Delivering the Future of Banking Today

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Banks must seek new competitive advantages in response to changes in customer
trust, demographics, and demands as well as profit margins reduced by higher
capital requirements, compliance costs, and lower fee income.
While most banks have made customer-centricity one of their highest priorities, the recent global
financial crisis has led to an erosion of customer loyalty. Meanwhile, banks find that distribution
through branch networks and the Internet are inadequate for satisfying demands among younger
customers for service “right here, right now.”
An evolving market brings additional challenges such as higher costs of capital and funding. As
investors and banks increasingly share risk, banks face greater government supervision of the
industry, new requirements for capital coverage, and higher compliance costs. Greater
transparency in pricing has caused, especially in the retail markets, a reduction in (or even the
elimination of) fees, which is further eroding margins.
As customers demand real-time, multichannel, and mobile transactions, it has become clear that
customer-centricity requires changes in business and operating models to rebuild margins and
maintain customer loyalty. To attract everyday customers, banks need real-time processes that are
accessible via all channels (including mobile and tablet devices) to deliver relevant up-to-theminute
analysis whenever they are needed.

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Delivering the Future of Banking Today

  1. 1. Industry Executive Overview SAP for Retail and Commercial Banking Delivering the Future of Banking Today Executive Summary SAP Solutions SAP Innovations References Contact Us © 2013 SAP AG
  2. 2. © 2013 SAP AG2 / 44 Delivering the Future of Banking Today Banks must seek new competitive advantages in response to changes in customer trust, demographics, and demands as well as profit margins reduced by higher capital requirements, compliance costs, and lower fee income. While most banks have made customer-centricity one of their highest priorities, the recent global financial crisis has led to an erosion of customer loyalty. Meanwhile, banks find that distribution through branch networks and the Internet are inadequate for satisfying demands among younger customers for service “right here, right now.” An evolving market brings additional challenges such as higher costs of capital and funding. As investors and banks increasingly share risk, banks face greater government supervision of the industry, new requirements for capital coverage, and higher compliance costs. Greater transparency in pricing has caused, especially in the retail markets, a reduction in (or even the elimination of) fees, which is further eroding margins. As customers demand real-time, multichannel, and mobile transactions, it has become clear that customer-centricity requires changes in business and operating models to rebuild margins and maintain customer loyalty. To attract everyday customers, banks need real-time processes that are accessible via all channels (including mobile and tablet devices) to deliver relevant up-to-the- minute analysis whenever they are needed. Executive Summary SAP Solutions SAP Innovations References Contact Us Delivering the Future of Banking Today Market Situation Transformation Through Technology Innovation Business Priorities SAP Innovations
  3. 3. © 2013 SAP AG3 / 44 Exceed today’s customer expectations. Immediate processing Real-time banking provides immediate responses to customer requests. Enhanced visibility Employees get 360-degree visibility into transactions, their customers, or risk. Increased Agility Banks must react quickly and flexibly to new market, product, and regulatory requirements. Real-time processing gives banks greater transparency and agility in areas such as risk, finance, and sales to help them respond appropriately in the moment. Embracing “Real” Real-Time Banking Real-time processing gives banks greater transparency and agility in areas such as risk, finance, and sales to help them respond appropriately in the moment. Best-Run Retail and Commercial Banking Executive Summary SAP Solutions SAP Innovations References Contact Us Delivering the Future of Banking Today Market Situation Transformation Through Technology Innovation Business Priorities SAP Innovations
  4. 4. © 2013 SAP AG4 / 44 The best-run banks meet customer and market demands by flexibly and rapidly responding to customer needs through multiple channels and industrializing their offerings through efficient manufacturing to support new distribution capabilities. Best-Run Banking Priorities Understanding the value drivers for each of these priorities is key to becoming a best-run financial-services company.  Retail Banking Operations  Commercial Banking Operations  Risk and Compliance  Sales and Service  Multichannel  Finance  People and Talent  Procurement  IT Management  Technology Solutions Executive Summary SAP Solutions SAP Innovations References Contact Us Delivering the Future of Banking Today Market Situation Transformation Through Technology Innovation Business Priorities SAP Innovations
  5. 5. © 2013 SAP AG5 / 44 Executive Summary SAP Solutions SAP Innovations References Contact Us Delivering the Future of Banking Today Market Situation Transformation Through Technology Innovation Business Priorities SAP Innovations For over 40 years, SAP’s innovations have helped companies transform and achieve the goals they never thought possible – making more informed decisions and innovating to lead in new markets. SAP enables the real-time enterprise, empowers new experiences, and unwires the business. Enable the Real-Time Enterprise SAP’s integrated, real-time analytical, predictive, and in-memory database solutions improve the business value of your information and optimize business outcomes. Empower New Experiences The SAP software solutions allow you to deliver simple, elegant, real-time applications rapidly across any device, with the superior consumer-grade experience users have come to expect. Unwire the Business Connect with your customers, partners, and employees efficiently and securely with a market- leading mobile platform and device management technologies from SAP. Business Transformation Through Technology Innovation Revenue growth and profit are no longer sufficient benchmarks for success. In today’s economy, companies need to stand out in crowded and highly competitive markets. The pace of business is relentless, where today’s innovation becomes tomorrow’s status quo. Organizations that embrace technology can transform to gain a significant advantage rapidly over the competition.
