visualizing private banking strategies and business models EPFL, Friday, November 24 2006

what is private banking?

private banking is the activity of managing a private client's money. This term is sometimes opposed to retail banking and corporate banking. a private bank is a bank which offers private banking services. Such banks would not, for example, do mortgage business, merger and acquisitions or have checking accounts. They specialize in clients with large accounts (minimum balance varies). the expression private banker usually refers to a professional working in the private banking industry. a mini definition

private banking is the activity of managing a private client's money. This term is sometimes opposed to retail banking and corporate banking.

a private bank is a bank which offers private banking services. Such banks would not, for example, do mortgage business, merger and acquisitions or have checking accounts. They specialize in clients with large accounts (minimum balance varies).

the expression private banker usually refers to a professional working in the private banking industry.

what is strategy? Walter Berchtold, CEO, Credit Suisse Private Banking

positioning x x x x x x x

power games

emerging process

planning process A B C D1 D2 E

environmental adaptation

mental process ETC. ETC.

our ways of working

visualization and co-creation

what is a business model?

sketching business models VALUE PROPOSITION COST STRUCTURE CUSTOMER RELATIONSHIP TARGET CUSTOMER DISTRIBUTION CHANNEL VALUE CONFIGURATION CORE CAPABILITIES PARTNER NETWORK REVENUE STREAMS INFRASTRUCTURE CUSTOMER OFFER FINANCE a business model describes the value an organization offers to various customers and portrays the capabilities and partners required for creating, marketing, and delivering this value and relationship capital with the goal of generating profitable and sustainable revenue streams

building blocks VALUE PROPOSITION COST STRUCTURE CUSTOMER RELATIONSHIP TARGET CUSTOMER DISTRIBUTION CHANNEL VALUE CONFIGURATION CORE CAPABILITIES PARTNER NETWORK REVENUE STREAMS gives an overall view of a company's bundle of products and services portrays the network of cooperative agreements with other companies describes the channels to communicate and get in touch with customers describes the arrangement of activities and resources explains the relationships a company establishes with its customers sums up the monetary consequences to run a business model describes the revenue streams through which money is earned describes the customers a company wants to offer value to outlines the capabilities required to run a company's business model INFRASTRUCTURE CUSTOMER OFFER FINANCE

break-out session

Group 1 VALUE PROPOSITION TARGET CUSTOMER DISTRIBUTION CHANNEL value proposition 1 value proposition 2 … distribution channel 1 distribution channel 2 … target customer 1 target customer 2 … CUSTOMER OFFER describe how a private bank reaches its customers

Group 2 VALUE PROPOSITION TARGET CUSTOMER CUSTOMER RELATIONSHIP value proposition 1 value proposition 2 … relationship type 1 relationship type 2 … target customer 1 target customer 2 … CUSTOMER OFFER describe the type of relationships a private bank builds

Group 3 VALUE PROPOSITION PARTNER NETWORK CORE CAPABILITIES value proposition 1 value proposition 2 … core capability 1 core capability 2 … partner 1 partner 2 … INFRASTRUCTURE OFFER describe the partners that leverage a private bank’s business model

Group 4 TARGET CUSTOMER REVENUE STREAM revenue stream 1 revenue stream 2 … target customer 1 target customer 2 … FINANCE VALUE PROPOSITION value proposition 1 value proposition 2 … OFFER CUSTOMER describe how a private bank makes money

example of a planning process

planning process A B C D1 D2 E

What are our shareholder expectations for financial performance ? To reach our financial objectives, how do we create value for our customers ? What is our value proposition ? What processes must we excel at to satisfy our customers and our shareholders ? How do we align, develop our organization (HR, IT, Organization) to improve our critical processes ? 4 strategic questions

What are our shareholder expectations for financial performance ?

To reach our financial objectives, how do we create value for our customers ? What is our value proposition ?

What processes must we excel at to satisfy our customers and our shareholders ?

How do we align, develop our organization (HR, IT, Organization) to improve our critical processes ?

visualization and co-creation

a visual strategy (fictive example) Financial Client Internal processes Development an integrated private banking service targeted at the world’s top sports professionals highly performing financial products that are understandable to the layperson a regular segmentation analysis of potential clients a performing IT platform systematic approach to customers vision: we’re recognized by our clients, our people and our competitors through our apprehensive financial products A primary source of growth and a profit centre for the Pictet Group operation of a professional customer research facility project management skills professional ways of working aligned human resources aligned IT aligned organization management of talent low cost/income ratio Grow assets under management (AuM) operation of a process design and management team

a continuous process

reference http://business-model-design.blogspot.com