Customer Centricity Strategy for Banks, in association with IBBM (Institut Bank-Bank Malaysia). Presented in Kuala Lumpur Feb 2011.

1. Customer Centricity - Strategies to Attract and Retain Customers
Lance Tay
Senior Director, Financials Services Global Business Unit
Kuala Lumpur, 24 Feb 2011
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remains at the sole discretion of Oracle.
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2. Lance Tay
Senior Director, Financial Services Global Business Unit
lance.tay@oracle.com
• Lance Tay is the Senior Director for Banking across Asia Pacific in Oracle’s
Financial Services Global Business Unit (FSGBU).
• In this role, Lance is responsible for providing deep domain expertise to Oracle’s
financial services customers across all of Oracle’s applications and technology
products. Lance brings to this role a wealth of experience and valuable insight
gained through over fifteen years of experience working with some of the region’s
largest financial services companies. His domain expertise includes retail banking,
wealth management, and trade finance. Lance has worked with major financial
institutions in Australia, New Zealand, South East Asia, India, China, and S. Korea.
• Lance is considered a retail banking IT strategy thought leader within the financial
services sector and is a regular commentator in leading industry publications. He is
often invited to speak at industry seminars about breakthroughs in banking IT
strategy.
• Prior to joining Oracle, Lance held management positions at The Boston Consulting
Group, Accenture, and Cisco Systems. Lance also worked at Fidelity-NIS, and
Procter & Gamble.
• Lance holds a MBA from Cornell University, and a Bachelor of Science from the
Southern University of New Hampshire. He has also lived in Sydney, Bangkok,
Mumbai, and Geneva.
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Agenda
• Leadership in Banking
• Create a Customer Centric Enterprise
• Results Achieved by Oracle Customers
4

3. Oracle in Did You Know?
Banking
10 of the top 10 Global banks use Oracle
Applications to run their business
15 of the top 20 Global banks use Oracle
Applications to measure and manage their performance
5
The Challenges We’re Hearing – Globally and Locally
Grow Business & “How can I streamline my business processes to grow
Cross-Sell to wallet share and shorten time to market for new products
Customers and services?”
“The average cost to acquire a new customer is $3,500 in the US”
Compliance & “How can my organization meet the increasing regulatory
Regulatory compliance demands?”
Pressures
“IT spend on compliance will grow annually at 14.1% and reach $3.0 billion by 2006”
Scale Costs to “How can I improve cost efficiency ratios while
Match Market providing greater value to our customers?”
Opportunity
“In the near to intermediate term, the industry is expected to continue to experience pressures on its net interest margin”
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4. Growth Challenge – Attracting & Retaining Customers
Grow Business & “How can I streamline my business processes to grow
Cross-Sell to wallet share and shorten time to market for new products
Customers and services?”
Annual Median Defection Rates (%) Defection rates are high while share
16 of wallet remains low
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14 Average Number of
Products at a Single
12 11 Institution = 2
10
8
6
4
4
2
2
Average Number of
0 Products Per Household = 15
US Canada UK France
Source: Celent Communications
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Customer Centricity – Strategy for Attracting
& Retaining (Profitable) Customers
• “Universal Truths” In Successful Sales
• Good service earns the right to sell
• Customer word-of-mouth is powerful
• Different customer segments have different definitions of
good service and value
• New “Universal Truths”
• Mobile Internet word-of-mouth is ALL powerful
• Customers DEMAND a consistent experience across all
touch-points, 24x7
• A segment of ONE
8

5. A New Approach to Increasing Growth
Become a Customer-Centric Enterprise
A Customer-Centric Enterprise empowers employees with customer data
and insight through end-to-end business processes to ensure the best
decisions are made for both…
Customer
…the company
- and -
the customer…
…at any customer moment of truth
while providing a seamless customer experience.
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Consultants, Analysts, and Bankers Agree !
