The use of Business Intelligence and smart data analytics has become a common practice. Financial organizations use Business Intelligence tools to create competitive advantages by driving profits and reducing risks. The financial world is in constant change and managers need alerts and notifications when data changes in their transaction systems. They need to be able to access data and keep track of any anomalies that may occur. All managers and users need to see the same version of the truth. Off course, each user will only see what he is allowed to see according to previously set data access credentials.
This means that financial institutions need a centralized system, where users and IT work together and collaborate. Both users and IT must co-operate to define the processes and data flows, the permissions and restrictions, and the goals that they each want to achieve. Business users should decide what solutions they want to use to solve their business pains. And IT should decide how such solutions will be implemented in order to successfully govern over the data.
Before we dive into the specifics of the finance industry, let’s go over the difference between the two main BI models: centralized and federated. This will help us to better understand why financial institutions need centralization to ensure the success of their BI projects.
1. While in centralized BI users work connected, in federated BI they work in silos – meaning the findings stay in the desktop of the analyst instead of sharing the knowledge in a centralized environment.
2. In centralized there is one version of the truth. In federated there are thousands of Excel spreadsheets that cannot be merged. There is no sharing of knowledge when users work disconnected. The normal scenario in federated BI is that an analyst sends an Excel file to another analyst. IT then needs to keep many versions of the truth. This is commonly known as Excel hell. It is basically a data disaster. In centralized BI there is only one version of the truth. There are no unnecessary copies of data. People can share knowledge and drive analysis in the same, accurate context.
3. Centralized BI assures high usage because everything is in a unified solution. People can learn from one another. They can open discussions in the context of the data. All this without jeopardizing security. Users can work with confidence, knowing that there will not be any data breaches or leaks of information.
4. Centralized solutions are not closed apps like desktop solutions. They can be customizable to the enterprise’s and users’ needs. Customization is highly important to both IT and business users.
5. In a centralized platform, security and governability are IT’s responsibility. Analysts can share and distribute reports easily and quickly without worrying about security breaches. They can distribute a dashboard to thousands of bank managers and every manager will only see the data that they have access to. The job of the analyst shifts from answering the same questions all the time to distributing new findings. This can be done in a centralized system where people can learn from one another. And IT can administer the data transfer in the organization.
6. Centralized BI is easy to deploy and scale as more users want to use it. When IT want to provide access to new users, they do not need to install desktops. They only need to give them a name and password and set the data access permissions. IT can forget about installation and maintenance, as there is only one unified web solution to take care of.
The correct implementation of a BI project is a big challenge for any company. Financial organizations face an even bigger challenge when implementing BI because of the nature of the data they handle. They generate, collect, and analyze sensitive data, like credit card records, bank accounts, transactions, and other financial information.