  6. 6. © 2013 SAP AG6 / 44 SAP Innovations Banks can use innovations such as in-memory computing, big-data analytics, and cloud-based commerce and business networks consumption to satisfy customers while maintaining control of business risk and profitability. Banks can use mobile technology to expand beyond their branches and reach traditional customers at the local mall or unbanked customers in remote areas. Banks’ business customers want immediate access to payments, reports, and execution on the go – using solutions such as the SAP Financial Services Network, delivered via the cloud. In-memory computing with the SAP HANA platform answers and exceeds needs for real-time operational use of analytical data — such as liquidity risk management and multichannel analysis for real-time offer decisions. This technology revolutionizes the way banks deal with the performance challenges of “Big Data”. The continued drive for efficiency in corporate functions will see cloud deployment models using low-cost and secure platforms for nonstrategic functions (such as HR, payroll, finance, and procurement) while ensuring security and integration simplicity across end-to-end-business processes. Executive Summary SAP Solutions SAP Innovations References Contact Us Delivering the Future of Banking Today Market Situation Transformation Through Technology Innovation Business Priorities SAP Innovations
  7. 7. © 2013 SAP AG7 / 44 Comprehensive solutions for commercial and retail banking. Retail and Commercial Banking Value Map Retail Banking Operations SAP Solutions Commercial Banking Operations Sales and Service Risk and Compliance Multichannel People and Talent Finance IT Management Procurement Technology Solutions Retail Banking Operations Retail Deposits Retail Lending Centralized Payment Processing Finance Finance Transformation Performance Management Finance and Risk Data Management (IFRA) Collaborative Finance Operations People and Talent Core Human Resources and Payroll Talent Management Workforce Planning and Analytics Procurement Supplier Discovery and Lifecycle Management Strategic Sourcing and Contracting Procurement and Order Collaboration Collaborative Invoice to Pay IT Management Application Lifecycle Management IT Infrastructure Management IT Portfolio and Project Management IT Service Management IT Strategy and Governance Multichannel Mobile Customer Internet Banking Call Center Automated Teller Machines Sales and Service Customer Acquisition Customer Management Social Media Engagement Risk and Compliance Credit Risk Management Liquidity Risk Management Governance, Compliance and Surveillance Enterprise Risk Reporting Commercial Banking Operations Cash and Liquidity Management Commercial Lending Leasing Financial Services Network Executive Summary SAP Solutions SAP Innovations References Contact Us Technology Solutions Analytics Consumer ExperienceData Management Enterprise Mobility SAP HANA Platform Application Develop- ment and Integration
  8. 8. © 2013 SAP AG8 / 44 Putting the customer at the core of your business requires a move away from product silos and inaccurate client data. The best-run banks need a 360-degree view of their customers to offer them more relevant products. Retail Banking Operations Responding to new customer demands has traditionally meant adding more IT complexity at an ever-increasing cost, because product and customer systems lacked the flexibility to satisfy these demands. Taking an industrialized, building-block approach toward the manufacture of new products can reduce their time to market. Banks can create their services, product bundles, and offers at low cost and with minimal additional front-end workload – thereby eliminating workaround processes and process breaks. This new manufacturing efficiency also supports agile, customer-centric distribution. It ends the trade-off between efficiency and flexibility to increase revenue while decreasing cost.16% Of companies have a 360 degree view of customers Source: SAP Performance Benchmarking Priorities SAP Solutions Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions Retail Banking Operations
  9. 9. © 2013 SAP AG9 / 44 Benefits  Real-time transparency and issue resolution  Cost reduction via module preintegration  Real-time product and offer creation  Increased productivity via best practices  Multichannel relationship pricing  Proven, scalable support across all layers Retail Banking Operations Reducing operational costs while increasing agility. Drive the lowest unit cost of production and foster agility for mass individualization, ongoing innovation, and improved margins across the customer relationship. Retail Deposits Manage and monitor the entire account contract lifecycle – from transactions and agreements to statements. Retail Lending Accelerate time to market and innovation using simple configuration. Support the full loan lifecycle with efficient workflow and knowledge management to maximize loans supported per employee. Centralized Payment Processing Lower ownership cost by simplifying and centralizing payment processes across business and product lines and opening new revenue streams from value-added services. Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions Retail Banking Operations Priorities SAP Solutions
  10. 10. © 2013 SAP AG10 / 44 The best-run commercial banks aim to be a part of their customers’ financial supply chains, meet new regulations, and enhance service by using scalable, low-cost transaction engines to become more agile. Real-Time Efficiency: Commercial Banks The best-run commercial banks have transformed their business and IT processes to respond immediately to customer requests and integrate with customer financial supply chains. They have reduced costs through process standardization, tailored offers to customer needs, and swiftly responded to new demands and regulatory changes. Operating in real time lets you adjust flexibly to new market requirements. You can give customers 360-degree visibility and direct control of their global cash positions, regardless of time and location. Integration with their business systems fosters end-to-end, straight-through payment processing and reduces costs. New cloud commerce models for corporate connectivity can reduce the cost of on-boarding corporate clients. It can lead to faster time to revenue when acquiring new clients, while lowering transaction costs and increasing customer proximity. 39% Lower compliance and risk management FTEs where a risk management system supports automated reporting and alerting to facilitate risk management Source: SAP Performance Benchmarking Priorities Commercial Banking Operations SAP Solutions Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions
  11. 11. © 2013 SAP AG11 / 44 Benefits  Improved cash flow and liquidity  Real-time product and offer creation  Faster on-boarding of corporate clients  Lower operating and client acquisition fees  Fast reply to regulatory and market changes Real-Time Efficiency: Commercial Banks Greater ability to utilize Big Data to gain insights with a well-established analytics and data-modeling center of excellence Source: SAP Performance Benchmarking The real-time commercial bank – increasing agility while decreasing costs. The best-run commercial banks are essential to their customers’ financial supply chains, reducing their working capital costs through agility and cost efficiency. Cash and Liquidity Management Optimize the use of cash held throughout the corporate relationship. Commercial Lending Accelerate time to market for new product offerings and innovation through simple configuration and flexibility. Leasing Support the full leasing lifecycle for efficient transaction processing. Financial Services Network Build a cloud-based, end-to-end platform for payments, and a services platform that drives low-cost transactions and on-boarding of new corporate clients. 40% Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions Priorities Commercial Banking Operations SAP Solutions
