Enhancing Service Quality with Next Generation Business Automation in Banking

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1 Enhancing Service Quality with Next Generation Business Automation in Banking Harpreet Dhariwal, Advisory IT Specialist, Information Management Software, IBM India/SA

2 Issues Forcing Change and Innovation in Banking Organic Growth Cross-sell leveraging a complete understanding of the consumer Use information beyond simple capture and business processing Reducing attrition Faster new product development Increasing wallet share Responding to Customers Requirements Consistently high quality consumer experience across all touch points Build relationships not transactions Security & Regulatory Compliance Need for consistency and standards Improved view degree data and content, credit relationships Authentication, Theft and Fraud 2 2

3 Business Priorities Have Changed Improving business processes has been the #1 priority since Gartner started asking CIOs in Gartner CIO Agenda: 1. Improving business processes 2. Reducing enterprise costs 3. Improving workforce effectiveness 4. Attracting/retaining new customers 5. Increasing use of information/analytics 6. Creating new products/services (innovation) Source: Gartner, Meeting the Challenge: The 2009 CIO Agenda 3

4 Traditional View of ECM Scan Store Retrieve Source: Gartner, Meeting the Challenge: The 2009 CIO Agenda 4

5 IBM s View of ECM Source: Gartner, Meeting the Challenge: The 2009 CIO Agenda 5

6 Where Can You Benefit From ECM? High-volume transactions involving paper or electronic documents Transactions requiring aggregation of multiple or complex set of paper or electronic documents How & where do you store critical corporate documents? Do you have agreements for off-site storage and retention of documents? What are your current records management practices? Document-intensive collaborative projects How are policies and procedures created and disseminated internally? Do you have industry, regulatory or environmental compliance/reporting requirements Highlights Improved decision making Reduced costs Increased flexibility/agility Shortened time to value Improved collaboration between IT and business

7 Emerging ECM Application Solutions New account enrollment Case management Credit granting Customer communications 7 7

8 IBM ECM and BPM Adds Significant Value BEFORE AFTER Inefficient processes: Red - Requires human intervention Yellow - Wait Time Efficient processes: Blue - Semi-automated activity Green - Fully automated activity Example of ABC Organization s Goals Increase profit margins by 7% Improve customer retention by 4% Grow market share in Asia to 18% Innovate new service models Drive common processes and standards 8

9 ECM Deployments Transitioning From LOB To Enterprise Proven Solutions & Value Emerging Solutions & Consolidation Signature Cards Check Image Statement Presentment Account Origination Mortgage Loan Processing Consumer Lending Commercial Lending Credit Card Processing Trust Administration Wealth Management e Mail Mgmt & Compliance Records Management Market Maturity New Account Enrollment Credit Approval Case Management Exception Processing Compliance Rules Library Green Banking Master Content Management Electronic Safe Deposit Supply Chain Finance 9 9

10 IBM ECM Banking Scenarios Function Customer Onboarding Loan / Mortgage Processing Exception Processing Single View of Customer Business Activities Applicable IBM Product Capabilities New Customer Add Product Request Credit Card KYC Checks Credit Exceptions Approval Online Forms Case Management Business Intelligence Records Management Underwriting Approvals Awaiting Documentation Generating Correspondence Case Management Office Integration Document Capture Marginal Credit Rating Fraud Checking Case Management Rules Integration Office Integration New Customer Change of Address Change of Name Add new product Customer Correspondence Historical Case view Case Management Content Search Meta data indexing IBM Enterprise Content Management and Business Process Management Platform

11 IBM ECM Banking Scenarios Function Customer Service Credit Card Loss Business Activities Rapidly find Customer Information Meet Service Levels Keep customer informed Give a choice of channels Notification of Loss Fraud Assessment Refunds Service Levels Interaction with External Agencies (Police etc.) Applicable IBM Product Capabilities Online Forms Document Scanning Business Process Timers Content Taxonomy Integration with messaging systems Online Forms Case Management Scanning / Management Integration with Payment Systems IBM Enterprise Content Management and Business Process Management Platform

12 Making the ECM Connection Which helps the organisation achieve higher level goals Improve customer loyalty Increase agility Expand market leadership Improve competitiveness Prove & maintain compliance Improve operating margins Which removes the barriers to solving operational challenges Improve customer service Simplify operations Management metrics Raise productivity Ensure compliance Decrease costs ECM solves content and process problems Track documents and cases Automate manual processes Streamline workflow Enforce compliance policies Access real time reports Reduce errors

13 Service based Operating Model - Retail Tel Branch Internet SMS Post FAX MULTI CHANNEL Initiate ATM Authenticate Who are you? Common model for: Retail Wholesale Insurance HR, Finance Etc Instruction Perfection Instruction Deep Profile Instruction Service Menu Instruction Inst Cross Sell How Fulfill? Result Customer Interaction History Key Messages Case Tracking Notification / Output Patterns & Events Party Backbone Assess Request Interact Leads MULTI CHANNEL Who is the customer? Update CIH Manage case Key Messages Handover Fulfil Mortgage Mortgage Sales The Basket (n) Acct Notification / Output Adjust / Add Savings Insurance Cross Sell Common Fulfilment Result KYC: Who are you for real? Needs Assessment Sales / Service Request Fulfilment End to end process