Leaders Understand Link Between
Service and Sales
(BCG – Global Retail Banking 2010)
Turning Customer Satisfaction Into
Shareholder Value
(McKinsey – Rediscovering The Customer)
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6. The Customer-Centric Enterprise
Key Imperatives
Provide a seamless, unified customer
experience for all customer interactions
regardless of internal organization
Transform customer data into actionable
information by providing the right information
to the right person at the right time
Extend customer understanding throughout
the enterprise thus enabling all functional areas
to make informed, customer-based decisions
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Agenda
• Leadership in Banking
• Create a Customer Centric Enterprise
• Results Achieved by Oracle Customers
12

7. Create a Customer Centric Enterprise
Requirement Oracle Capability The Oracle Difference
Universal Only complete repository for
Provide a single source of Customer data across the enterprise
truth for customer data Master for accessible by a hub & spoke
Banking model
Pre-built Only end to end
Drive intelligent customer Customer performance & profitability
interactions Analytics for analytics in context of
Banking customer interactions
Only complete offer &
Deliver multi-channel Closed Loop campaign mgmt solution
campaign & offer Marketing for with built in analytics to
management Banking measure & refine marketing
programs
360 Degree
Customer View Only multi-channel sales,
Show a complete view of
Through service, marketing and
customer to customer Integrated transaction solution pre-
agent Banking Sales & integrated with core banking
Service
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Create a Customer Centric Enterprise
Requirement Oracle Capability The Oracle Difference
Universal Only complete repository for
Provide a single source of Customer data across the enterprise
truth for customer data Master for accessible by a hub & spoke
Banking model
Pre-built Only end to end
Drive intelligent customer Customer performance & profitability
interactions Analytics for analytics in context of
Banking customer interactions
Only complete offer &
Deliver multi-channel Closed Loop campaign mgmt solution
campaign & offer Marketing for with built in analytics to
management Banking measure & refine marketing
programs
360 Degree
Customer View Only multi-channel sales,
Show a complete view of
Through service, marketing and
customer to customer Integrated transaction solution pre-
agent Banking Sales & integrated with core banking
Service
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8. Need for Single View of Customers
Grow Business & Share of Lower TCO
Customer Wallet • Centralize customer information
• Shift from product centric to management
customer centric view • Automate error handling, account
• Improve the effectiveness of setup & other administration costs
cross-sell and up-sell efforts
Provide Consistent, Manage Governance, Risk &
Differentiated Service Compliance
• Create consolidated, customer • Meet rules for corporate
profile across channels and governance, e.g. Sarbanes-Oxley
operational systems • Address risk management
• Make informed decisions during provisions, such as BASEL II
customer interactions • Comply with regulations such as
• Detect and manage customer USA PATRIOT Act, Gramm-Leach-
events Bliley Privacy Act, ACORD, MiFID
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Master Data Management Enables a Single View
Complete Master Data …Enables a Single View
Management Solution… Of Customers
• Creates and maintains a unique,
complete and accurate customer
information across the enterprise
• Distributes customer information to all
operational applications just in time
• MDM enables organizations to:
• Know your customers
• Improve data quality
• Utilize customer insight during all
customer interactions
• Comply with privacy and regulatory
requirements
• Reduce data management costs
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9. Master Data Management for Banking
Provide a Single Source of Truth for Customer Data
Integration Data Quality
Services Services
Customer
OAS Data Hub Web
10g Services
Siebel Oracle
CRM ERP
ISV Core
Partners Systems
3rd Party Vendors
Update
Update Execute
Execute Propagate
Propagate Synchronize
Synchronize
Customer
Customer Survivorship
Survivorship Updates
Updates
• Modify Customer • Cleanse Data • Determine relevant • Publish updates into
Information • Determine systems customer data hub
• Changes in any Survivorship • Send new account from core and back
application are • Merge Records information office systems
transmitted to master • Cross-Reference • Respond to master
data hub Customers customer changes
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Create a Customer Centric Enterprise
Requirement Oracle Capability The Oracle Difference
Universal Only complete repository for
Provide a single source of Customer data across the enterprise
truth for customer data Master for accessible by a hub & spoke
Banking model
Pre-built Only end to end
Drive intelligent customer Customer performance & profitability
interactions Analytics for analytics in context of
Banking customer interactions
Only complete offer &
Deliver multi-channel Closed Loop campaign mgmt solution
campaign & offer Marketing for with built in analytics to
management Banking measure & refine marketing
programs
360 Degree
Customer View Only multi-channel sales,
Show a complete view of
Through service, marketing and
customer to customer Integrated transaction solution pre-
agent Banking Sales & integrated with core banking
Service
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10. The Value of Intelligent Interactions
• Better understanding of customer behavior and buying patterns
• Identify selling opportunities in real-time (critical for internet age)
• Target the right products to the right customers and the right time
• Understand customer value to move customers into more
profitable relationships
• Retain high-value customers
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Unique Value of Analytics Applications
Leading Customer …with Banking Specific
Analytics Solution… Analytic Applications
• Extends insight from front office to
back office with insight into entire
business process
• Lowers TCO, Speeds Time To
Value
• Enhances value of Front Office
• Over 4 years of development and CRM investments
market success • Deeply integrated with CRM
• THE leading Customer Analytics banking applications
solution
• Integrated analytical insight into
• Hundreds of successful customers your CRM processes
• Broadest support of Siebel CRM
versions
• Pre-built ETL Maps/Data
Integration, Dashboards & Reports
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11. Pre-built Customer Analytics for Banking
Drive Intelligent Customer Interactions
Databases
BI Dashboards Analytics Server
Data Warehouse
Real-time
Real-time
Customer
Customer Operational
Operational Executive
Executive Decisions
Decisions
• Interaction History • Performance • Line of Business • Multi-channel Engine
• Customer Behavior Scorecards Analytics for Real Time
• Segment Migration • Operational Cost • Regional Analytics Recommendations
• Propensity to buy Analysis • Trends • Retention Actions
• Bank Performance • KPI Monitoring
Analytics
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Sales Analytics
Complete Solution for Entire Sales Cycle
Sales Analytics
Analyze pipeline opportunities and forecasts to determine actions required to meet
sales targets. Determine which products and customer segments generate the
most revenue and how to effectively cross-sell and up-sell. Understand which
competitors are faced most often and how to win against them.
