the individual who translates between the technical world and the business world.  This individual needs to have basic competencies from a technical perspective, but, most importantly, they need to be able to interpret technical knowledge into practical business terms and vice-a-versa.

A good data analyst doesn’t just produce charts, graphs, and other fancy visualizations.  They produce clearly articulated meaning to describe what the visualizations mean to the business.

ETL Developer/Data Engineer

The ETL Developer/Data Engineer is a critical member of the data analytics team as they are dedicated to the fundamental process of capturing, storing and processing your data.  If your CU leverages a data warehouse as your analytics platform, then the “ETL Developer” most aptly describes the job title.  If your organization is leveraging a data lake or hybrid platform, “Data Engineer” is a more appropriate title.

In the end, this role boils down to ingesting new data sources into the platform.  This may come from non-core third-party applications (i.e. consumer LOS, real estate LOS, online banking, etc.) to external data sources (i.e. demographic data, economic indicators, social media interactions, etc.).

Report/Visualization Developer

To effectively deploy self-service reporting and analytics through your BI portal (i.e. Tableau, Power BI, Information Builders, etc.), someone must be tasked with creating these reports and dashboards. This is the critical role of the Report/Visualization Developer.

If your credit union embraces a more decentralized approach to data analytics, then these resources may reside in the business areas instead of centrally managed.  Regardless of where they reside within the organization, this is an essential function for providing a front-end to your analytics platform.

The Right Role for Your Credit Union?

As credit unions grow and look to remain competitive, there’s an obvious need to hire the right data talent who are highly skilled in analytics, who can interpret data, and insight and tangible business value. Demand for data expertise is growing every day. Be sure to understand which roles are specifically needed by your organization.  Most credit unions don’t have the necessary budget to hire each of the resources discussed.  Determine where the greatest internal need exists and identify strategic partners who can assist with the rest of the functions.

The bottom-line, all organizations have the power to become data-driven by accessing data skills – and on almost any budget.  Ready to formulate a winning data analytics strategy?  Contact The Knowlton Group to get started.

Sources:

  1. Gartner Chief Data Officer Survey

 

Understanding The Benefits & Problems with Data Lakes

As more credit unions want to up their competitive game through data and analytics, the debate between data warehouses and data lakes continues. While solution providers and analysts line up on both sides of the discussion, understanding the advantages and drawbacks of a data lake can help your credit union determine if it’s truly the best fit for your needs.

To clear any confusion, let’s recap the main distinctions between a data warehouse and a data lake from our previous article. Both serve as data repositories, however, the data warehouse integrates primarily structured data from multiple data sources into one centralized, single-source of truth. It is then made available to run complex queries fast and efficiently. The data lake, on the other hand, offers credit unions the ability to store vast amounts of raw and unstructured data in its native form until it is ready for use when it is then transformed for analytics, reporting and visualization.

The Data Lake Upsides:

Boosts Competitive Advantage: As a tool, the data lake is helping to redefine the way credit unions analyze heaps of unstructured data for business decision-making. With the tremendous increase in competition, the need to analyze and utilize member data from all sources will be crucial. The data lake facilitates quick decision-making, advanced predictive analytics, and agile data-backed determinations.

Converges Data Sources: Data lakes can help resolve the nagging problem of accessibility and data integration. Credit unions can start to pull together massive volumes of data from various sources for analytics or to store for undetermined future uses. Rather than having dozens of independently managed collections of data, you can combine these sources into the unmanaged data lake.

Delivers Fast Results: Data lakes provide a platform to transform mountains of information for business benefits in near real-time. The data extracted from the data lake can be queried for information and analysis and further decision-making.

Reduces Expense: A data lake built in a public or hybrid cloud environment can help reduce some of the cost required to store raw data. Additionally, the data lake can potentially help cut costs through server and license reduction.

The Data Lake Draw Backs:

Lacks Compatibility: The capability of a data lake to be able to store data in a way that it’s constantly retrievable and queried must be built in to the data lake through unique metadata tags. Without these tags, the data lake quickly dissolves into what many have dubbed the data swamp.

Requires Expertise: Data lakes are only as good as the person fishing in them. Someone with extensive skills must be tasked with ingesting the data, cleansing it, analyzing it and acting upon it. A data lake, at this point in its maturity, is best suited for the trained data scientists. To effectively transform the raw data into useful information, it requires the expertise that many credit unions do not have in-house today.

Hinders Security: By its definition, a data lake accepts any data, from any source, without oversight or governance. Data lakes focus on storing disparate data but do not focus on how or why data is governed, defined and secured. Experts agree that data lakes are a target for hackers. Since the technology and security capabilities are still emerging, it could put the credit union at risk and pose compliance problems.

Skews Results: Since the data stored in a data lake is unstructured and has potential data quality issues, the credit union runs the risk of the analytics being misinterpreted, inaccurate or imprecise.

Creates Data Graveyards: The reality for many credit unions is that data lakes are becoming data retention ponds. It is quite possible that the credit union can discover that they are simply just storing heaps of raw data, unable to make use of the data for problem-solving and business growth. Data lakes require solid cleaning and archiving practices. Without implementing a data analytics roadmap for how to use the data and a solid business intelligence strategy, the data lake can quickly become an expensive repository.

Consumes Time: Since data lakes hold mountains of unstructured data they can potentially squander the valuable time of the data scientist if most of their initial efforts are spent preparing and cleaning the data before any analysis can even begin.

Know Your End Goal
Credit Unions should enter any new technology investment armed with questions and answers. In today’s fiercely competitive financial environment, where every single scrap of data matters, it’s important to stay abreast of all the data analytics tools available. However, we caution our readers to do their homework before diving in. Credit Unions should be careful of jumping right into data lakes and using them as the main integration source for analytics. While the vision for data lakes has been focused on making large amounts of data available quickly, the credit union needs to first strategically assess their current and future business goals, consider the pros and cons of the data lake, and then determine the best tool for the job.

Are you looking for more tips and helpful advice on data management? At the Knowlton Group, we believe that the best data and analytics program starts with a great strategy and clearly defined roadmap and implementation plan. Our personalized approach to each engagement ensures that the specific needs and goals of your financial institution are captured for maximum results. Contact us today to get started.