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CRM at ICICI bank

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A report on CRM at ICICI Bank

A report on CRM at ICICI Bank

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    CRM at ICICI bank CRM at ICICI bank Document Transcript

    • OVERVIEW OF BANKING CRM Practices in newgeneration Private Banks: A Case of ICICI Bank Submitted to Prof. Suresh Chandra Bihari IBS Hyderabad 2009 Submitted by Ajeet Kumar Sharma- 08bshyd0042 Anirban Chakrabarti -08bshyd0098 Ankesh Kasat-08bshyd0103 Arpita Tiwari-08bshyd0148 Khushboo Jain– 08bshyd0346 Raghvendra Singh 08bshyd0616 Suvobrata Mukhopadhyay-08bshyd0864 Ajeet Sharma 9/22/2009 Vikas Kukreja- 08bshyd0935 ICFAI BUSINESS SCHOOL, HYDERABAD
    • CONTENTSAcknowledgement ................................................................................................................................... 3CRM in new generation private banks: a case of ICICI Bank ................................................................... 4CRM at ICICI Bank ................................................................................................................................ 5Implementing CRM at ICICI Bank .......................................................................................................... 6Interview with an employee ..................................................................................................................... 8Benchmarks/Results ................................................................................................................................ 9Conclusions ........................................................................................................................................... 10References............................................................................................................................................. 11 Websites/papers ................................................................................................................................. 11 Database............................................................................................................................................ 11 2 | CRM Practices in new generation Private Banks: A Case of ICICI Bank
    • ACKNOWLEDGEMENTThis report is submitted in partial fulfillment of MBA Program of ICFAI Business School. Wewould like to express our sincerest gratitude to Prof Suresh Chandra Bihari for his continuedguidance, encouragement and valued insights that have made this exercise exciting and anextremely useful learning experience. 3 | CRM Practices in new generation Private Banks: A Case of ICICI Bank
    • CRM IN NEW GENERATION PRIVATE BANKS: A CASE OF ICICI BANKIntroductionCRM is an acronym for ‘Customer Relationship Management’. It’s a set of strategies, processes,metrics, organizational culture and technology solutions that enhance an organizations ability tosee the differences in its present & prospective customers, track new opportunities to better servecustomers and act, instantly and profitably, on those differences and opportunities. RecentlyCRM has taken a center stage in the business world with businesses concentrating on savingmoney and increasing profits by redefining internal processes and procedures. It costs acompany dramatically less to retain and grow an existing client, than it does to court new ones.The aim of CRM is to optimize the use of technology and human resources.CRM services consist of the following major segments:  Consulting services  Implementation services  CRM Outsourcing services  Training services 4 | CRM Practices in new generation Private Banks: A Case of ICICI Bank
    • CRM AT ICICI BANKEmphasizing on the importance of CRM one of the ICICI employees said, “With the overallimprovement in the ETL1 process made possible by PowerCenter, we benefited from greater dataimmediacy for business users and more reliable information, which resulted in quicker analysisand timely reporting.”—Gurnam Saini, Assistant General Manager, ICICI BankCRM at ICICI Bank involves increased communication between the bank and its present andprospective customers. Its philosophy focuses on each and every customer’s satisfaction.CRM facilitated coordination of multiple business functions & multiple channel ofcommunication with the customers to carry out customer management more efficiently. It alsoautomated the process flow tracking in the product sales process and helped generate customizedreports and promote cross-selling.The typical components of a CRM strategy at ICICI are as follows: - Understand and differentiate: Understanding customers is important in order to develop a sound relationship with them. Customer profiling is done in order to understand demographics, purchase pattern and channel preference. CRM also helped1 Extraction, Transformation & Loading 5 | CRM Practices in new generation Private Banks: A Case of ICICI Bank
