DataFlux recently commissioned a survey of financial services organisations in the UK to ascertain their views on data quality and data governance.

This post provides a summary of the main findings with links to the main survey report on the DataFlux website.

Financial Services Data Quality Survey

Do financial services companies take data quality seriously?

• Data is seen as a strategic asset (by nearly 9 in 10 organisations) and the quality of data is believed to be important in the UK financial services sector, yet investment is currently driven primarily by regulation (73%)
• Therefore many companies who are not sufficiently allocating the investment needed in their data are missing out a crucial competitive advantage in the market place
• Given this importance, the majority (9 in 10) have established a widely trusted enterprise view of data
• However, in practice, over two thirds are not managing their data at this level. Instead, data quality management tends to be fairly dispersed, with organisations managing it across multiple or individual business units
• Positively, data governance is clearly on the agenda, with a third having already completed a project and nearly the same proportion currently implementing or considering launching one

What processes or data management tools do financial services organisations currently have in place?

• Financial services organisations have a wide collection of tools at their disposal to manage data, with data cleansing (65%) and data quality (63%) tools mentioned most frequently
• Yet almost half of these tools are stand-alone solutions sourced from different providers
• Majority of organisations are equipped to process customer data against criminal lists. However, a significant minority (11%) report no such process is in place or they are unaware if any such capability exists in their organisation (7%). A surprising find, given this is a regulatory requirement that has been around for some time
• Responsibility for data quality or governance initiatives tends to be scattered across the business, and in a third of cases this responsibility belongs to the IT department. Interestingly, 16% of organisations claim ‘no-one has specific responsibility’

What is the future of the regulatory landscape?

• There is strong expectation of further regulation in the future, primarily focusing on security, accuracy and quality of data
• Data security issues appear to be well understood by many. In the context of further regulation, the main references are around the prevention of crime, increased power for regulatory bodies, tougher penalties for breaches, strengthening of enforcement and the Data Protection Act and guidance around the sharing of data
• Interestingly, nearly two thirds believe a lack of attention to or poor control of data within financial institutions is not linked to the recent financial crisis. However a sizeable minority (18%) felt that these issues were at least a contributory factor
• Most (2 in 3) agree data should be governed by universal standards but mixed views on the one key factor that would make this successful. The companies surveyed, indicate that content should be wide ranging, inclusive and industry led (as opposed to government led) with effective and consistent enforcement

What are the key challenges that face financial services providers in the next 12 months?

• Key challenges in the short term are thought to be:
  • Seamless data integration - the complications of consolidation and probably with less investment and resources available
  • Effective data management - ensuring data security, compliance with existing and any new regulation that is introduced, maintaining accurate and up-to-date information, determining who has access and how the data is used

To download the complete report: http://www.dataflux.com/UK-Financial