The world's information ecosystem runs increasingly on what we at IDC describe as "third platform" technologies. The convergence of intelligent devices (consumer products such as smartphones and tablets, as well as smart buildings, smart infrastructure, smart cities, etc.), social networking, pervasive broadband networking, and analytics will undoubtedly redefine the relationships between bankers and their customers and partners.

Banks will use this "third platform" to create products for small to enterprise business users, consumers, students and travelers that will provide content and experiences more tightly linked to their individual pursuits, needs and wants.

These applications and services will be built on innovative mash-ups of the third platform's four pillars and will create solutions and interconnect trillions of things that directly or indirectly affect our lives. Most banking executives agree that they must be successful at embracing these new technologies and the capabilities they enable, or else lose traction in the continuous march toward competitive advantage and improved profitability.

Business architecture, including everything from brand positioning to products and marketing strategies, to customer engagement and operating models, to performance of governance functions will be challenged by these technological advances as many firms look for sustained profitability and growth. Success will be more difficult to come by given current economics, as brands continue to be negatively impacted by performance, media and shareholder pressure, and increased regulatory oversight.

The third platform is already playing out in financial services, as seen in the continued build-out of cloud infrastructure and mobile banking platforms worldwide. But of the four major third platform trends, the implications of big data and analytics, and the infrastructure enabling big data applications seem to be least understood, based on recent interviews with bank IT executives earlier this year. However, more recent data suggests the fog is clearing.

At the end of 2011, IDC Financial Insights forecasted that over 40% of all Tier 1 firms would gear up to execute big data / analytics business and technology strategies in 2012.

Today, this forecast appears conservative, as almost 48% of firms we recently surveyed have implemented, are implementing, or are evaluating third platform financial applications built with big data technologies such as Hadoop and MapReduce, and over 21% plan to invest more than $1 million on their big data strategies in 2012, with a small perentage of firms, less than 4%, planning to invest over $100 million.

Many discussions around big data trends and applications in banking and other regulated industries quickly turn to issues of risk and governance. Can big data become a big liability? The answer is undoubtedly yes. Poor big data governance will most likely lead to management and system failures, breaches, and missteps, which in turn will generate standards, and potentially regulatory guidance. So now is the time for the industry to engage in discussions on a number of big data governance issues, including these top five:

1. Evolution of governance programs — How data governance and organizations' models will evolve with the advent of big data.

2. Ownership and privacy protection — What will be the impact on personal and corporate privacy and ownership protection policies when external data is on-boarded and intermingled with enterprise data.

3. Scalability of security — Can existing information protection and security systems and technologies properly scale to maintain a sustainable risk profile when assessing the confidentiality, integrity, and availability requirements of big data applications.

4. Lifecycle management — Are there new information lifecycle management, data inventory and classification requirements? How should decades-old records management standards of accountability, custody, stewardship, and so forth be applied to the big data trend?

5. Model governance — Analytics and modeling excellence are core to success in our industry. As big data, modeling and analytic excellence rise in importance as a differentiating business capability and compliance requirement, what steps must be taken for financial firms to re-orient GRC programs and explicitly focus on frameworks, goals, and best practices for model governance?

Over at least the last decade, data management has been in a reactive mode, responding to gaps in the environment exposed by inefficiencies, breaches and failures, which have led many times to new legal or regulatory imperatives. These reactions have fueled both the retrofit of existing processes for governing data (e.g., creating Sharepoint storage pools for unstructured content and file based data classifications schemes) and the acquisition of new point solutions to ease the pain of satisfying new requirements, such as electronic discovery. Now enter the era of big data.

The big data trend provides yet another chance to address what has been missing for many — proactive, strategic thinking about the data governance challenge. Data management is no longer only about messaging, databases, and storage, feeds and speeds. The big data trend should force management once again to see the degree to which data is permeating the organization and becoming more than ever the currency of third platform financial services.

The business challenge now is to govern this trend without restricting innovation, by ensuring that all big data is known, declared, classified and managed to maximize value and minimize risk.

Sustainable big data governance has to become part of the DNA of the organization and, like quality controls, embedded in every business process.

Michael Versace is a research director at IDC Financial Insights.