    • ICICI in valuation of its customers to understand customer profitability and Customer Life Time Value (CLV). - Develop and customize: - In a customer centric business environment, the products and processes have to be according to customers’ needs and preferences. ICICI has always focused on developing channels of service delivery according to customers’ need and service expectation. - Interact and Deliver: To foster a strong customer relationship ICICI ensured that all areas of the bank have easy access to relevant, actionable customer information and employees should be trained on how to use customer information to tailor interactions based on both customer needs and potential customer value. - Acquire and Retain: CRM helped ICICI to figure out valuable customers and made it easy to formulate retention strategies for them. It also helped it cope up with the change in customer’s life cycle and offer services accordingly. IMPLEMENTING CRM AT ICICI BANK The key to implementing CRM was in understanding organization and customers in a better way. There are five interrelated areas that were taken care of before implementing CRM: - Business Focus - Organizational Structure - Business Metrics - Marketing Focus and TechnologyBusiness Focus: There are various components of CRM like customer information, sales,marketing trends and marketing efficacy that acted in tandem to improve relationship betweenICICI and its consumers. ICICI captured customer data and analyzed them while dealing withcustomers at these very touch points. A CRM solution from Siebel was implemented for theautomation of customer handling in all key retail products of the Group. The solution allowscustomer service agents to track all customer complaints and requests. It also allows targetsetting and centralized tracking of turnaround times for request fulfillment. The solution wentlive in phases during fiscal 2002. The Bank has also undertaken a retail data warehouse initiativeto achieve customer integration at the back-office. This central view of the total customerrelationship is being used extensively for identifying opportunities to cross-sell new products andservices to the existing customer base.Technology Focus: ICICI Bank continues to leverage ICT2 as a strategic tool for its businessoperations to gain competitive advantage. Its technology strategy emphasizes enhanced level of2 Information and Communication Technology 6 | CRM Practices in new generation Private Banks: A Case of ICICI Bank
    • customer services through 24x7 availability, multi-channel banking and straight throughprocessing, and cost efficiency through optimal use of electronic channels, wider and focusedmarket reach and opportunities for cross-selling. The Technology Management Group (TMG) isthe focal point for the ICICI Group’s technology strategy and Group-wide technology initiatives.This group reports directly to the Managing Director & CEO.A key to ICICI’s success has been its ability to harness business information to CRM initiativesthat have fueled growth and helped attract more than 30 million customers. The foundation forICICI Bank’s wide-ranging CRM programs is a Sybase IQ-based data warehouse. Developershad used a combination of PL/SQL and BTEQ scripting, a proprietary technology specific to thedata warehouse, for data extraction, transformation, and loading (ETL). With its growingcustomer base, IT administrators recognized that the bank needed a more powerful, sophisticateddata integration system to help ensure the warehouse lived up to its potential as an analytic CRMengine that delivered tangible bottom-line results.To step up to the next level of data integration, ICICI Bank officials agreed with arecommendation from Teradata’s professional services division, which provided systemsintegration support for the data warehouse, to implement the Informatica PowerCenterenterprise data integration platform. (The Bank initially used Teradata as its data warehouseplatform and migrated to Sybase IQ a year ago.)ICICI Bank deployed PowerCenter in 2003 as it embarked on the next phase of its warehouse,which would add data from five new sources, in addition to the initial three sources of retailbanking, credit cards, and securities information.The next step in the CRM implementation process was gap analysis which essentially isassessing different loopholes in: - Marketing, sales and service practices - Collection, capture, processing and deployment of customer information - Distribution and operations effectiveness at customer touch points 7 | CRM Practices in new generation Private Banks: A Case of ICICI Bank
