Data governance executives in financial services sectors are becoming increasingly divided about the benefits and disadvantages related to the use of multiple data sources and systems. According to a Waters Technology report, it has become more difficult to facilitate data governance plans due to reconciling multiple data sources and attempting to defend systems redundancies to ensure data accuracy. Financial services firms are now beginning to think about how to properly implement data governance plans to manage multiple data providers or departments.
These data governance plans become more challenging because providers manage data and offer services in myriad of different ways. This can make it difficult for firms to have consistency, validity and accuracy in their data pulls. The reality is that data has the potential to be costly, but if firms are not extracting data effectively, it can cause them to overpay.
“It has become more difficult to facilitate data governance plans.”
Is the expense worth the value?
One of the issues inherent in attempting to source from multiple providers is that firms will often select on price points. All too often, the end result is data inaccuracy. The problem for financial services firms is that in order to make proper risk assessments, data accuracy is paramount. So these firms need multiple data providers to cross-examine with one another to ensure data quality. Multiple data sources costs more upfront to an organization, but will optimize data management, which will enable firms to reduce overhead and human capital costs.
Better management leads to more efficient expenditures
Firms need effective data handling and distribution in their governance efforts. With an understanding of data providers’ capabilities, these firms can find common ground between the expenses involved in using multiple service providers and identifying the most cost-effective solutions.
The goal is consistency because that will improve the quality of data. This is the key solution for firms as data governance plans require that data is properly scrubbed to ensure it is relevant and current. That is where centralized managed data services are a key factor in supporting governance plans – because data capture requires more effective storage. Ultimately, this will enable firms to save on time and money due to inaccuracies as the result of redundancies in data requests.