  12. 12. © 2013 SAP AG12 / 44 Regulators are imposing new, complex regulations that require on-demand access to highly granular risk and finance information and drive banks to run stress tests in real time. Enhance Visibility: Risk and Compliance Banks require a centralized risk and finance platform for successful reconciliation of results. On-demand access to huge amounts of highly granular information related to credit, market, operational, or liquidity risk lets banks readily respond to internal stakeholders and regulators, calculate risk, and define and run stress test scenarios. 200 million Cash flow transactions aggregated and presented in less than 3 seconds Source: SAP Performance Benchmarking Priorities Risk & Compliance SAP Solutions Access to real-time information on liquidity cash flows helps banks review various liquidity scenarios, plan for future liquidity needs, and manage performance according to risk- adjusted metrics. Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions
  13. 13. © 2013 SAP AG13 / 44 Benefits  Reduce fraud and operational risk  Monitor, limit, and mitigate risk  Aggregate risk data in real time  Comply with Basel III and Dodd-Frank rules  Run stress-test scenarios in real time  Improve sanction testing Enhance Visibility: Risk and Compliance Integrated, on-demand access to enterprise risk information for enhanced compliance. On-demand access to risk information helps banks answer queries from regulators and internal stakeholders and better mitigate risk. Credit Risk Management Calculate and mitigate credit risk. Liquidity Risk Management Access real-time information on liquidity risk and manage stress-testing. Governance, Compliance, and Surveillance Monitor and track operational risk, sanctions data, and fraud to comply with industry regulations. Enterprise Risk Reporting Report, analyze, and visualize risk information on any device, from anywhere. Executive Summary SAP Solutions SAP Innovations References SAP Solutions Priorities Risk & Compliance SAP Solutions 50-70% Potential improvement of reporting efficiencies by merging internal and external finance and risk reporting Source: SAP Performance Benchmarking
  14. 14. © 2013 SAP AG14 / 44 Empowered customers now demand exceptional service, tailored offers, and more proactive advice. This includes superior service from banks as customers seek to interact anytime, anywhere, and on any device. Sales and Service Banks must be able to offer the right service, at the right time, and at the right price to beat the competition. This requires a continuous focus on customers through superior analytics and the ability to capture and share information across the bank that builds a single source of truth and a true 360-degree customer view. Such information can provide the basis for real-time insight and end-to-end transactions that meet customers’ financial needs. It can also fulfill customers wishes to carry their offices with them, using tablet devices. Subsequent execution and servicing of offers should be seamless, immediate, and highly visible to customers. Errors should be corrected and refinements made in real time or through self-service channels. Consistency is required in originations processes and the servicing of offer lifecycles. 92% Customer satisfaction rate achieved by best-in-class customer service organizations Source: SAP Performance Benchmarking Priorities Sales & Service SAP Solutions Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions
  15. 15. © 2013 SAP AG15 / 44 Benefits  Improve and streamline business processes  Generate flexible products and offers  Manage offers and risk in real time  Generate value from social media  Significantly reduce cost of change  Support consumer and enterprise mobility Sales and Service Higher new product revenue as a percentage of revenue where new product ideas are captured from all stakeholders through multiple channels (including social media) Source: SAP Performance Benchmarking Enabling multichannel distribution that is consistent, proactive, and agile. The best-run banks use SAP software support for sales, service, and marketing for context-sensitive cross-sell and up-sell offers and profitable product and service bundles. Customer Acquisition Anticipate customer needs and provide consistent interaction across channels that are simple, flexible, and easy to use. Customer Management Deliver a real-time, 360-degree view of customer interactions, immediate resolution, visibility, and full support for the offer and product lifecycles – including eligibility and pricing. Social Media Engagement Analyze social media and integrate it into traditional channel services to drive complaint resolution as well as lead generation and management. 24% Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions Priorities Sales & Service SAP Solutions
  16. 16. © 2013 SAP AG16 / 44 Superior customer experience requires state-of-the-art interfaces that are reliable, convenient, and harmonized. Profitable banks control costs for integrating and maintaining channels while creating innovative new offerings. Multichannel Banks can achieve customer satisfaction with convenient, simple, and harmonized transactions. Combining self-service channels and interaction centers facilitates on-demand service requests via phone or e-mail. Banks can use call centers to make new offerings available, set up appointments with relationship managers, or administer a customer satisfaction survey. New, channel-specific services bring value to customers and increase profitability. By maintaining distribution channels separately, banks can readily offer channel-specific features. Decoupling the user interface from business functionality helps banks adopt new technology and create bank-specific interfaces and branding. A central process-orchestration platform can simplify channel integration and reduce integration costs. 96% Higher revenue growth where organizations enable almost all users with mobile CRM Source: SAP Performance Benchmarking Priorities Multichannel SAP Solutions Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions
  17. 17. © 2013 SAP AG17 / 44 Benefits  Accelerated time to market  Access to new markets  New marketing channels  Propensity-based selling  Lower-cost distribution  Higher cross-sell rates Multichannel Higher total revenue from new customers for the top 25% of organizations as compared with average organizations Source: SAP Performance Benchmarking Delivering more value, convenience, and satisfaction through multichannel banking. Multichannel success requires the leveraging of back-end product platforms and the orchestration of sales and service analytics to operationalize execution. Mobile Customer Deliver best-in-class consumer and enterprise functionality that is easy to deploy and accelerates time to value. Internet Banking Build a single software platform to support all digital channels and allow seamless handoffs from unassisted to assisted channels. Call Center Support assisted channels to provide transparency and proactively drive execution and cross-selling. Automated Teller Machines Create services and products for the next generation of kiosk ATMs. 47% Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions Priorities Multichannel SAP Solutions
