How Banks Can Use Performance Data to Make Smarter Decisions
Banks have access to a plethora of data, but many aren’t fully using it to their advantage. In particular, benchmarking data can be so much more than just a reporting tool—it can help leaders make strategic decisions. When used well, benchmarking helps banks and credit unions gain a clearer view of where they stand, what’s possible, and how to move forward.
But first, what exactly is benchmarking? Benchmarking takes performance data—on products, operations, customer behavior, and more—and compares it to similar institutions. That comparison creates context. It helps leaders validate strengths, identify underperformance, and separate opinion from reality. But more than that, benchmarking supports smarter decision-making across the organization.
Turning Data Into Strategic Insight
The value of benchmarking lies in its flexibility. Institutions can benchmark at a high level—looking at efficiency ratios, growth rates, or digital adoption—or go deep into a specific product, business line, or branch. For example, focusing on the first 90 days of a new customer’s relationship can reveal opportunities to improve onboarding and cross-sell. Zooming in by product, channel, or customer type adds even more precision.
Benchmarking can also bring clarity to internal conversations. If there’s a belief that performance is lagging, outside data can either confirm the concern or offer reassurance. Likewise, when performance looks strong, it can show whether that strength is a true competitive edge—or just on par with the market.
In short, benchmarking adds context that internal data alone can’t provide.
Seeing Around Corners
Beyond current performance, benchmarking also helps banks spot early signs of change—whether in customer behavior, risk exposure, or operational efficiency.
On the growth side, tracking trends across the industry—such as rising mobile adoption or shifting preferences in lending—can guide product strategy and resource planning. Benchmarking helps banks move from reacting to anticipating.
The Role of Customer Experience Data
While many benchmarks focus on financials, they don’t always capture the full picture. For example, if a branch or digital channel is underperforming, the data might point to a volume or conversion issue—but not explain why it’s happening.
That’s where customer experience data becomes critical.
CSP helps financial institutions layer in direct customer feedback to add meaning to benchmark results. If product uptake is low during onboarding, CSP’s insights can help pinpoint whether customers are confused, underserved, or frustrated. If digital self-service usage is flat, customer sentiment may reveal friction points that performance data alone can’t show.
When paired with benchmarking, CX data becomes a powerful tool for improving both performance and service delivery.
Avoiding Common Pitfalls
To get the most from benchmarking, institutions need to approach it carefully. Common missteps include:
- Choosing the wrong peer group. Benchmarking only works when the comparison is valid. It’s important to select institutions with similar size, markets, and strategy.
- Misinterpreting definitions. Metrics like “account approval” or “application completion” may mean different things depending on the source. Understanding definitions is key to drawing accurate conclusions.
- Relying solely on one type of data. Financial benchmarks are important, but they don’t show how customers experience the bank. Including customer feedback provides a more complete view.
- Using benchmarking as a one-off exercise. Trends emerge over time. Institutions that benchmark regularly gain better visibility into what’s changing—and why.
From Measurement to Action
Benchmarking works best when it’s linked to strategy. That means using the insights to support decisions around operations, staffing, product design, customer engagement, and more. It’s also a way to monitor the impact of changes and stay aligned with evolving goals.
When combined with experience data, benchmarking gives banks a clear advantage: a deeper understanding of performance, informed by both metrics and meaning.
With the right tools—and the right questions—benchmarking becomes more than a comparison. It becomes a way to lead with clarity and act with confidence.
