The Decision Maker

The REAL Opportunity of Credit Union Big Data and Analytics

Posted by Austin Wentzlaff on Oct 8, 2014 1:58:00 PM

“Unity is strength... when there is teamwork and collaboration, wonderful things can be achieved.” –Mattie Stepanek

Big-Data_banner1-870x250The credit union industry (or credit union movement as it’s often referred to) is probably one of the most collaborative industries in the United States, if not the entire world. Unlike other organizations, credit unions share ideas and even their “secrets.” They truly care about the welfare of the industry and its millions of members. It’s great! Collaboration benefits credit unions in several ways but one way, in my opinion, presents the biggest opportunity. Big Data and Analytics.

The Problem

According to Credit Union Financial Exchange (CUFX), Credit Unions spend millions of dollars independently integrating similar technologies. From what we’ve seen, this is especially true in what I will define as Credit Union Big Data and Analytics. Credit Union Big Data and Analytics is comprised of data integration (data warehousing), report writing, and the creation of analytics applications and reports. Today, credit unions spend significant amounts of time and money building their own isolated solutions to satisfy pressing reporting needs. While this may solve the short term problem, the unique design hinders the ability to share reports and pool data with other credit unions. Different credit unions often spend resources building similar reports and dashboards. This begs the question that was recently raised by John Best of CU Wallet and Best Innovation Group. Are credit unions technology companies that deliver financial services or are they financial service companies that use technology?

The Solution

Big Data and Analytics presents a tremendous opportunity for credit unions but it becomes a REAL opportunity with collaboration. You’re probably thinking, “How can we collaborate our big data and analytics efforts with other credit unions? Every credit union’s data is different, including core data.” In order for credit unions to collaborate their big data and analytics efforts they need to have a standard data model. A data model that does not discriminate against core system, loan origination system, etc. A truly holistic solution.

With a standard data model, credit unions have an opportunity to greatly reduce the resources needed to execute a Big Data and Analytics initiative. A common data model will enable credit unions to “connect” to each other, allowing them to share reports and analytics applications amongst each other. When a report or application is built by or for a specific credit union, that credit union will have the opportunity to exchange it with all other credit unions that are connected to the data model. As a result, credit unions can immediately and effortlessly benefit by using others’ reports and applications shared in an “Application Store.”

Essentially, standardizing a data model gets credit unions out of the report writing game and into the report analysis game. This means less time and money spent collecting data and more time doing actual analysis. When you look at the amount of money big corporations spend on Big Data and Analytics you have to think, “Is this something I want to do myself or should I leverage the power of collaboration that already exists at credit unions?”

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Topics: Reporting and Analytics, Business Intelligence, Big Data, Credit Unions, Data Integration, Data Pool, Analytic Data Model, Data Analytics, Collaboration