2007 Banking and Capital Markets Conference Thursday  |  November 1, 2007  |  New York City Best Viewed in Slide Show Form...
Overview <ul><ul><li>Should we pursue development of an enterprise Customer Data Integration (CDI) capability? </li></ul><...
2007 Banking and Capital Markets Conference   |  November 1, 2007  Agenda <ul><ul><li>Importance of CDI </li></ul></ul><ul...
Importance of CDI
Initiative Focus:  Value Levers Revenue Growth Decision Effectiveness Customer Experience Improvement Cost Reduction Value...
Revenue Growth (example) Revenue Growth Increase Market Share Increase Share of Wallet Reduce Turnover Importance of CDI “...
Role of CDI Strategize Collect Compile Collect data on the client throughout the breadth of client interactions.  Identify...
Making Economic Sense of CDI
Selling CDI (within the company organization) Enterprise   Compliance   Transaction  Monitoring Marketing Finance Complian...
A Pragmatic Approach to Building CDI
Building CDI <ul><ul><li>Focused Design </li></ul></ul><ul><ul><li>Evolutionary Development </li></ul></ul>A Pragmatic App...
Focused Design Compliance Transaction  Monitoring Marketing Finance Risk  Management Customer  Service Sales Tax A Pragmat...
Evolutionary Development A Pragmatic Approach to Building CDI Single Point of Entry Single View  (real time) Golden Source...
Overview <ul><ul><li>Should we pursue development of an enterprise Customer Data Integration (CDI) capability? </li></ul><...
<ul><ul><li>John Haley, Managing Principal Haley Consulting Group LLC Office: (312) 772-3456 Cell Phone: (312) 961-1691 em...
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Customer Data Integration For Growth in Banking And Capital Markets (download and view in slideshow)

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A presentation on the value of Customer Data Integration, how to sell it internally, and how to think about implementation. Given by John Haley at the Banking and Capital Markets Conference in New York City in November 2007. Best viewed in slide-show format.

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  • Good afternoon everyone. Thank you for taking the time to join us in exploring ways we might better attain profitable growth. The format for today’s discussion will consist of a short presentation followed by Q&amp;A to our esteemed panel We have a lot to discuss today and limited time so I’d like to get started – but before we do let’s share some introductions. CLICK
  • So let’s get started Customer Data Integration (CDI) is the act of collecting and compiling all relevant client data across the enterprise for a “single view” of the client. Having this capability enables more rapid and advanced analyses to drive profitable growth. Profitable growth is more than improved revenue, more than reduced costs, and more than managing risks better. It is all of these and much more. Building a CDI capability is a complex and expensive proposition for most companies. Do so requires 3 questions be answered successfully… Is CDI important to my business? Does achieving CDI make economic sense to my business? Can my business build and maintain CDI?
  • It is around these 3 questions that we have organized our presentation today with the intent of sharing some perspective of how you might go about developing answers appropriate to your organizations.
  • All Banking &amp; Capital Markets companies at all times work across the four Value Levers of Revenue Growth, Cost Reduction, Customer Experience Improvement and Decision Effectiveness, to resolve issues through capabilities that feed Profitable Growth . While the balance of efforts across all four typically changes, the core capabilities that feed excellence across all four are very similar - - - and all 4 rely heavily on client understanding. Let’s examine some of these issues… Revenue Growth Inability to cross-sell / up-sell effectively across the enterprise Marketplace gaps (geography, product, segments, etc) Customer pricing and/or profitability not managed actively and/or holistically Lack of innovative and differentiated value propositions Products fail to meet client needs and wants Decision Effectiveness Inability to compile a single view of the client (aggregate accounts, etc) Inaccurate and fragmented data Lack of coordination/point of control regarding client decisions Misaligned metrics Gaps in understanding of risk Customer Experience Improvement Poor / fragmented client knowledge Customer experience is spotty and not integrated across channels Difficulty of managing relationships via intermediaries Cost Reduction Functional silos within the organization with redundant and/or unintegrated systems Legacy technology / poor technology enablement Cultural impediments to data sharing Sub-optimal distribution network Unintegrated or undifferentiated client servicing Let’s explore one of these value levers to better understand the role of data
  • Revenue Growth opportunities, while often straight forward to develop at the macro level, are almost entirely dependant upon accurate and holistic understanding of the client to be optimally effective at the point of execution. CLICK 3 levers increase revenue (easy) Market share Share of Wallet Reduce Turnover What becomes difficult is understanding the next level questions that must be answered to take big ideas and make them practical realities &lt;&lt;Read example questions&gt;&gt; Ultimate question – cuts across all three ““ Are we optimizing how we go to market across price, promotion, brand, and product/features to ensure greatest, profitable share?” Obviously a fairly sophisticated and intimate understanding of the customer is necessary to answer these questions - - -otherwise execution planning is at best done in a partial vacuum and at worse is supported by guesswork.
