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Building stronger financial institutions through Social Knowledge Networks

Last week the National Bureau of Economic Research (NBER) reported the recession ended in June 2009. But we're not out of the woods yet. NBER cautioned that its assessment does not mean economic conditions have been favorable or that normal activity has resumed.

Rather, we've only begun our road to recovery. For the financial services industry, many organizations are still reluctant to lend, some banks are continuing to fail and consolidate, and consumer confidence remains low. Organizations are striving to do more with less, and increase operational efficiency.

Knowledge management strategies within financial services are focused on eliminating information silos and improving worker productivity. Many organizations that have downsized in the past year have felt the strain of losing employee knowledge, and are now working to improve their means for capturing, retaining, and transferring their intellectual property.

These challenges are leading some financial services organizations to use Social Knowledge Networks (SKNs) as the backbone of their KM strategy. SKNs can help them achieve objectives such as improving knowledge transfer and knowledge retention, increasing productivity, and helping maintain regulatory compliance. And it's the subject of today's installment of our Vertical Views series.

Here's what we've been seeing in the financial services industry, and how they can use Social Knowledge Networks to achieve their business objectives.

Great Repercussions

With customer confidence remaining low, financial services organizations are tasked with restoring their image of trust and stability. They are focused on building their relationships with customers, vendors, and partners, and seeking to improve service levels to increase loyalty and sharpen their competitive edge.

Regulations limiting rate increases and requiring underwriting of businesses threaten to decrease profitability. Many organizations find they need to invest in better analytics to monitor and comply with regulatory requirements.

Financial services organizations continue to face ongoing content management challenges. They are information-centric. They operate with diverse content, and provide their customers with a large selection of financial products and services that require them to manage large product portfolios.

Organizations must also constantly deal with the effects of employee turnover associated with natural attrition, retiring workforces, and mobility. Capturing their collective knowledge before they leave must be an essential part of normal business operations.

Economic conditions have made this an even bigger challenge. Organizations must identify those areas of their business operations where productivity levels need to be increased in order to account for the shortfall in personnel.

The financial services industry is highly competitive and driven by market activity. To be productive and competitive, organizations need a single, consolidated, 360-degree view of information, regardless of its type or form.

They require a robust KM system to manage these vast amounts of data. As 2011 approaches, financial services organizations will look to new markets and technologies to create sustainable differentiation, while managing risk.

How SKNs Let You Do More with Less

Financial services organizations can use Social Knowledge Networks to improve knowledge worker productivity and reduce operating costs through better content management.

SKNs can provide a "single source of truth," an organized and searchable interface to internal and external information, accommodating many disparate types of structured and unstructured content. This includes documents; images; websites; RSS feeds; and social content, such as blogs, wikis, online ratings, discussions, and social tags.

SKNs allows financiers to search for and discover all reports, images, spreadsheets, analyses, and digital files associated with any of their firm's products, past or present. They can monitor trends and economic indicators, and apply that data to their internal information, deriving insights that shape their investment strategies. The refined information and knowledge sharing process can also be used to evaluate the effectiveness of existing products and services to optimize offerings for customers.

Knowledge workers can use the social technology capabilities in SKNs to provide further relevance to their searches, collaborate with one another, or set up RSS alerts and feeds. They can get a global view of their organization and collaborate on new product ideas, all in a highly secure and controlled environment.

Let's look at an example to illustrate this. We'll take real estate and investment deals, which are highly transactional and generate large volumes of content. Documents can be hundreds of pages, and range from leasing and financing origination paperwork to market analysis reports and construction drawings. They're usually stored on isolated hard drives, e-mail folders, or in binders on people's desks.

Direct costs for onsite and offsite document storage can grow rapidly, as well as the administrative costs for filing and photocopying paper. Indirect costs can increase proportionately, from the time it takes to search for a document, to the time wasted working on incorrect versions.

However, a SKN can be used as a central repository to manage all documents associated with acquisition, development, management, and disposition of investments. It provides a single point of access for all users across all offices. This breaks down information silos, and speed information discovery. This in turn increases productivity because workers are spending less time searching for data, and more time using it.

SKNs' social functionality also lets organizations improve the quality and relevancy of their content. Information assets become living, evolving documents that people can comment on, rate, and improve for the community of users. This facilitates knowledge transfer and retention, and preserves a workforce's most valuable asset -- its intellectual property -- for ongoing future use.

Getting the Most Out of Existing Information Architecture Investments

SKNs can span across multiple types of repositories, including SharePoint Sites, to index pertinent content and make it available. We can look at an example in Presto. When a new SharePoint Team Site is created to create a complex proposal or aid in regulatory compliance, the team can search Presto from within SharePoint to retrieve relevant proposals, images, and contracts, all of which are rated so that the best of each float to the top.

SKNs can easily integrate into existing information repositories, including SharePoint and other applications. Teams can create internal, secure knowledge networks around enterprise content, with sophisticated social, search, and security capabilities that complement SharePoint. By augmenting against existing infrastructure, Presto enables organizations to maximize and improve upon SharePoint and other technology investments.

Security and End-User Self Sufficiency Are No Longer Mutually Exclusive

Striking the right balance between access, collaboration, and control of your knowledge repository is now an imperative for the financial services industry. On one hand, you want to foster adoption and encourage collaboration among employees. On the other, you need to ensure information access with security and control so employees work within your organization's processes, policies, and regulatory compliance structure.

SKNs allow an administrator to define user access levels, while still enabling end users to define content permissions, configure screens and home pages, add new types of content, and set up users and roles. This is achieved through the social volume knob function, which lets you "dial up" or "dial down" permission and access rights per user.

This gives you an overview of how financial services can use Social Knowledge Network to address business objectives surrounding productivity, knowledge transfer and retention, organizational effectiveness, and competitiveness. If you have questions about anything you've read here or would just like to chat more, our door's always open.

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