  18. 18. © 2013 SAP AG18 / 44 More than ever, CFOs must balance sound stewardship with value creation to meet the needs of regulators, shareholders, and internal stakeholders – while streamlining financial operations, reducing costs, and improving financial performance. Finance Retail and commercial banks face several major challenges today. They must transform their operations to meet new regulations, such as the Dodd-Frank Act and Basel III, and manage liquidity in a climate of sustained volatility and tight capital. In addition, they must outperform their financial objectives and create sustainable value for their many stakeholders. 76% Higher margin where a finance system allows for historical and forward-looking views into financial and operational performance Source: SAP Performance Benchmarking Priorities Finance SAP Solutions To stay competitive in an increasingly crowded market, they must also deliver superior products and service to their customers at reduced cost. Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions
  19. 19. © 2013 SAP AG19 / 44 Benefits  Comply with IFRS 9 and Basel III rules  Deliver superior service at reduced cost  Outperform financial objectives  Create sustainable value  Reconcile risk and finance figures  Improve regulator and consumer trust Finance Of company revenue that goes to finance costs among top-quartile performers versus more than 1.2% for the bottom quartile Source: SAP Performance Benchmarking Achieving financial excellence. Build a platform to meet the challenges of the Dodd-Frank Act and Basel III regulations and provide reconciled accounts and real-time financial and risk insight. Finance Transformation Transform finance to provide external and internal stakeholders with the IFRS 9 financial information they need in the right format, at the right time, and at a low cost. Performance Management Consolidate figures, plans, and budget resources, and meet financial metrics that improve profitability and performance. Finance and Risk Data Management (IFRA) Create a single platform to meet the integrated requirements of IFRS 9 and Basel III bank regulations. Collaborative Finance Operations Automate transactional processes for increased efficiency, effectiveness, collaboration, and service with lower cost.0.4% Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions Priorities Finance SAP Solutions
  20. 20. © 2013 SAP AG20 / 44 People and talent are key competitive advantages in today’s fast-changing business environment. Best-run banks achieve profitable growth by leveraging their talent and out-innovating the competition. People and Talent For organizational growth and an agile response to business change, banks must give people the knowledge and technology to facilitate innovation. They must also move into new markets, adapting to local practices and tapping the right local talent. In addition, they must identify and retain new talent acquired through mergers and acquisitions. 32% Less employee turnover by using analysis of workforce data to design, implement, and monitor workforce optimization strategies Source: SAP Performance Benchmarking Priorities People & Talent SAP Solutions Organizations that quickly respond with the right talent in the right places will have a unique advantage in the marketplace. Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions
  21. 21. © 2013 SAP AG21 / 44 Benefits  Reduced employee turnover  Improved employee engagement  Alignment of HR and business strategies  Higher revenue per full-time equivalent  Reduced HR cost per employee  Real-time insight into business needs People and Talent More employees supported per full-time HR employee with automated reporting Source: SAP Performance Benchmarking The new world of work. Enable growth and sustainability by coupling global capabilities, integration, and real-time insight with choice in the way HR processes and services are delivered. Core Human Resources and Payroll Consolidate HR and payroll processes on a common global platform to enhance workforce data and legal compliance. Talent Management Identify and analyze talent gaps and streamline workforce planning for efficient and effective management of workforce demand and supply. Workforce Planning and Analytics Harness the power of Big Data to predict and plan more accurately for employee demands. 24% Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions Priorities People & Talent SAP Solutions
  22. 22. © 2013 SAP AG22 / 44 While companies often focus on revenue, procurement savings can increase profits about five times more than revenue. The key to maximizing these benefits is delivering consistent quality, savings, and compliance over time. Procurement Excellence Procurement leaders set a baseline for success by implementing best practices, excelling in category expertise, and working with key stakeholders on cost control programs. While savings is always a priority, new objectives have emerged as well. Procurement must manage supplier risk and performance, improve process efficiency, drive innovation, and ensure sustainability practices. You need solutions that offer the tools to cut costs and add value while supporting processes such as spend analysis, sourcing, contract management, operational procurement, supplier information management, and risk and performance management. Such solutions are available both on premise and in the cloud. Robust procurement tools, when coupled with an unparalleled collaborative business network, drive real-time insight and efficiency. 60% Improvement in annual average savings resulting from leveraging technology for sourcing and procurement processes Source: SAP Performance Benchmarking Priorities Procurement SAP Solutions Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions
  23. 23. © 2013 SAP AG23 / 44 Benefits  Optimize spend under management  Increase average annual savings  Decrease FTE per billion in spend  Drive innovation with suppliers  Reduce cost and risk with faster turnaround Procurement Excellence Lower (FTE) per billion in spending for companies conducting electronic supplier collaboration on a network Source: SAP Performance Benchmarking Drive sustainable savings while supporting innovation. Ensure best practices in the source-to-pay process, on premise, or in the cloud, while leveraging the power of network collaboration for efficiency and insights. Supplier Discovery and Lifecycle Management Find new suppliers through cloud-based groups such as the Ariba network and manage these relationships more effectively. Strategic Sourcing and Contracting Identify and act on sourcing opportunities and create favorable, low-risk supply contracts. Procurement and Order Collaboration Realize savings with compliant, user-friendly self-service procurement and make transactions more efficient by collaborating on the Ariba network. Collaborative Invoice to Pay Drive invoice automation and exception management with available dynamic discounting on the Ariba network.55% Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions Priorities Procurement SAP Solutions