Usage Accelerator Analytics Option
Add-on to Sales Analytics empowers front line managers with the information
needed to effectively manage their team’s usage. Removes the ambiguity and
focuses users on the information they need to maintain.
…add Profitability Analytics for insight into customer and product profitability
Profitability Analytics
Oracle Financial Services Applications (OFSA) and Oracle Business Intelligence
Enterprise Edition are now completely integrated, providing financial services
organization with industry leading profitability analytics delivered using the
industry leading Business Intelligence platform.
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12. Service Analytics
Complete Solution for Entire Service Lifecycle
Service Analytics
Complete analysis of the business aspect of the services organization.
Includes analysis of the call center and field service business to understand the
true cost to serve in a complex service business
…add Oracle Contact Center Telephony Analytics for complete insight
Contact Center Telephony
Enables the measuring and managing of multi-channel contact
center operations, key business processes and activities by
providing increased operational effectiveness through detailed
staffing, headcount and scheduling analysis
Also provides increased business value through complete
campaign and sales performance insight by agent and across
customer, product, service and region.
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Marketing Analytics
Complete Solution for Entire Marketing Organization
Marketing Analytics
Campaign Analytics - Provides Campaign Results data by Offer, Segment,
Agent performance. Manager can monitor a campaign scorecard and identify root
causes for shortfalls in meeting predicted goals
Customer Analytics - Provides product affinity, market basket and
next product purchased analysis. Provides demographic information and
information on impact of customer behavior due to marketing activities.
Event Analytics - Provides Analytics related to management of trade shows,
customer events etc. Marketing Events Analytics can show analysis of Event
registrations, expenses on supplies by vendor, region, event etc., Event ROI
analysis that is fully integrated with Marketing Planning Analytics.
Marketing Planning/Executive Analytics
Provides Marketing Planning related information. The information is organized
for different roles like Marketing Executive, Director, Finance Director. The
dashboard also has a Sales Alignment page to allow Sales and Marketing
Executives to co-ordinate activities
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13. Create a Customer Centric Enterprise
Requirement Oracle Capability The Oracle Difference
Universal Only complete repository for
Provide a single source of Customer data across the enterprise
truth for customer data Master for accessible by a hub & spoke
Banking model
Pre-built Only end to end
Drive intelligent customer Customer performance & profitability
interactions Analytics for analytics in context of
Banking customer interactions
Only complete offer &
Deliver multi-channel Closed Loop campaign mgmt solution
campaign & offer Marketing for with built in analytics to
management Banking measure & refine marketing
programs
360 Degree
Customer View Only multi-channel sales,
Show a complete view of
Through service, marketing and
customer to customer Integrated transaction solution pre-
agent Banking Sales & integrated with core banking
Service
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The Need for Closed-loop Marketing
Consumers Demand a Richer and More Relevant Dialogue
Traditional (direct and above-the-line) marketing is ‘not working’
• Average response rates for traditional direct marketing activities just 2.6%1
‘Pray and spray’ marketing destroys relationships as well as brand value
• Consumers see over 3,000 (direct/indirect) marketing messages each day. Over 60% cite over-
solicitation’ as a reason to defect.2
Under Pressure for Accountability, Alignment and Proven ROI
from Marketing Investments
Expenditure is huge, results are unproven, processes are inefficient
• Where measurable, 20% of marketing spend is wasted3
It must be accountable, for every action taken and every dollar spent
• Marketers cannot calculate ROI for 40-60% of spend3
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14. Closed Loop Marketing for Banking
• Fact-based planning & budgeting
• Open, flexible, business intelligence platform Customer & • Enterprise calendar
• Powerful descriptive and predictive analytics
Business • Project and content management
• Pre-built dashboards, personalized access
Insight • Align and optimize spending
Marketing Planning &
Reporting & Resource
Analytics Management
• Closed loop tracking
• Role-based, real time analytics Manage Understand
• Segmentation and targeting
• Continuous learning • Campaign design and execution
Customer
Measure
• Targeted loyalty campaigns
Plan
Response &
Lead Execute Campaign
Management Management
• Multi-channel response capture Events
• Collaborative lead management Management &
