RBC's massive data management project is nothing if not ambitious, a multi-year effort that's reimagining the accrual and deployment of numerical and demographic intelligence across the entire business.
If the initiative realizes its sweeping potential, it will have found retail banking's ark of the covenant - the historically hard-to-attain unified customer view. "As it's evolved, the data warehouse has gone from reporting what happened to saying what will happen to making it happen," says John Burke, a vp at Teradata in Miamisburg, OH, which deployed the data warehouse at the Royal Bank of Canada (RBC).
Making it happen at RBC means combining existing data with new data and emerging tech architectures to meet a long list of goals, including a unified view of the enterprise and clients, cost controls, elimination of redundancies, consistent presentation of the bank across channels and constituencies, and an overall increase in the institution's agility.
RBC did not provide an executive for an interview, nor did it provide ROI for the project thus far. But in prepared statements supplied to BTN, Mohammad Rifaie, vp, enterprise information management, said strong data governance is an overarching enabler. "It is very easy to see where economic efficiencies can be realized, as you eliminate the need to acquire unnecessary infrastructure...[and] eliminate the need to acquire additional staff to support redundant data silos," he said, adding the project will eliminate the "complexity that would otherwise prevail in understanding the various potentially divergent business rules applied to the various silos."
The project also portends a next step in the way banks use data as a means to drive a number of disparate yet concurrent corporate and customer-facing value propositions. "The financial industry is getting mature in its approach to data, and the understanding of how to manage data once it's been warehoused," says Jeanne Capachin, research vp for Financial Insights, an IDC company, in Framingham, Mass. "There's more sophistication in the types of information that are being saved, and banks are taking care to make sure it's accessible as well."
RBC is not only hunting for replication in data stored in different business lines, but is also seeking ways to use information extracted for one business line to enhance the data-driven functionality of other verticals. The straw that stirs this drink is parallel processing, or the use of processors to enable multiple data threads to be accessed simultaneously, which in turn allows for broader and faster delivery of data to more locations. "If there's 50 'boxes' of data, we can get all of those boxes working at the same time," Burke says. "It's like running all 26 miles of the marathon at the same time."
This allows the institution's analysts to improve business rules used in credit card monitoring, achieve higher extraction rates and increase the number of transactions that can be tracked simultaneously, aiding in fraud detection, credit risk analysis, segmentation, campaign management, profitability and tailored cross sell. "The institution can run queries for specific statements or datapoints on an ongoing basis, rather than doing a search every month or so," says Joel Pruis, director of advisory services, Experian Decision Analytics.
The customer-facing piece can be particularly beneficial for RBC since unified customer data helps foster consistency in records, which is important for reporting; and transaction and relationships history, which aids in customer service. "Much has been said of the weaknesses in CRM systems," says James Van Dyke, founder and president of Javelin Strategy & Research. "But it's not the systems that are weak, but the integration of data or appropriate modeling for the use of that data in CRM systems."
Van Dyke says overcoming this weakness can go a long way toward eliminating poor customer service practices, such as pitching a product a customer already has.
RBC is an early North American adopter of Teradata's latest version of data warehouse technology, which is also the midst of deployment at a number of financial institutions in the EMEA region, including UniCredit Group, Alior Bank and Banque Accord in Europe and Huishang Bank in China.
Teradata's competitors to gain data management share in the U.S. include EMC and IBM, among other firms. An EMC spokesperson says it offers a series of "FLASH" products that enable performance acceleration of business intelligence and analytics applications for data mining, and improvements in batch processing and ETL (extract, transform and load) operations for data warehouses. IBM did not return requests for comment.