  24. 24. © 2013 SAP AG24 / 44 Business enterprises should forge a strategic business partnership with their IT organizations by aligning goals. Business-oriented IT management is all about maximizing efficiency and responsiveness by running IT like a business. IT Management: Run IT Like a Business A recent study conducted by Gartner shows that lines of business want to ascertain the value of their IT investments. IT organizations no longer decide alone which IT projects to fund. The challenge is that IT management is often seen as just running the technical landscape. To become more relevant to an enterprise, IT needs to reposition itself to run like a business. SAP offers an integrated portfolio of solutions to do just that. New technologies like mobile, in- memory, and cloud computing generate value to a business in an unprecedented way. However, these new technologies also make IT landscapes more complex, requiring more tools to manage them. By leveraging SAP solutions to follow best practices, CIOs, CEOs, other executives, management, and employees can tap into and help ensure efficiency, continuity, and responsiveness – making IT more strategic to the business. 36% Higher operating margin where organizations use IT to enable strategic and competitive advantages Source: SAP Performance Benchmarking Priorities IT Management SAP Solutions Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions
  25. 25. © 2013 SAP AG25 / 44 Benefits  Better alignment of IT to business strategy  Shorter IT delivery and business cycles  Lower ratio of IT budget: profits/IT upkeep  Reduced system upgrade and operation costs  Lower cost of risk mitigation/revenue loss  Lower downtime of critical business systems IT Management: Run IT Like a Business More projects delivered on or below budget by top IT management performers Source: SAP Performance Benchmarking Evaluate and control risk, help ensure flexibility and scale, control and optimize costs, and maximize strategic value. Ensure business continuity, drive efficiency, increase IT responsiveness to business objectives – with IT management solutions designed for businesses of any size. Application Lifecycle Management Use application lifecycle management best practices, methods, and services based on IT infrastructure library (ITIL). IT Infrastructure Management Monitor all network assets to drive integrated infrastructure and application lifecycle. IT Portfolio and Project Management Align the portfolio and manage projects to drive innovation efficiently. IT Service Management Align service-desk operations with service-level agreements (SLAs), quickly resolve SLA incidents, and adopt ITIL best practices as business goals change. IT Strategy and Governance Track IT costs and risks and map risks and compliance activities to business impact. 1.9x Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions Priorities IT Management SAP Solutions
  26. 26. © 2013 SAP AG26 / 44 Businesses drive transformation through technology innovation. Real-time enterprises improve information value, innovate developer and user experiences, and unwire the business to engage effectively with customers, partners, and employees. Technology Solutions Technology solutions can make the difference between surviving and thriving. As users become savvier, their needs escalate. Increasingly, users expect real-time insights, predictive analysis, and real-time access to applications from the latest mobile devices. They expect seamless integration of these functionalities with their favorite social platforms. At the same time, data volumes are exploding while the window to optimize opportunities is shrinking. Users need access to information available in an entirely new class of real-time applications. Developers need a platform for innovating more rapidly than ever before. Banks today need to empower their workforce with consumer-grade business applications to increase productivity and competitiveness. Banks have an unprecedented opportunity to deliver new levels of customer engagement through innovative consumer-style applications. Priorities Technology Solutions SAP Solutions Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions “Cloud, social networking, mobility and the strategic use of information are the four forces that combine to create a new era of computing and new opportunities for business.” Source: Gartner, “SAP Is Driving Analytics, Cloud and Mobility in the nexus of Forces,” Donald Feinberg, August 24, 2012 4
  27. 27. © 2013 SAP AG27 / 44 Benefits  Quickly build secure mobile applications  Monetize data held in back-end systems  Address market threats and new regulations  Increase employee engagement  Unwire the business to improve engagement  Reduce time to value and speed up innovation Technology Solutions Innovations shaping the future of banking. Free up resources for running the bank, enhance competitiveness, and appeal to a new generation of customers with real-time banking via their preferred channels. Analytics Leverage data with real-time analytics, business intelligence, predictive analysis, and performance and risk management. Data Management Get good information to your enterprise and manage data with scalability, trust, and unmatched performance. Application Develop- ment and Integration Develop applications and innovation rapidly in a mobile, always-on world of collaborative business networks for secure, cloud-scale applications. Enterprise Mobility Unwire employees, customers, and partners with highly-rated mobile solutions. Consumer Experience Use real-time, consumer-grade software to increase productivity and competitiveness. SAP HANA Platform Streamline applications, analytics, planning, and predictive and sentiment analyses. Executive Summary SAP Solutions SAP Innovations References Contact Us SAP Solutions Priorities Technology Solutions SAP Solutions “Through 2015, organizations integrating high-value, diverse, new information types and sources into a coherent information management infrastructure will outperform their industry peers financially by more than 20%.” Source: Gartner, “Hype Cycle for Information Infrastructure, 2012” July 31, 2012, Michael Blechar 20%
  28. 28. © 2013 SAP AG28 / 44 As bank customers increasingly use mobile channels for their transactions, banks must assure a unified and secure customer experience across distribution channels. To serve customers more effectively and present the next best offer, they must improve visibility into customer holdings and transactions. To control risk exposure and meet regulatory requirements, banks need on-demand access to risk data. Bank employees must be empowered with analytics in visual dashboards and reports that are simple to use. They need granular, real-time and predictive updates on risk, finance, operations, and branch information. To provide services at a lower cost that can scale and adapt quickly, banks need innovations such as cloud technology to complement their traditional business systems. For the last 40 years, SAP has led innovation in banking. A new generation of technology helps banks better understand and serve the needs of their customers and ensure that employees have access to the information they need to run their business more effectively. Bank customers want a unified experience across distribution channels plus real-time information on their transactions and balances. They expect banks to have a complete view of their holdings and risk exposure and to use innovative technology for competitive services and protection from fraud. SAP Innovations Applications SAP Innovations SAP HANA Mobile Analytics Cloud Executive Summary SAP Solutions SAP Innovations References Contact Us