  • The reason why the past two slides ended with the need to better understand the client is because in resolving these complex business issues one is forced to follow something akin to a Decision Pyramid. The Decision Pyramid – or something like it in your organization – is what all professional organizations do to solve complex business issues CLICK (stream) COLLECT: Collect data on the client throughout the breadth of client interactions. Identify authoritative systems and gather data. COMPILE: Consolidate data from the breadth of authoritative systems and map them together into one accessible environment. ANALYZE: Understand current and future trends, sensitivities, and profitability. Apply to robust client segments (attitudinal, behavioral, needs based, demographic, etc) STRATEGIZE: Develop fact based options (courses of action). Prioritize against strategic context. Select one for additional development and planning. EXECUTE: Implement the option under a program. Iterate our analyses to confirm/validate supporting data and conclusions (e.g., have things changed?) CLICK Through this model one can easily see CDI’s importance in that it represents the foundation to complex business decisions. In many ways it is the equivalent of “food, water, and shelter” for Maslow’s hierarchy of needs. Certainly one can analyze and strategize without a good understanding of the client, but that is the equivalent on Maslow’s hierarchy of needs of finding love and self actualization without food, water, and shelter. It is a temporary, hollow, and perhaps incomplete achievement
  • So at this point we hopefully can answer the first question: Is CDI important to my business? Next - - we ask the question “ Does achieving CDI make economic sense to my business?”
  • At first glance the economic case for enterprise CDI is a tough one. CLICK If we take a look at Compliance for example we see that CDI has a positive business case. CLICK But Compliance’s business case typically doesn’t correlate to the business case needed to support an enterprise solution. Thus (as is often the case) Compliance builds a chewing gum and paper clip CDI solution that isn’t shared and is sub optimal. This is a common issue – that individually, separate elements of the Banking &amp; Capital Markets organization benefit from CDI but individually cannot justify the benefits case that supports an enterprise solution. CLICK The irony is that if one steps back from the individual function seeking CDI and looked across the enterprise we actually find MANY organizational elements that would benefit from CDI. We also find many of these groups are independently building their own CDI solution - and again with limited budgets, in typically an unshared and sub optimal architecture So the takeaway is that the business case for enterprise CDI MAY be justified but often only if one looks at the solution as one shared across multiple business functions or units (view it across the enterprise).
  • So at this point we hopefully can answer the first two questions: “ Is CDI important to my business?” “ Does achieving CDI make economic sense to my business?” But even if my organization sees the importance of CDI and can justify it economically do we have the business maturity and culture to take on such a complex endeavor “ Can my business build and maintain CDI?”
  • Our experience is that the typical CDI initiative fails during implementation and within that it fails for two reasons: 1) The CDI initiative tries to meet too many business requirements too quickly and at once 2) The CDI initiative collapses under the weight of its size – because the average employee cannot get their arms around the size of the change effort. They get lost in the size of the effort and the length of the journey We recommend two refinements to implementation that mitigate these issues: Focused Design Evolutionary Development
  • To understand the issue addressed by the application of Focused Design lets use the CDI functional model again. In reality the business requirements of these functions for CDI don’t look the same. While very similar - - with probably 80% overlap – the reality is they all look a little different CLICK This incremental 20% or so of business ‘exceptions’ across multiple functions participating in the design of a new enterprise CDI capability is a huge addition in complexity and should be avoided entirely. Trying to please all function’s in Version 1.0, before the foundation of a CDI capability is even created, will often cause the initiative to fail. CLICK Instead the CDI program should design to one function initially (i.e., conduct Focused Design) but with an additional design requirement for future flexibility and scalability. Version 1.0 will thus only fully meet the business requirements of only one function – but other functions will still find significant benefit from the CDI capability because much of their requirements are met by this first version. From their perspective it’s not perfect but it is still useful. Following Version 1.0 the organization can roll out version 2.0, 3.0, 4.0 etc to exactly meet the needs of the other functions. Since the foundation of a capability will have already been established this is a much easier exercise than the initiative to build CDI in the first place.
  • Date The next area we see implementation of CDI fail is when it collapses due to the sheer size of the endeavor. If one were to view the vision of a company’s CDI capability it could be pretty intimidating and hard to conceptualize. But if one considers the path to that vision in terms of an evolution it’s much less difficult to understand. The recommendation here is to realize that CDI is actually a mosaic and it can be built using finite pieces of a mosaic. Another way I’ve heard this approach described is “Eat the elephant one bite at a time” Process looks like this CLICK 1) Define the Vision (benefits, day in the life, etc) CLICK - CLICK - CLICK - CLICK - CLICK - CLICK - CLICK - 2) Describe the journey but do so in pieces Pieces of the mosaic Pieces that build upon one another (not thrown away) 3) The pieces you select must have their own set of defined benefits, a finite beginning and end, act as a step toward the next piece of the mosaic (the next level of capability) The Value of this approach is 3 fold 1) Let‘s the everyday employee executing the CDI initiative understand next steps 2) Provides a degree of self funding - - and eliminates benefits case negative surprises at the end (benefits being checked along the way) 3) Build momentum
  • To recap – the purpose of this presentation was not have you walk away with a plan to build CDI. Rather we hoped to provide you with the key questions you might ask your organizational colleagues to see of pursuing an enterprise CDI initiative makes sense. And with those questions we have attempted to share our perspective on how they might be answered - perhaps with the effect of helping some of you get to “YES”. At this time I’d like to open the floor to questions for our panelists but before I open to the audience I’d like to start things off…..
