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Firms that excel at data analytics also achieve better financial results according a study by EY.

High-growth companies are twice as likely to focus on data and analytics in revenue-generating areas such as marketing and sales, EY’s The science of winning in financial services survey found. These organisations ‘corral data and apply it strategically across their business’.

More than a quarter (27%) of high-growth companies – those achieving EBITDA growth of 15% or more in each of the last two years – describe themselves as “excellent” at extracting useful insights from data that improve overall competitiveness and performance, compared to only 12% of low-growth companies. Thirty-five percent of high-growth companies say they are “highly mature” at this task.

“Given the pervasive impact of digital on the financial services industry, it is clear that getting data management and analytics right will create significant competitive advantage for companies,” said Errol Gardner, EMEIA financial services data and analytics leader at EY

Harnessing data’s competitive capabilities goes beyond technological investments, the report says. High-growth companies are more likely to increase spending in areas such as change management and personnel and skills. In both of these areas, 24% of high-growth companies plan to increase their spending by at least 20% over the next two years, compared to just 7% of low-growth companies.

Companies previously focused most analytics efforts on finance, though marketing is now identified as the function where significant improvements in data-driven business insight will be seen next. The most advanced analytics functions at high-growth companies are spread across sales (24%), finance (22%) and marketing (14%), while the finance function at other firms has dominated, the survey found.

Hyong Kim, EY Global and Americas Financial Services Data and Analytics Leader, says: “Financial services firms are focusing their analytics efforts on new opportunities to enhance revenue by mining customer data, although most companies have much more work to do in this area. Developing a clear vision of how they want to analyse data will help companies define how information will create value for both the company and the increasingly connected customer.”

While nearly 40% of all companies polled have appointed a chief data officer, firms struggle to find adequately skilled data scientists to fill their teams. Only 7% of financial services companies surveyed say they have sufficient numbers of data analysts throughout their businesses.

According to the survey, this shortage is partly due to companies requiring a mix of skills and experience: both those with a pure data science background, and those with more experience with commercial applications. And despite the competitive salaries of the financial services sector, potential candidates face lucrative offers from other sectors, particularly the high-tech industry.

The top two obstacles for companies in maximising their data use are concern over regulatory issues (43%) and data privacy restrictions (36%). In fact, one in five financial services companies (21%) expect spending related to data privacy to increase by 20% in the next two years, and 15% say the same of spending on governance and oversight.

Gardner says: “Many financial services firms have used data analytics primarily for risk and regulatory purposes, rather than the potential for growth. Making that transition to analytic-driven growth will require a systematic approach to improving capabilities throughout the business while maintaining a commitment to compliance.”