Cleaning Your Data Isn’t Enough. For ROI, You Need a Strategy

July 13, 2022

We wrote recently about the many ways building a data exchange can add value to mortgage companies. We used the familiar metaphor of data as the new oil. Here, we’ll take that premise a step further: data may well be the most valuable commodity in today’s world, but it’s also true that, to derive the value data can offer, a company has to have the right infrastructure in place.

Imagine, for instance, a home heated by a wood-burning stove. Even if the owners set up a drill on their land and struck oil and refined that oil into something that could heat their home, they couldn’t simply put the oil in the fireplace and expect it to work.

The same is true with mortgage companies that tap into their data. In addition to refining your data (deduplicating, standardizing formats, storing it in a single location), you have to have strategy and infrastructure in place to use it to improve your operations.

Read on to see how that might manifest in a mortgage company and how to ensure you’re positioned for success from the start of a data project.

(Want a bigger-picture perspective? Check out 3 Data Trends in Financial Services.)

Turning Data into Revenue in a Mortgage Context: 3 Examples

First, let’s look at three concrete ways mortgage companies can use their cleaned data to drive revenue to get a sense of the opportunity.

1. Highlight opportunities to cross-sell

Today, many mortgage lenders and servicers have customer data stored in a variety of places – CRM software, customer portals, application documents, etc. Standardizing and aggregating that data into a single location would create a 360-degree view of the customer so that it would be easy to identify potential cross-sell opportunities.

A servicer could, for example, identify customers who both qualify for a home equity loan and have children approaching college age. They might reach out with information about using an equity loan to fund education. 

2. Enable self-service

Increasingly, consumers prefer self-service for simple tasks and transactions. More than three-quarters plan to use digital self-service options well after the pandemic has forced them to.

The right data strategy can make that possible by enabling the creation of a customer-facing portal that allows for self-service. In addition to improving customer experience, this can also reduce the burden on your call center and front-line employees.

3. Improve loan officer productivity

In our last piece, we mentioned how mortgage companies can use data to fuel machine learning capabilities that improve operations. One such application is to use ML to automatically recommend the “next best action” for loan officers to take. This could greatly streamline daily work and improve efficiency for busy LOs.

These three examples aren’t mutually exclusive. A mortgage company could conceivably put all of these functions in place – and more. The key? Having a plan from the start.

Positioning Your Data Project for Success

Most mortgage companies don’t have a big enough IT team to undertake a data transformation project in house, which means they’ll end up working with a third party. Key to making sure that engagement leads to increased ROI from data is discussing business strategy from the start.

In other words, you should talk to the contractors you’re considering about data applications specific to your mortgage work. This is true in any industry, but it’s particularly true in highly regulated spaces like mortgage, banking, and insurance. Ideally, you’ll find a partner who understands the industry and its regulations just as well as they understand the nuances and complexities of data and analytics.

Here’s why: this team will be responsible for building automated systems that learn and make decisions based on the rules they build into those systems. If the team doesn’t have a deep understanding of, say, when it’s okay for loan officers to reach out to borrowers, they could build a system that sets your organization up for regulatory violations and fines.

Beyond regulations, they should understand how quickly it’s necessary for LOs to move when a borrower submits an application. They should have a sense of the complexity of document management involved in borrowing and the many parties involved. In short, they should be able to not just do what you think you want to do but advise you about what’s possible.

The NTERSOL team delivers on both fronts.

To Achieve ROI on Data Projects, Work with a Team that Knows Data + Mortgage

Monetizing data is one way mortgage companies can engage in digital transformation. And as we’ve noted in the past, digital transformation is a complex, ongoing process.

To ensure you achieve the ROI you budget for, choose a partner that understands how the long game of digital transformation fits into your business goals and impacts your competitiveness within your industry. 

For more information on how NTERSOL fits the bill, set up a conversation with us. We’d love to chat.

Author: Christopher Cronk
About: Christopher Cronk is Vice President and Managing Director of Data and Analytics at NTERSOL. He is an award-winning data and analytics executive with approximately 20 years of experience in professional services, management consulting, data, and analytics. Mr. Cronk has worked extensively across multiple industries including Communications, Financial Services, Insurance. Healthcare & Pharmaceuticals, Retail, Media, High Technology, and Automotive and has helped many Fortune 500 companies strategize, implement, quantify, and realize millions in ROI on their technology, data, and analytical investments.