  29. 29. © 2013 SAP AG29 / 44 Finance SAP Business Suite on SAP HANA offers a real-time financial close on detailed data. Legal entity and group are stored in the same repository, thus eliminating time-consuming reconciliation of intercompany transactions. SAP Business Suite on SAP HANA provides a revolutionary approach to payables management, optimizing working capital and reducing days payables outstanding. Risk and Compliance Access risk management automates compliance activities and achieves real-time visibility of access risk to reduce risk and adverse compliance events and improve operational efficiency. Process risk management controls monitoring across policies and regulatory requirements using an automated rules framework that enables quick deployment. Sales and Service By exploring the power of new analytical and data mining capabilities such as predictive analytics banks can gain deep insights into their data that cannot be seen easily. Identify clusters of markets, and leverage these insights to optimize targeting. With a 360-degree customer view, banks can grow the business by offering products customers need and convert loyalty into revenue. SAP HANA enables banks to access to customer, risk, finance, and operations data and identify customers and products, analyze risk, and optimize financial accounting. The best-run banks can thus manage Big Data for significant competitive advantage. SAP Business Suite Powered by SAP HANA Executive Summary SAP Solutions SAP Innovations References Contact Us Applications SAP Innovations SAP HANA Mobile Analytics Cloud
  30. 30. © 2013 SAP AG30 / 44 Real-Time Efficiency Reduce risk and increase customer service through real-time analytics on the most granular transactions and risk exposures. Exceeding Customer Expectations Integrate structured and unstructured data from multiple sources inside and outside the company to meet and exceed customer expectations. Enhanced Visibility: Risk and Compliance Enhance visibility with a real-time holistic view of risk and finance that helps you meet new regulatory challenges, protect customers from fraud, improve market segmentation, and offer new services. On-demand access to customer, risk, finance, and operations data helps banks identify customers and products, analyze risk, optimize performance, and limit fraud. With SAP HANA and SAP Sybase IQ server, the best-run banks can manage Big Data for significant competitive advantage. SAP HANA 100 Terabytes of data can be stored in memory by SAP HANA Source: SAP Performance Benchmarking Executive Summary SAP Solutions SAP Innovations References Contact Us Applications SAP Innovations SAP HANA Mobile Analytics Cloud
  31. 31. © 2013 SAP AG31 / 44 Real-Time Efficiency Give customers a secure and complete offering for on-demand, self-service access to payments, purchases, and other remittance transactions. Exceeding Customer Expectations Offer convenient, low-cost channels to customers that allow transactions anytime and anywhere. Enhanced Visibility: Risk and Finance Gain insight into and act on risk exposures and respond immediately to regulator queries while on the go. Providing a complete and secure way to meet the requirements of mobile commerce by introducing a standard and convenient channel for communication and transactions that supports mobile commerce from anywhere at anytime. Mobile Executive Summary SAP Solutions SAP Innovations References Contact Us Applications SAP Innovations SAP HANA Mobile Analytics Cloud 40% Higher employee productivity where mobile access is provided to employees across all levels Source: SAP Performance Benchmarking
  32. 32. © 2013 SAP AG32 / 44 Real-Time Efficiency Gain granular access to transaction-level information, as it happens, to identify new products more quickly, segment customers, and make up-sell offers. Exceeding Customer Expectations Empower thousands of employees with self-service access to information that helps them make better business decisions in managing risk and finance, and serving customers across business channels more effectively. Enhanced Visibility: Risk and Finance Reduce risk and fraud losses by predicting and protecting the bank from fraudulent transactions, bad debts, and risk exposures and provide front-line employees with the customer insight they need to offer better service. Providing intelligent visibility into key performance indicators across business, risk, finance, and customer operations, as well as predictive analytics for fraud reduction and customer insight. Analytics Executive Summary SAP Solutions SAP Innovations References Contact Us Applications SAP Innovations SAP HANA Mobile Analytics Cloud 20% Higher revenue per employee in organizations that are using information to identify strategic and competitive advantage Source: SAP Performance Benchmarking
  33. 33. © 2013 SAP AG33 / 44 Financial Services Network Host on-demand services to facilitate multibank routing, multiformat payments, client on-boarding, and core transaction management between banks, corporations, and treasury-service providers. Talent Management Use cloud services for recruiting, performance management, compensation management, talent assessment, and performance review. Smart Procurement and Commerce Combine industry-leading, cloud-based technology with one of the world’s largest Web-based trading communities. Connect to your trading partners anywhere, at anytime – from any application or device – to buy, sell, and manage their cash more efficiently and effectively than ever. Enable rapid time to value and maximize savings by automating and streamlining the strategic source- to-contract process. The speed and flexibility offered by cloud computing is creating new opportunities for best-run banks. SAP cloud applications and the SAP HANA platform help banks build differentiating solutions, establish nimble global business networks, and connect faster and more directly with customers. Cloud Executive Summary SAP Solutions SAP Innovations References Contact Us Applications SAP Innovations SAP HANA Mobile Analytics Cloud 66% Of companies expect greater flexibility and agility to be a source of business advantage from cloud computing Source: SAP Performance Benchmarking
  34. 34. © 2013 SAP AG34 / 44 All the top 50 retail banks run SAP. Best-Run Customers ING Real Estate Best-Run Customers National Australia Bank Standard Bank Nedbank UniCred Centro Brasiliera Why SAP? Executive Summary SAP Solutions SAP Innovations References Contact Us
  35. 35. © 2013 SAP AG35 / 44 SAP co-innovates through the Banking Industry Architecture Network (BIAN) to build a flexible IT architecture vision with six tier one institutions and in the financial supply chain area to create SAP Financial Services Network with seven tier-one institutions. Customer Co-Innovation SAP and seven leading banks collaborate on developing SAP Financial Services Network – a cloud-based platform that simplifies transactions between corporations and their financial institutions. Executive Summary SAP Solutions SAP Innovations References Contact Us ING Real Estate Best-Run Customers National Australia Bank Standard Bank Nedbank UniCred Centro Brasiliera Why SAP?
