The use of predictive technologies to help financial institutions provide better services and products to their clients is growing, with the recognition that the outcomes of these technologies are only as good as the data that they are fed with. This is what TIAA, the Teachers Insurance and Annuity Association of America, aims to do with Next Best Action (NBA) and Next Connect, its predictive technologies that allow it to better recommend actions for clients and deliver the right services to the right people. It is for this reason that the retirement fund giant wins the award for most cutting-edge IT initiative at the 2018 AFTAs.
NBA is built on predictive analytics, a propensity model and a proprietary artificial intelligence engine. It uses data points across personal, financial, demographic and behavioral patterns to provide real-time recommendations. Rahul Merchant, senior executive vice president and head of client services and technology at TIAA, says these actions enable clients to better engage with TIAA and navigate options to help meet their financial goals. Recommendations might relate to services such as correcting a bad mailing address or missing web ID, advice or products. The Next Connect application allows TIAA to determine who to reach out to and when. It does this by extracting information about engaged clients and assigns them to one of six segments defined by TIAA. The firm’s goal in this regard is to derive new insights for its clients and ultimately its business.
An important point is that these technologies are built on a foundation of robust client data, according to Merchant. “We know who they are, what information they give us, what products they have and what accounts [they have]. Over time, we accumulate information about each interaction with the client and use it to produce insights to better assist them across all channels,” Merchant explains.
TIAA collects the data using a touchpoint master system that aggregates every client touchpoint with TIAA, be it via web, phone, email or paper. This single source of data is a key input for predictive technologies, Merchant says.Moving forward, TIAA plans to add recommendations for NBA and improve its propensity model. It will also expand its Next Connect user base and gather data based on an increasing number of client interactions. “Ongoing insight and analysis is used to improve client segmentation and outreach recommendations, which are different for each segment. As a result, advisory teams will be able to better identify the right level of service for clients in each segment and provide that service efficiently,” Merchant says.
Bloomberg’s Gerard Francis looks at the challenges that capital markets firms face when trying to incorporate alternative datasets.Subscribe to Weekly Wrap emails