George Mehok Discusses Data Mining to Solve Business Puzzles
In its April edition, Mortgage Banking published an article authored by George Mehok, Safeguard’s chief information officer, titled Solving Business Puzzles with Data Mining.
Solving Business Puzzles with Data Mining
By George Mehok
Every piece in a puzzle is an important part of the big picture. Each piece fits in a certain way, and puzzle solvers must apply strategic thinking to make it all come together. Depending on the size and number of pieces, some may start with the edges and work their way toward the middle. Others identify similar pieces and begin working on specific sections of the puzzle. Each person chooses the best method to analyze and solve the puzzle.
The same applies to mining data to support business planning and decision making. Each piece of data that a company collects is a puzzle piece that fits into the big picture. Developing a strategic approach to put it all together is the challenge.
National field service companies working on behalf of the mortgage industry collect billions of points of data in the process of inspecting and maintaining millions of properties in neighborhoods, cities and states across the country.
We collect detailed information about the condition of each vacant and abandoned property, instances of damages and vandalism, and the numbers of vacancies, defaults and foreclosures we encounter in each ZIP code.
Our database tracks the numbers of work orders each vendor completes and each employee processes, and the photos that accompany each order. We track outcomes related to specific procedures, training and other activities. If the information is in our system, we can track it.
And just as the tiny pieces in a jigsaw puzzle form a picture, each piece of data builds a picture that can help improve operational performance and the quality of vendor performance, and support the decision-making process of mortgage servicers regarding their property portfolios.
Improving field performance
Over the past two years, Safeguard Properties has made a significant investment to enhance our data-mining capabilities to create new and improved analytics and reporting mechanisms to improve our own performance and share critical data with our clients. Our goal is to create internal business intelligence strategies and use analytics to predict trends to proactively improve performance and help clients make evidence-based business decisions.
Safeguard’s enterprise data warehouse collects information from all of our systems to provide a timely and accurate view of the work we perform in the field and help us make important resourcing decisions. For example, by evaluating contractor performance and property condition trends, we can more accurately forecast resource levels and types of vendors we will need in particular markets.
Analytics also help Safeguard build stronger relationships with our vendors and a more effective vendor workforce. Scorecards allow us to track and measure the performance of each contractor so that we can address issues such as timeliness, accuracy and other quality indicators.
Safeguard also has developed “dashboards”–easy-to-read charts and graphs–so that our vendor-management team can easily view reporting results to evaluate the performance of individual vendors. When deficiencies are identified, field quality-control representatives work with vendors to improve their performance and outcomes.
Supporting client needs and requirements
Field service companies must maintain scorecards to measure their performance against client service-level agreements. By building analytics to track and monitor performance levels in near real time, we can proactively identify issues and take more immediate corrective actions to minimize property risks and ensure that service levels remain at or above our clients’ standards and requirements.
By evolving analytic capabilities to proactively identify trends, we can also help our clients make more informed decisions about their portfolios of defaulted and foreclosed properties, as well as their property disposition strategies.
For example, we can evaluate crime, vandalism, severe weather and property damage trends in particular areas to help clients predict maintenance costs associated with these issues.
Clients can utilize the data we provide to determine optimal property investments to maximize the return on their real estate-owned (REO) portfolios or to make decisions to donate properties to land banks, community development corporations or other agencies.
We can work with clients to determine alternative securing procedures, changes in inspection frequency or other services that may be needed to comply with investor guidelines.
Planning for the future
Safeguard relies heavily on operational reporting, metrics, analytics and dashboards to make business decisions to improve our financial and operational performance as well. We make information available in our internal systems so that each department and manager can pull the data they need to evaluate employee performance, cost information, profit margins and other results, and take measures to either improve deficiencies or share successes and best practices with other departments.
As more of Safeguard’s field inspectors utilize mobile devices, we are in the process of comparing results of those who use such devices and those who do not to determine whether we find a difference in the quality of work. This will help us evolve our processes to help our inspectors improve the efficiency and quality of their work.
Another strategic initiative for Safeguard is the use of Geographic information systems (GIS) tools and techniques. GIS captures locations to ensure that vendors identify and visit the correct properties. The data, enabled by the use of mobile devices, also collects location-based data that will help us assign work orders more efficiently.
By taking advantage of the information treasures in our data mines, companies like Safeguard can fit billions of pieces of information together to solve their most challenging business puzzles and those of their clients. We haven’t completely solved the puzzle, but we are laying the groundwork to continuously improve our own performance, the performance of our vendors, and help clients make better and more-informed business decisions as well.
George Mehok is chief information officer of Valley View, Ohio-based Safeguard Properties, the nation’s largest mortgage field service company. He can be reached at firstname.lastname@example.org.
To view the article in PDF, please click here.
Safeguard Properties is the largest mortgage field services company in the U.S. Founded in 1990 by Robert Klein and based in Valley View, Ohio, the company inspects and maintains defaulted and foreclosed properties for mortgage servicers, lenders, and other financial institutions. Safeguard employs approximately 1,700 people, in addition to a network of thousands of contractors nationally. Website: www.safeguardproperties.com.