    • INTERVIEW WITH AN EMPLOYEESuvobrata: Good evening Ms Priyanka Devedas.Ms Priyanka: Good evening Suvobrata.Suvobrata: Is it the right time to talk? We need your help regarding CRM Processes at ICICI.Ms Priyanka: Sure Suvobrata, Tell me how can I help you?Suvobrata: Can you just brief us regarding CRM process of ICICI bank?Ms Priyanka: CRM at ICICI is an extensive process which involves communication with existingcustomers and prospective customers. There are multiple channels through which we communicatewith customers to carry out customer management process. We use different softwares to carry outthese process.Suvobrata: We have also heard that ICICI Bank is the number one bank in India in customer relationshipmanagement. What is ICICI doing different than other banks?Ms Priyanka: We use latest software to understand our customers, their demographics and needs. Wetry to provide them customized products as per their requirements. You must be aware of differentcredit card schemes provided by us to customers.Suvobrata: CRM is the activity done at various levels of the organization, how does ICICI implement it?Ms Priyanka: Implementation part is done by Top management and I am not aware of the wholeprocess. I can just tell you that “GAP analysis “is done before we embark on CRM implementation.Suvobrata: Thank you very much Ms Devadas.Ms Priyanka: You’re welcome Suvobrata. Feel free to contact if you need further assistance. Have a niceday.Reference:Ms Priyanka Devedas (Wealth Manager-Delhi)Priyanka.devadas@icicibank.comICICI Bank LimitedBooth No. 104-105Faridabad – 121007Mobile-09953001002The ease with which we could approach to this employee itself speaks volumes about the ICICI cultureand its customer centric approach. 8 | CRM Practices in new generation Private Banks: A Case of ICICI Bank
    • BENCHMARKS/RESULTS Time-Norms for Various Banking Transactions S. No. Particulars Time Taken 1 Cash payment Up to 15 minutes 2 Receipt of cash Up to 15 minutes 3 For issuance of demand draft Up to 10 minutes 4 Payment of demand drafts Up to15 minutes 5 Payment of fixed deposit receipts 20 to 25 minutes 6 Opening of an account% 25 to 30 minutes 7 Statement of accounts (request for duplicate) Within 3 working days Collection of cheques 8 - Local Normally within 4 days - Outstation Normally within 21 days Deployment of CRM Best Practices- Private Banks Sr. No Name of Bank Type Mean Std. Dev 1 ICICI Bank NPB 4.45 0.78 2 HDFC Bank NPB 4.41 0.63 3 Kotak Mahindra Bank NPB 4.1 0.86 4 UTI Bank NPB 4.07 0.88 5 IndusInd Bank NPB 3.79 1.11 6 ING Vyasa Bank OPB 3.76 0.64 7 Centurian Bank of Punjab NPB 3.48 1.02 8 Karur Vyasa Bank OPB 3.28 1.14 9 Federal Bank OPB 3.24 1.06 10 Tamil Nadu Mercentile Bank OPB 3.1 1.01 11 Jammu &Kashmir Bank OPB 3.07 1 12 Karnataka Bank OPB 2.97 0.96 13 Development Credit Bank NPB 2.97 0.98 14 South Indian Bank OPB 2.93 0.92 15 Bank of Rajsthan OPB 2.93 0.89 16 Lakshmi Vilas Bank OPB 2.86 0.98 17 City Union Bank OPB 2.79 0.98 18 Dhana Laxmi Bank OPB 2.79 0.86 19 Catholic Syrian Bank OPB 2.55 0.78 Overall Mean 3.34 0.92 33 European Journal of Social Sciences – Volume 11, Number 1 (2009) 9 | CRM Practices in new generation Private Banks: A Case of ICICI Bank
    • In the first table, we can see that the benchmarks set by ICICI are definitely of world class andclearly values customer’s precious time. Similarly, in the second table it’s evident that ICICIBank and HDFC Bank have done very well compared to other banks in terms of CRM bestpractices. Moreover, the standard deviation is also very less compared to most of the other banks.Clearly this has helped ICICI bank acquire a large customer base (about 30 million) in a shortspan of time. CONCLUSIONSThus, we see that a focused and customer centric approach helped ICICI Bank become # 2 bankin India (till recently, as PNB has taken over it as the No 2 bank in India now). ICICI has usedCRM not only as a tool but also as a strategy to gain competitive advantage over other newgeneration private banks. It has invested a lot in ICT and spared no pains in giving best to thecustomers. Its multi-pronged approach towards managing customer relationship is payingdividends constantly and as a result we see millions of happy satisfied customers determined tomake it one of the most successful banks in India. 10 | CRM Practices in new generation Private Banks: A Case of ICICI Bank
    • REFERENCESWebsites/papers 1. ICICI Bank Improves IT Productivity and Systems Performance for Award- Winning Data Warehouse with Informatica Data Integration Platform- 2. CRM Practices at ICICI Bank- http://www.scribd.com/doc/14649491/ICICI-Bank 3. ICICI Bank an Overviewhttp: //www.icicibank.com/pfsuser/aboutus/investorelations/annualreport/pdf/2001- 2002/a_r2k2%2845-68%29.pdf 4. Customer Relationship Management (CRM) Best Practices and Customer Loyalty A Study of Indian Retail Banking Sector- http://www.eurojournals.com/ejss_11_1_06.pdf 5. Boosting Datacenter Availability for Largest Private Bank in India with the Help of Symantec - http://eval.symantec.com/downloads/sus/ICICI_Bank.pdfDatabase 1. Industry Analysis Service - Client Version 2.0 2. Prowess. 3. EBSCO 11 | CRM Practices in new generation Private Banks: A Case of ICICI Bank