02 July 2020 | Business Intelligence, Data Management
5 Questions: With Vedran Lescan, Co-Founder and Chief Business Development Officer at FinScore INC. He shares his expertise on data analytics and explains why it’s so important for every organization to understand that it has data and ensure that it is managed and utilized in the correct way.
1. Business intelligence and data analytics play important roles in informed decision-making and moving businesses in the right direction. The year 2020 (so far) has seen many changes due to the coronavirus pandemic. How has the role of business intelligence and data changed in this time and how will it evolve even further?
I think that businesses have, even before the COVID-19 crisis, started to realize (some sooner, some later) that the biggest asset they can have is knowledge. Not the lowest price or the best product or the biggest market share. It is the knowledge about their competitors, partners, other businesses, market, trends and their customers that enables them to make informed decisions, adapt quickly and develop sustainable strategies.
Most businesses turn to external data sources and forget that often it is their own data that sits unused and undermanaged.
We are living in a time where the technology behind analytics is rapidly evolving, but the business use cases are still lagging a bit behind, especially in the developing markets. Through data analytics technologies, we can predict behavior, demand, expectations, anticipated needs and how to best serve customers. Add this to knowing at what exact time the customer wishes to be contacted and what commercials would achieve the best results, and you have all the ingredients to develop a service or product, tailor-made for a customer that he or she can perceive on a more personal level.
This is exactly what I believe the future holds – targeted, tailor-made products and services through preferred communication channels at the right time. All based on the business intelligence of organizations and understanding the power of their own data.
If businesses combine their own data with other data sources, they unlock even higher potential and an even more focused approach, because we sometimes forget that “our” customers are also customers of other businesses.
2. You are well-experienced in business development. With this background, what are the benefits of advanced analytics and having that prediction power – the ROI of an insights-driven approach?
I will answer this question through an example that is very close to me. Take a country that is in a developing stage like the Philippines. With more than 7,000 islands and a population of 100 million people, more than 70% of the residents do not have any formal credit history. In effect, they cannot avail any of the standard financial service offering of banks and financial institutions to improve their livelihood. Even if they own businesses and have steady income, banks and financial institutions do not have the tools to assess and serve this market segment. This means that the market pie is smaller and as there are a lot of players that want a piece of that pie, the acquisition cost of a customer in this environment is already at a very high cost with an ever-decreasing ROI.
What they – banks and financial institutions in this case – need to do is open themselves up to innovation through data analytics and start utilizing alternative sources of data, like telecom for example. By doing so, an additional market segment is unlocked and new, objective and viable insights of customer profiles and behaviors are gathered through data analytics. When you can precisely predict the default rate on a loan of 100 US Dollar just by looking and analyzing an individual’s telecom data, you can create products and services that fit this market segment at a much lower cost. This ultimately increases the ROI because you can predict much more precisely their affordability and willingness to repay. The insights-driven approach allows for much more accurate business planning and resource optimization.
A different way to achieve better business profitability is through data monetization itself. Many businesses that we have consulted in the past have prepared their databases to be data-services ready and have created new revenue streams out of it.
3. What are the biggest challenges the tech industry is facing when it comes to business intelligence, data analytics and data management?
Again, it is most important for every business to understand that it has data and ensure that it is managed and utilized properly. This can be achieved through the following changes or improvements that are often seen as challenges rather than opportunities:
- New data analytics technologies need to be introduced, implemented and integrated within the core of the business
- Resources need to be constantly improved and expanded, such as educating and training employees, to keep up with the evolution of analytical technologies, its implementation and trends
- An innovation mindset on all levels of an organization needs to be fostered as it is crucial that each link of the chain understands that there is always room for improvement and innovation. This is even more critical on senior level as leadership is needed to change mindsets.
4. What are your tips to address tech industry challenges?
My first tip would be to see challenges as opportunities. Technology has always helped humankind throughout history and it always will. So, instead of thinking about it as a challenge, think what opportunities data analytics can bring.
My second tip would be to nurture and guide your employees. They are the heart and soul of every organization. Motivate them to look further and reach higher. Invest in their skills and knowledge so that they can improve as it will in the end improve your business. Employees should feel comfortable with new ventures and this requires extensive support from a management level.
My third tip is to be flexible and adaptive. Many businesses have undergone existential challenges as they did not feel the wind of change blowing around them. If your processes are manual and technology today allows you to automate and improve internal operations and customer journeys, do that. If you are struggling to understand why your customers do not buy your product more and data analytics can give you the answer, use that.
5. Final thoughts: What is the next big trend to watch?
I believe that the current trend of using business intelligence boosted by big data is going to stay and be accelerated. The world is changing and one of the most valuable resources at this moment is data, which is being generated on daily basis in enormous amounts. Today, based on data analytics, you can predict epidemics or public health issues, you can win baseball matches, accurately predict the weather, reduce equipment failure, prevent fraud and assess risk – it is in every aspect of our lives and should be in every aspect of an organization’s life as well.
That is why it is important to evolve with, leverage and benefit from the opportunities business intelligence and data analytics provide.
About the Expert: Vedran Lescan is Co-Founder and Chief Business Development Officer at FinScore INC. The company provides data analytics solutions and a credit scoring platform to the ever-growing needs of banks, financial institutions and credit bureaus in emerging markets – to obtain more reliable data about existing and new customers and approach unserved market segments. Vedran has experience in working within the telecom and fintech industry throughout Europe, Africa and Southeast Asia where he has successfully spearheaded the deployment of several telecom and banking solutions. He is currently completing his Global Executive MBA at the WU Academy in Vienna, Austria, with the purpose to share his global experience with peers and broaden his own.
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