  • Customer Data Integration For Growth in Banking And Capital Markets (download and view in slideshow)

    1. 1. 2007 Banking and Capital Markets Conference Thursday | November 1, 2007 | New York City Best Viewed in Slide Show Format View Notes Pages for script
    2. 2. Overview <ul><ul><li>Should we pursue development of an enterprise Customer Data Integration (CDI) capability? </li></ul></ul><ul><ul><li>Is CDI important to my business? </li></ul></ul><ul><ul><li>Does achieving CDI make economic sense to my business? </li></ul></ul><ul><ul><li>Can my business build and maintain CDI? </li></ul></ul>
    3. 3. 2007 Banking and Capital Markets Conference | November 1, 2007 Agenda <ul><ul><li>Importance of CDI </li></ul></ul><ul><ul><li>Making Economic Sense of CDI </li></ul></ul><ul><ul><li>A Pragmatic Approach to Building CDI </li></ul></ul>
    4. 4. Importance of CDI
    5. 5. Initiative Focus: Value Levers Revenue Growth Decision Effectiveness Customer Experience Improvement Cost Reduction Value Levers Importance of CDI
    6. 6. Revenue Growth (example) Revenue Growth Increase Market Share Increase Share of Wallet Reduce Turnover Importance of CDI “ How can we regain clients that have left us?” “ Which of our markets are we under-serving?” “ How can we leverage our existing client base to understand how to penetrate other markets?” “ What products/features do my clients need that we are not providing?” “ Around what value propositions are my target segments most sensitive?” “ What new products/features should I be developing that meet my clients’ current and future needs?” “ Which client segments are most susceptible to leaving me?” “ What are the top reasons clients leave us? Where are they going?” “ Of my ‘best’ segments what issues drive turnover and how do we perform against those issues?” ILLUSTRATIVE
    7. 7. Role of CDI Strategize Collect Compile Collect data on the client throughout the breadth of client interactions. Identify authoritative systems and gather data. Analyze Execute Consolidate data from the breadth of authoritative systems and map them together into one accessible environment. Understand current and future trends, sensitivities, and profitability. Apply to robust client segments (attitudinal, behavioral, needs based, demographic, etc) Develop fact based options. Prioritize against strategic context. Select one for additional development and planning. Implement the option under a program. Iterate analyses to confirm/validate supporting data and conclusions (e.g., have things changed?) Collect Compile Customer Data Integration Importance of CDI
    8. 8. Making Economic Sense of CDI
    9. 9. Selling CDI (within the company organization) Enterprise Compliance Transaction Monitoring Marketing Finance Compliance Risk Management Customer Service Sales Tax Making Economic Sense of CDI Benefit Cost ILLUSTRATIVE
    10. 10. A Pragmatic Approach to Building CDI
    11. 11. Building CDI <ul><ul><li>Focused Design </li></ul></ul><ul><ul><li>Evolutionary Development </li></ul></ul>A Pragmatic Approach to Building CDI
    12. 12. Focused Design Compliance Transaction Monitoring Marketing Finance Risk Management Customer Service Sales Tax A Pragmatic Approach to Building CDI Enterprise Benefit Cost ILLUSTRATIVE
    13. 13. Evolutionary Development A Pragmatic Approach to Building CDI Single Point of Entry Single View (real time) Golden Source (thick) Golden Source (thin) Single Client ID Disparate Account Level Data Enterprise Customer Data Integration Single View of the Customer Manual/ Batch Automated/ Real Time Efficiency & Efficacy Low High ILLUSTRATIVE
    14. 14. Overview <ul><ul><li>Should we pursue development of an enterprise Customer Data Integration (CDI) capability? </li></ul></ul><ul><ul><li>Is CDI important to my business? </li></ul></ul><ul><ul><li>Does achieving CDI make economic sense to my business? </li></ul></ul><ul><ul><li>Can my business build and maintain CDI? </li></ul></ul>
    15. 15. <ul><ul><li>John Haley, Managing Principal Haley Consulting Group LLC Office: (312) 772-3456 Cell Phone: (312) 961-1691 email: [email_address] </li></ul></ul>

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