FINANCIAL SERVICES PRACTICE, CEB TOWERGROUP INSURANCE 2014 The Corporate Executive Board Company. All Rights Reserved.

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2 CEB Financial Services Practice CEB TowerGroup Insurance June, 10, 2014 Making Your Data Work For You How Analytics Can Help Insurance CFOs

3 ROAD MAP FOR THE PRESENTATION Projects and Problems Best Practices A Success Story

4 Big Data Projects in Financial Reporting Common Business Intelligence Sources, 2014 Billing Claims Deferred Acquisition Costs Incentive Compensation Investment Accounting Liquidity Analysis Long-term Operating Plans Risk Appetite Stock Market Volatility Source: CEB TowerGroup Analysis, 2014

5 Data Architecture and Systems Today Attributes of Effective Data and Systems Architecture Percentage of Respondents who Agree or Strongly Agree

6 Low Data Quality Hits Decision Confidence Impact of Poor Data Quality Percentage of Respondents

7 Data Management Remains a Challenge The State of Data Management in Insurance, % Fully Operational Strategy 34% 22% Spending-Only Strategy Developing a Strategy 35% No Strategy n = 73 Source: CEB FS Operations Leadership Council Automation Survey, 2012

8 Analytics Automation Proves Difficult Issues in Analytic Automation Projects Percentage of Respondents who Agree or Strongly Agree 70% 60% 50% 50% 60% 47% 40% 30% 20% 10% 0% Obtaining Automation Resources Prioritizing Automation Projects N = 124 Managing Technology Complexity Source: CEB TowerGroup Adoption and Investment Survey, 2014

9 ROAD MAP FOR THE PRESENTATION Projects and Problems Best Practices A Success Story

10 Standardize Data Definitions with Business Partners FTE Data Definition Group Source: CEB Analysis and Anonymous Financial Services Firm

11 Establish and Communicate Enterprise Data Standards Standard Approach to Data Management Source: CEB Analysis and TD Bank Financial Group

12 Make Data Sources Transparent Centralized Metadata Portal Source: CEB Analysis and GlaxoSmithKline

13 Evaluate Data Quality Beyond Just Accuracy Common Dimensions of Data Quality Source: CEB Insight IQ Diagnostic, 2011

14 Create a Data Quality Heat Map Illustrative Source: CEB Insight IQ Diagnostic, 2011

15 Avoid Common Data Pitfalls What Common Errors Can Determine our Use of Data? Source: CEB Analysis

16 ROAD MAP FOR THE PRESENTATION Projects and Problems Best Practices A Success Story

17 Questions on Generating Big Data Insights What has been the impact of the growth of your analytics tool portfolio on your data strategy? Ensuring data traceability and quality? Creating the appropriate governance and ownership around data? Ensuring scale and consistency in data capabilities and usage? Leveraging financial data to manage long-term planning Source: CEB Analysis

18 Part 1: Managing a Plentiful Tool Portfolio Empire 1 Insurance Company s Analytic Tool Environment, 2009 Source: CEB Analysis and an 1 Anonymous CEB Insurance Customer

19 Determining Ten Key Analytic Capabilities Source: CEB Analysis and an 1 Anonymous CEB Insurance Customer

20 Analyzing a Diverse Portfolio of Enterprise and Specialty Tools Source: CEB Analysis and an 1 Anonymous CEB Insurance Customer

21 Following an Analytics Capability Roadmap Keys to Successfully Surveying Knowledge Workers on their Capability Requirements Source: CEB Analysis and an 1 Anonymous CEB Insurance Customer

22 Applying the Data Insight Gap Tool Components of the Data Insight Gap Tool for Insurers Source: CEB Analysis and an 1 Anonymous CEB Insurance Customer

23 Data Insight Gap Tool Rating Criteria Source: CEB Analysis and an Anonymous CEB Insurance Customer

24 Performing an Analytic Tool Gap Analysis Source: CEB Analysis and an Anonymous CEB Insurance Customer

25 Part 2: Populating a Decision Framework Federalist 2 Insurance Company s Analytic Tool Environment, 2009 Data Treat data as a strategic asset through data stewardship, management and transformation The Landscape is our firm s insurance goals, constraints and opportunities Landscape Analytics As analytics expands, we need to standardize and break down siloes Business Intelligence Decisioning Source: CEB Analysis and an 2 Anonymous CEB Insurance Customer

26 The Business Case for a Data Strategy Ingest Transform Store Analyze Output Current State Many Capture Methods Limited Scope Internal and External data into separate silos Multiple transformatio ns of the same data Too much time in ETL Lack of data attribution Redundant data Ad-hoc data stored forever Data stored at the uniformly regardless of importance Analysis can be costly or slow to be interpreted Poor data access Analysis is adhoc, siloed and inconsistent Limited output option Static, nonvisual output Islands of reports Source: CEB Analysis and an 2 Anonymous CEB Insurance Customer

27 The New Enterprise Data Architecture Internal Application Data ETL Information Delivery External Data

28 The Business Case for a Data Strategy Ingest Transform Store Analyze Output Future State Flexible and consistent big data feeds All data types Enterprise Standards for internal and external data Streamlined Processing Minimal transforms based on fit Master Data Management and Governance Store big data effectively Store for fit and criticality Information lifecycle management The right tools, models and data feed analysis Data is accessible and in the right format Data drive analytic success One set of reporting terminology Many output options and form factors Visual and Real time support Source: CEB Analysis and an 2 Anonymous CEB Insurance Customer