  36. 36. © 2013 SAP AG36 / 44 “To exceed client expectations, ING Real Estate Finance needs to excel in execution. Implementing globally consistent, end-to-end processes supported by an up-to-date SAP platform is of strategic importance.” Guus Schnitzler, COO, ING Real Estate Finance ING Real Estate Finance is the commercial real estate lending subsidiary of the ING Group. Responding rapidly to evolving client needs while minimizing risk is essential in real estate markets. With strong executive sponsorship and engagement from internal process experts, ING Real Estate Finance achieved globally consistent processes. ING now has much greater real-time insight and control – key advantages in today’s volatile climate. Key Benefits  Ability to serve all clients and administer all products in 1 integrated system for loans, collaterals, finance, and reporting  Real-time insight in portfolio to better control and steer the business  Clear end-to-end-process and control framework adopted across all countries 99%Of loans with complete collateral information 0%Of loans managed in Microsoft Excel 80%Reduction in time to market for new products Executive Summary SAP Solutions SAP Innovations References Contact Us ING Real Estate Best-Run Customers National Australia Bank Standard Bank Nedbank UniCred Centro Brasiliera Why SAP?
  37. 37. © 2013 SAP AG37 / 44 “Our sales funnels are stronger as result of this activity and lending has improved. Bankers are more focused on clients with opportunities that are true and correct Mary Scoutas, Regional Executive National Bank National Australia Bank (NAB) is an international financial services organization that provides a comprehensive range of financial products and services to over 10 million customers. NAB’s sales performance information was being received from multiple reporting sources, residing in multiple databases and governed by inconsistent business rules. Bankers increasingly need a 360-degree view of sales performance at a local level to support local decision making. SAP provided a corporate bankers dashboard’ for sales reporting, analysis, and number and type of cross-sell leads. Key Benefits  Consistent view of sales performance by individual branch or region  One view of the truth for accurate sales targets, results, and forecasts  Take-up and usage strong with 90% using monthly and 50% weekly 50%Use dashboard weekly Cross-sell rate improved Improved forecast accuracy Executive Summary SAP Solutions SAP Innovations References Contact Us ING Real Estate Best-Run Customers National Australia Bank Standard Bank Nedbank UniCred Centro Brasiliera Why SAP?
  38. 38. © 2013 SAP AG38 / 44 “For the first time, we delivered our three-year plan targets well ahead of the executive session, without our central team having to work overtime to ensure data quality.” Luigi Bianco, Group Finance General Manager, Nedbank Group How does a banking giant take its organization to the next level when relying on stand-alone spreadsheets and manual processes for business planning? Nedbank needed to streamline and harmonize the planning process, implement strategic planning and a rolling three-year plan, improve the accuracy of information and reports, and provide company-wide, simultaneous access to planning models. Nedbank implemented a standard, company-wide approach to strategic planning. Key Benefits  Spend more time on analysis and less on transactional work  Eliminate manual intervention while significantly improving data accuracy  Deploy staff to more value-added activities 30-40% Improvement in data accuracy 15Minutes to create report rather than 24hours 100%Reduction in overtime Executive Summary SAP Solutions SAP Innovations References Contact Us ING Real Estate Best-Run Customers National Australia Bank Standard Bank Nedbank UniCred Centro Brasiliera Why SAP?
  39. 39. © 2013 SAP AG39 / 44 “Sybase Unwired Platform helps us integrate mobile banking apps with our existing SAP software.It provides a stable, scalable solution that will help us grow our core banking business.” Willie Stegmann, Core Banking Transformation Executive, Standard Bank Group Ltd. Standard Bank Group Ltd. is the largest bank in South Africa; the company holds a 25% market share. With a goal of becoming the leading personal and business bank in South Africa by 2015, Standard Bank engaged in a business transformation initiative. One project in the initiative was to develop an inclusive banking program that would provide low-income and poor consumers with access to formal financial services at Standard Bank. Meeting this mission required a highly automated IT solution that could operate at a low cost. Key Benefits  Opened banking to 10 million prospective customers  Trimmed account origination process from 27 minutes to 10 minutes  Removed paper from the process  Decreased cost of acquiring customers 10 Minutes time needed to open a mobile account, down 64% 7,000 New mobile accounts opened daily 100,000 New loans opened monthly in loans centers Executive Summary SAP Solutions SAP Innovations References Contact Us ING Real Estate Best-Run Customers National Australia Bank Standard Bank Nedbank UniCred Centro Brasiliera Why SAP?
