A new survey from Deloitte showed many organizations are not taking a consistent, company-wide approach to mining, reporting and analyzing risk data.
The survey, which fielded responses from 900 professionals, focused on the challenges facing data-management and analytics programs used by businesses to make strategic decisions based on risk. More than a third (37.4 percent) of respondents reported their companies are not taking a consistent, company-wide approach to such programs. While nearly one-third (32.7 percent) of boards and executives use detailed analysis from data collected across the company for important risk-management decisions, 11 percent of executives surveyed said their companies' data-governance programs were "non-existent."
"[Data governance programs] centrally assess, track, and govern data quality, data-management policies and procedures, usage and ownership, and the -golden sources' of data and how it is managed," explained Bob Walley, who is with Deloitte's regulatory and capital markets consulting practice. "Many organizations simply have not matured to the level where they can effectively think through a quality governance program."
The biggest challenges to risk-data-management programs included too many data sources (33.2 percent) and too few resources (28.6 percent).
"Data-discovery tools are useful for finding the data, but can't tell you it's the right data," Walley noted. "In many cases, it may be there, but it requires an organization to invest in the governance and discovery that need to take place in order to uncover it and ensure that it is reliable for use in management decision making."
Compliance regulations have caused some companies to run into difficulty as regulators raise the bar, he added.
"It often comes down to issues involving control and quality, fragmentation of product and customer systems, and data repositories used for different management purposes," he said. "A lot of companies have also taken a siloed approach to meeting specific regulatory requirements rather than looking at the whole picture."
Besides leadership support, there are a number of keys to success for risk-data-management and analytics programs. Among them, Deloitte recommends keeping the program business-driven and tackling smaller projects within the broader program.
"Business analytics programs are a huge undertaking for most companies," John Lucker, leader of Deloitte's advanced analytics and modeling practice, said in a statement. "When companies have full understanding and endorsement from top executives and board members, programs can be extremely successful, offering not only insight into future trends, but an advantage over competitors."