5 dos (and 2 don’ts) for automated performance tracking

Paying the phone and electric bills has been changed forever by autopay, tax season is less of a headache for many Americans since preparation software arrived on the scene, and even returning a few dollars owed to a friend can now be done with three or four clicks on a mobile phone.

Tracking performance is not so different. The latest report automation tools make it simple and—dare we say, even painless—to take data from different sources and store it electronically, using finance automation software. At the same time, banks can improve business processes because data is now searchable and analyzable with accuracy and ease.

PwC lists “report and modeling creation” as one of a few major pain points that financial-services companies face. The consulting giant estimates that through automation, banks can reduce the time traditionally spent by employees on “low level operational reporting” by 20-40 percent. 

Arguably, report automation is more important today than ever before. That’s because the amount of data that financial institutions are contending with has mushroomed. 

Banks are looking to automated performance tracking as a way to deal with a myriad of challenges. As they face the lingering effects of the Covid-19 pandemic, inflation uncertainty, unpredictable weather events and poor loan demand, being able to automate standard processes brings some certainty and relief.

The benefits of report automation

Not only are repetitive tasks made easier by automation, but automation can save a bank both time and money. According to PwC, “Introducing automation and complementary technologies like artificial intelligence can save a Global 2000 company in the range of $20 million to $40 million in annual costs.”

While savings for a smaller financial institution or community bank will of course be far more modest, the general message is the same. Using automation not only improves business processes, but it can help the overall bottom line.

Performance tracking best practices

When it comes to automated performance tracking, here are five important dos and two don’ts:

• DO consider your pain points and look for time-saving opportunities. Some of the typical pain points financial institutions face include an absence of system integration and the challenges of creating reports using visualization and stories. When it comes to report preparation, PwC estimates that potential automation enhancements could provide “time relief” in the 30-50 percent range. For reporting itself, PWC says that time savings would likely fall in the 20-40 percent range.
• DO ensure that the data you input is accurate. The old adage “garbage in, garbage out” applies to automation. One of the best ways to make sure your inputs will yield useful results is to create uniform structures and convert data now saved in various formats (pdfs, images, and spreadsheets) to a single, standardized structure.
• DO think of keywords for searchability. Automation makes your reports searchable and therefore more useful to executives analyzing the business and exploring strategies for the future. To make the reports as user-friendly as possible, consider the keywords you use, making them as searchable as possible.
• DO consider the value of an audit trail. With report automation, a bank gains an audit trail and greater visibility on all its payouts.
• DO keep tabs on emerging technologies. Artificial intelligence (AI) and machine learning are poised to change how banks operate—perhaps quite dramatically. According to a 2021 white paper by McKinsey, customers at traditional banks may wait anywhere from a day to a week for a credit decision, while at “AI-first banks,” decisions can be made much more rapidly, sometimes nearly in real time.

AI strategies are proving more popular since the pandemic. In fact, 55 percent of companies said that they had accelerated their AI strategy in 2020 due to Covid, according to a survey by Harris Poll, working with Appen.

• DON'T invest in software that isn’t tailored to your business. There are a wealth of new software tools out there, all promising to deliver the benefits of report automation. Financial-services companies—and banks, in particular—have unique needs and it’s therefore best to have a software tool designed to meet the challenges your business will encounter.
• DON'T underestimate the value of your human workforce. Experts advise using automation for the heavy lifting of report creation, but then make sure that your employees oversee these automated processes so they run smoothly. Automating routine financial reporting makes sense for many banks, but this doesn’t mean that your employees don’t still play a vital role in creating and analyzing the reports being generated.