14 Service Operating Model Current Issues Initiate Sales Service There is no commonality across interactive and other channels Interact Unstructured information is not stored and managed consistently Where handover paper based not visible or auditable Information in silos and cannot be easily leveraged across front and back processes No single support view of end-to-end customer interaction (case) and across multiple dialogues Fulfil Sales / Service Request Fulfilment

15 Service Operating Model Future model Case Control Monitor Initiate Service Common Content Repository Process is consistent through all channels Interact Documents are available to all processes increasing visibility and providing context Any content can be automatically declared as record to ensure compliance Coordination across processes done at the case level, and can link disparate systems Case management provides full auditability and end-to-end MI information Multi-channel interactions have access to complete customer history & documents Fulfil

16 Benefits examples Organisation Business Area Benefits Bank A Credit Cards Customer Service, Fraud, Authorisations 27% Overall increase in productivity. Reduced training ramp up time by 6 months Insurance A Claims Processing Admin per claim reduced by 11%. 8% increase in claim volume with no increase in personnel Bank B Retail and Corporate Banking Productivity increased by 87%. Decision cycle time reduced from 1 week to 7 minutes Bank C Wealth Management Services Customer service productivity increased. Request latency reduced from3 days to 1 day Bank D Customer Loan, Corporate Loan, F/X service Deposit service, Distribution support service Property Management $118m annually by centralising processing functions and changing sales/fulfilment ratio from 30/70 to 70/30

17 North Shore Credit Union Realizes Significant Savings Business Challenge Streamline business processes so existing staff could manage the increased workload while strengthening customer service. What s Smart? Credit Union staff can leverage all forms of information for a complete view of the customer, streamline business processes, and capture documents electronically for easy access and storage. Smarter Business Outcome $100,000 CAD annual savings due to improved business processes 70% reduction in deficiencies in customer-facing processes With IBM ECM, we ve streamlined and optimized business processes to drive a recurring savings of more than $100,000 annually. Fred Cook Chief Technology Officer North Shore Credit Union

18 Woori Bank Productivity & Service Delivered Productivity Relentless quest for competitive advantage Work smarter, faster, and cheaper Reduce operating costs and cost per transaction Drive results to the bottom line Service Be agile and responsive to customer and market demands Ensure continued customer satisfaction and loyalty Turn issues into opportunities Grow revenue and top-line performance Automated and streamlined core business processes in over 655 branch locations Reduced loan processing cycle times from 7 days to just 3 $18 million ROI resulting from process optimization and headcount reduction Additional $23 million ROI resulting from faster time-tomarket And, $115 million ROI resulting from increased sales focus Prior to implementing the solution, our branch office staff spent only 30 percent of their time on customer facing activities such as sales and customer service. Today, they are spending as much as 70 percent of their time on similar activities As we are now more focused on our customers, we are able to react much faster to changing market needs. 18

19 Cost-Driven Hub/Spoke Model Challenge Optimize operational efficiencies and control across Singapore to Malaysia hubbing Filing, Storage and Retrieval manual process Reduce risk around document misfiling, loss, or disaster Solution Uses IBM ECM across 1200 users to hub trade finance, cards, and account services processes IBM FileNet P8 BPM, IM, BPF Enterprise License for 10,000 Users Business Benefits Realized a staff cost savings of $2.3 million Reduced Business Process Cycle Times from 3 days to 4 hours Effective Team Collaboration & Communication. Improved staff engagement and productivity Realized $650,000 savings associated to cost avoidance from using fax/courier 19 19

20 Compliance Driven Challenge ECM Center of Excellence Rollout Manager and Records Manager for global archiving & retention management Build shared ECM platform to host multiple projects (as a service) Solutions IBM FileNet P8, BPM/BAM Records Management Manager Document Management WPS for SOA Business Benefits Improved Legal & Compliance Management business processes SOA Shared Services platform to drive down cost through reusability Drive standards and better adherence to corporate policies FileNet has proved to be the right decision for today s business challenges. Raphael Lamskemper Zurich Service GmbH 20 20

21 Compliance Driven Challenge One Bank strategy to better serve clients Legal & Compliance was consolidated under one General Counsel IT moved to a Shared Services model Solution IBM FileNet P8 as ECM platform for HR e- Files, Accounts, Legal, SAP Matter Management for Legal MS Word and Exchange integration BPM for Client ID related work processes Business Benefits Improved Legal & Compliance Management business processes SOA Shared Services platform to drive down cost through reusability Drive standards and better adherence to corporate policies Shared Services platform for Personnel, Accounting and Legal content 21 21

22 1,350 Institutions World Wide - With More Than 70% of The Top 100 Global Banks Traditional ECM Solutions - Proven Value Account Origination Lending: Mortgage Consumer Commercial Credit Card Trust Administration Compliance Records Management Management Wealth Management Continued Strong Demand 22 22

23 Next Steps Consider Are you fully managing and leveraging your unstructured content? Are your key Case Management oriented business processes as efficient as possible? Are you meeting your compliance and legal discovery challenges? If not let IBM ECM see if we can help. We have a full range of business needs assessments, including rigorous ROI development capacity Stand-alone assessment or as part of/in conjunction with Information Agenda BVAs 23

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