FSI’s survey of data leaders reveals infrastructure gaps that could hold back future innovation
NEW YORK, April 16, 2024 /PRNewswire/ — Hakodacloud data engineering consultancy Snowflake today released its State of Data for Financial Services and Insurance 2024 report, surveying 145 director-to-CEO executives from large financial services and insurance (FSI) organizations ).
According to Hakkoda’s State of FSI Data 2024 report, 48% of leaders in financial services, fintech and insurance say they need a lot of outside help to monetize their data in 2024.
Artificial intelligence is poised to significantly disrupt the financial services and insurance industries over the next three years, with 97% of FSI organizations indicating that they believe generative AI will be important to their success within this timeframe. Additionally, 81% of FSI respondents are confident that their organization’s data team can build the AI capabilities they need and that they have the infrastructure in place to support AI workloads, and 84% believe their teams also have AI skills and experience for successful implementation. However, only 26% of FSI organizations have defined generative AI use cases that they are ready to implement. Critically, only 30% of surveyed FSI organizations have modernized their data stack.
Other findings of the State of Financial Services Data 2024 report:
- 70% of FSI organizations have not yet centralized their data in a major cloud data platform
- 74% of FSI organizations intend to centralize in the cloud in 2024
- 38% of FSI organizations cite data monetization as a top challenge
- 53% of FSI organizations outsource their data management
Leaders in financial services report a 136% return on their data investment and greater organizational data literacy than other industries, but their data infrastructure tends to lag behind other data-driven industries. Their data stacks were reported to be less scalable and efficient than other sectors surveyed, with only 8% of FSI leaders reporting that their data stores and pathways were “extremely efficient and scalable.”
- Financial services are behind the modernization curve — Only 30% of financial services and insurance organizations have centralized their data in a cloud platform. The FSI sector is also less likely to use data lakes, with only 37% of FSI leaders reporting that their business currently has one. Among FSI data leaders from director to senior director level, 58% see building and maintaining advanced analytics capabilities as a top challenge for their operations in 2024.
- Room for growth in key generative AI applications — 51% of FSI leaders report that their company uses generative AI for document description and metadata. Compared to other industries, they are less likely to use generative AI tools for data management and compliance (43%), data cleansing (43%), data cataloging (41%), schema matching (38%) and AI co-pilots (31 %).
- Financial services need help monetizing data — Only 22% of FSI organizations are currently monetizing their data, with 93% planning to monetize in the next two years. Data monetization was cited as a major challenge by 38% of FSI leaders (following only healthcare among industries surveyed). FSI organizations report low confidence in the efficiency and scalability of their data stacks, and 70% of FSI organizations have yet to centralize their data on a major cloud platform in 2023.
“The State of Data 2024 report shows that financial services organizations are eager to modernize their data stacks, implement generative AI and take advantage of data monetization,” said Anand Pandya, Global Head of Financial Services at Hakkoda. “FSI CIOs know they need help from modern data experts who understand their industry to achieve their data goals. Seizing the opportunities presented by powerful new data-driven technologies requires rapid execution on a long-term roadmap to demonstrate that tomorrow’s capabilities are ready today.”
A detailed summary and status report on financial services data for 2024 are available here.
The State of Financial Services Data report is derived from research conducted on behalf of Hakkoda by Lawless Research in December 2023 as a blind survey of 500 data executives from director to CEO level from large organizations across major industries. 20% of respondents came from organizations with less than 500 million dollars annual income; 29% with 500 million dollars to $999.9 million annual income; 37% with $1 billion to $9.9B annual income; 14% with 10 billion dollars or more annual income.
About Hakkōda
Hakkoda is the world leader in Snowflake consulting. We provide the talent and managed services that organizations need to transform their cloud data architecture. Our Snowflake professionals work with clients in highly complex industries to deliver data-driven innovation. To learn more, visit hakkoda.io.
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SOURCE Hakkoda, Inc.