  40. 40. © 2013 SAP AG40 / 44 “The SAP for Banking solutions enable more transparent processes within the union and toward members. They support higher productivity with a level of excellence equivalent to that of other financial services institutions.” Dr. Clidenor Gomes Filho, President, Unicred Centro Brasileira With over 17 years in the Brazilian market and more than 8,000 members, Unicred Centro Brasileira is a credit union serving healthcare professionals. Unicred Centro Brasileira realized that new investments in technology were needed to face an increasingly competitive environment. The investments were necessary not only to optimize processes but also to reduce IT maintenance costs, take advantage of new opportunities, and meet its members’ expectations. Key Benefits  Real-time operation qualification  Better alignment among attendance units, Abraccinti cooperatives, members, and suppliers  Unified database with information on physical and juridical persons, organizations, and groups  More free time for networking activities related to the core business 215%More members 510%Credit portfolio growth 424%Growth of assets Executive Summary SAP Solutions SAP Innovations References Contact Us ING Real Estate Best-Run Customers National Australia Bank Standard Bank Nedbank UniCred Centro Brasiliera Why SAP?
  41. 41. © 2013 SAP AG41 / 44 SAP solutions for the banking industry help customer-centric institutions drive the sales and service of innovative products and cut costs while staying compliant with regulators and transparent to stakeholders. Wide portfolio of solutions SAP offers the most comprehensive portfolio of solutions for the banking industry, helping institutions improve their key business processes, comply with regulations, and become more customer-centric. Leveraging breakthrough innovations SAP solutions are based on the industry’s most innovative technologies including the SAP HANA platform, mobile solutions, analytics, and cloud solutions that support business-process optimization at low cost. 40 years of delivering value to banks The world’s leading banks rely on SAP software to support their core business and enterprise. Why SAP? Executive Summary SAP Solutions SAP Innovations References Contact Us ING Real Estate Best-Run Customers National Australia Bank Standard Bank Nedbank UniCred Centro Brasiliera Why SAP?
  42. 42. © 2013 SAP AG42 / 44 The best-run bank organizations rely on SAP. Why SAP? More than 3,700 banking customers in 120 countries. More than 2,600 bank customers use SAP Business Analytics. More than 1,300 bank customers use SAP Business Suite. More than 150 integrated finance and risk management banks. More than 180 core banking customers. More than 85 million live bank accounts (>75 million in implementation). More than 70 bank customers for sales, service, and marketing. More than 1,000 bank customers for database. More than 200 mobile and internet banking customers. Executive Summary SAP Solutions SAP Innovations References Contact Us ING Real Estate Best-Run Customers National Australia Bank Standard Bank Nedbank UniCred Centro Brasiliera Why SAP?
  43. 43. © 2013 SAP AG43 / 44 Benchmark Your Performance Position your organization for dominance in this new economy with the business performance benchmarking program from SAP – available free to SAP customers and select prospects. SAP's benchmarking program has helped more than 3,000 organizations assess their strengths, uncover areas for improvement, and identify best practices and IT strategies that generate clear, tangible value – not someday, but today. Go Live in Weeks Here’s the fastest way to run your business better: Our rapid-deployment solutions. In one package, you get everything you need to be up and running quickly – including preconfigured software and implementation services – in just weeks. With a defined scope and predictable costs, there are no surprises. Join Your Community of Practices Every day, SAP Community Network (SCN) changes the way that thousands of SAP users work. It lets members help one another solve problems, learn, and invent new ways to get things done – faster. Find out how to connect with people, content and resources. Find Out More About How Your Organization Can Become Best-Run Visit valuemanagement.sap.com >> Visit sap.com/solutions/rds >> Visit scn.sap.com >> Executive Summary SAP Solutions SAP Innovations References Contact Us
  44. 44. Industry Executive Overview SAP for Retail and Commercial Banking To find out more, visit us online at sap.com/banking Also visit us on our community pages: www.facebook.com/sapbanking http://scn.sap.com/community/banking blogs.sap.com/banking/. © 2013 SAP AG CMP 23245 (12/12) Executive Summary SAP Solutions SAP Innovations References Contact Us
  45. 45. © 2013 SAP AG. All rights reserved. No part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of SAP AG. The information contained herein may be changed without prior notice. Some software products marketed by SAP AG and its distributors contain proprietary software components of other software vendors. National product specifications may vary. These materials are provided by SAP AG and its affiliated companies (“SAP Group”) for informational purposes only, without representation or warranty of any kind, and SAP Group shall not be liable for errors or omissions with respect to the materials. The only warranties for SAP Group products and services are those that are set forth in the express warranty statements accompanying such products and services, if any. Nothing herein should be construed as constituting an additional warranty. SAP and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP AG in Germany and other countries. Please see http://www.sap.com/corporate-en/legal/copyright/index.epx#trademark for additional trademark information and notices. Gartner does not endorse any vendor, product or service depicted in its research publications, and does not advise technology users to select only those vendors with the highest ratings. Gartner research publications consist of the opinions of Gartner's research organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.

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