Fine-tuning data analytics

Jeffreys, who is responsible for Wells Fargo’s operational and analytical data, including managing the bank’s customer information system with approximately 60 million customer records, knows the value of data. And with that information spanning 84 unique business lines across the company, he also knows that efficiency around data management is vitally important.

“Delivering more effective data management is one of our biggest focus areas this year,” Jeffreys says. “Based on this priority, we’ve built a strong data analytics practice and a strong data governance across the company. To that end, we have a major project underway that will enable us to share and connect data better across our diverse business lines for analytic purposes and cost efficiency centered on data analytics.”

One of the big-ticket items along that initiative comes in the form of enterprise metadata, with significant investment in the bank’s enterprise metadata repository to help facilitate the sharing of data across the diverse corporation.

Today a large percentage of Wells Fargo’s data is covered by the enterprise metadata repository – helping to identify the meaning behind data fields with the ability to more clearly see the origin and lineage of data. The enterprise-wide commitment to better understanding and sharing data represents a big step in data governance for the company.

Another critical component of Wells Fargo’s data analytics efforts is the company’s enterprise data warehouse, which pulls data from nearly every major source system across the enterprise. Currently, Wells Fargo is working to make the warehouse more accessible and more connected to individuals using and sharing the data.

“We’ve been putting in the connections between the various sources of data so that anyone who’s doing analysis work that involves data from several different sources can do that much more easily,” Jeffreys says.

For a large, diverse corporation like Wells Fargo, it’s important to be able to conduct analysis quickly and flexibly without having to go through the bureaucratic hoops typically associated with finding and understanding data sources. Thus, strong coordination across the enterprise is required to get to data fairly quickly and to allow for a degree of flexibility and experimentation to get the most value out of data.

“You have the balancing act between wanting to do things on an enterprise basis where you’ve rationalized and established cost efficiency, but keeping things so that it's still fairly nimble and easy to access,” Jeffreys explains. “It’s important for large corporations like ours to find the most optimal balancing point where you can still be nimble since there’s a lot of value in being able to do a little bit of experimentation with data.”

Putting data analytics to use
Ultimately, the stronger, more cohesive data Wells Fargo is working to achieve serves multiple purposes and goes across fraud prevention efforts as well as compliance, particularly regulatory reporting.

“We’re doing a tremendous amount of technology work around fraud and risk management in general,” Jeffreys says. “In many ways data management can really fuel both efforts – the better data you have, the better you can connect it, the better you can detect fraud patterns and the better you can measure risk and support compliance reporting.”

One of the most important applications is the strong link between data management and fraud prevention efforts. “You can't overstate the importance of good data and good data analytics related to controlling fraud,” Jeffreys admits. “From a technology standpoint, it’s vital to have advanced pattern detection that can sort through the large volumes of data and find the proverbial needle in the haystack with a low false positive rate.”

With fraudsters continually testing new techniques and modes of attack, strong data models are necessary to detect fraud patterns and trends, and to help operate in a predictive mode rather than a reactive mode. Currently, Jeffreys’ group is employing rules-based and more neural-network-based analysis around fraud pattern detection, and is also working on developing new algorithms to improve their defense against fraud.

Not only is data analytics a big part of fraud detection, but a strong data analytics practice is also crucial for compliance and regulatory reporting. Basel II and the Bank Secrecy Act are two big frameworks driving initiatives to garner richer information around risk calculations.

Basel II has especially played a big part in driving quantitative risk measurement and cohesion across the business lines. “Because of Basel II, there has been many efforts focused on calculations around measuring risk exposures and doing data on a very consistent basis across our 84 business lines and being able to have a common yardstick of doing things across all our business lines,” Jeffreys says.

While data analytics is crucial for key business requirements such as anti-fraud efforts and compliance, the overall role of data management serves as an invaluable and intrinsic part of the larger business strategy.

At Wells Fargo, the value of strong data analytics is clearly recognized, and is utilized as a critical business tool as well as a competitive advantage across the business. “We are expecting data management to play a critical role in the success of the company and riding through the economic times,” Jeffreys says. “Strong data analytic capabilities can drive revenue, help to improve the customer experience, and is a large factor in expense control and risk management. Our challenge is to continue our efforts to make analytic data very well connected and accessible to the business people who can turn this into an advantage.”

About Mike Jeffreys
Mike Jeffreys is SVP and CTO with Wells Fargo’s Technology Information Group. He manages enterprise data services and information management areas which includes both operational and analytic data.  He is responsible for the company’s Customer Information System, Enterprise Data Warehouse, and Database Management Services. Previous responsibilities have included leadership of the central project management office, management of application development for enterprise risk systems, and technology management involved with mergers and acquisitions. Mike has 25 years of experience with technology in banking.

About the company
Wells Fargo & Company is a diversified financial services company with $595 billion in assets, providing banking, insurance, investments, mortgage and consumer finance through almost 6,000 stores and the internet (wellsfargo.com) across North America and internationally. Wells Fargo Bank, N.A. is the only bank in the U.S., and one of only two banks worldwide, to have the highest possible credit rating from both Moody's Investors Service, “Aaa,” and Standard & Poor's Ratings Services, “AAA.”