• Integrated ROI analytics Execution
• Events management
• Invitation, registration, follow-up
• Integrated customer-facing portal
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Closed Loop Marketing for Banking
Complete Multi-Channel …with Embedded Insight
Marketing Solution… & Segmentation Tools
• Best-in-class marketing solution that
aligns and optimizes corporate and • Complete end-to-end solution that
branch marketing links strategy and planning with
execution and measurement
• Coordinated communications across
channels and collaborative execution • Fusion of insight and action for
with branches and relationship accelerated campaign execution
managers and intelligent offer
recommendations
• Tightly integrated with channels
including call center, branches, field,
and partners for superior customer
experience and closed-loop execution
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15. Closed Loop Marketing for Banking
Deliver Multi-Channel Campaign & Offer Management
Acquisition On-Boarding Retention
Segment
Segment Create
Create Execute
Execute Analyze
Analyze
• Define Customer • Design Multi-Stage • Initiate Campaign • Review Campaign
Segments Campaign Waves Effectiveness
• Slice & Dice • Attach Offers to • Monitor Campaign • Monitor Results in
Segmentation Data to Campaigns Progress Real-time
Refine Queries • Test Campaigns • Adjust Campaigns • Evaluate Offers
• Assign Channels • Review Campaign • Compare Campaigns
Calendar
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Create a Customer Centric Enterprise
Requirement Oracle Capability The Oracle Difference
Universal Only complete repository for
Provide a single source of Customer data across the enterprise
truth for customer data Master for accessible by a hub & spoke
Banking model
Pre-built Only end to end
Drive intelligent customer Customer performance & profitability
interactions Analytics for analytics in context of
Banking customer interactions
Only complete offer &
Deliver multi-channel Closed Loop campaign mgmt solution
campaign & offer Marketing for with built in analytics to
management Banking measure & refine marketing
programs
360 Degree
Customer View Only multi-channel sales,
Show a complete view of
Through service, marketing and
customer to customer Integrated transaction solution pre-
agent Sales, Service, integrated with core banking
CoreBanking
34

16. 360 Degree Customer View Through Integrated Banking
Sales & Service
Show a Complete View of Customer to Customer Agent
Agent Desktop Web Services
Core Systems
Single View
Single View Guided
Guided Opening //
Opening Service
Service
of Customer
of Customer Selling
Selling Fulfillment
Fulfillment Management
Management
• Real-time Balances • Cross-Sell/Up-sell • Multi-product • Financial Transaction
• Account Details & • Sales Offers application processes Support
Transaction History • Needs Analysis • Data capture • Common Service
• Contact & Opportunity • Product Catalog • Document fulfillment Issue Management
Management • Product Features / • Account Funding
• Interaction History Benefits
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Customer Centricity Strategy Requires Front,
Middle, and Back-Office Solutions Working Together
Channels
Branch Sales & Lending /
Call Center Internet / Mobile Branch Teller
Service Agency / Distr.
Functions
Leads & Referrals Guided Selling Origination & Fulfillment Maintenance Transactions
Campaigns Needs Analysis Deposit Origination Self Service Cashboxes
Offers Task User Interface Lending Origination Activities Electronic Journal
Incentive Tracking Collaborative Sales Document Generation Service Management Store & Forward
Consistent Customer Experience Across Channels
CRM Core Components
Real Time Decision Engine Workflow Engine Rules Engine Financial Transaction Engine
Assignment & Routing Engine Product Configuration Engine
Customer Data Integration
Products Master Customer Master Service Master Marketing Master
Core Banking / Product Processing
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17. Summary - Customer Centricity Strategy for
Attracting & Retaining (Profitable) Customers
Universal Customer • Only complete repository for data across the
Master for Banking enterprise accessible by a hub & spoke model
Pre-built Customer • Only end to end performance & profitability
Analytics for Banking analytics in context of customer interactions
Closed Loop
• Only complete offer & campaign management
Marketing for Banking solution with built in analytics to measure &
refine marketing programs
360 Degree Customer • Only multi-channel sales, service, marketing
View through Integrated and transaction solution pre-integrated with
Banking Sales & Service core banking
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Agenda
• Leadership in Banking
• Create a Customer Centric Enterprise
• Results Achieved by Oracle Customers
45

18. What Customers are Achieving
“Our Multi-channel Program delivered by PeopleSoft Enterprise
CRM, enables every ABN AMRO Bank client to choose how and
when they wish to communicate with us. This allows us to be
trendsetters in our industry.”
“…we saw a 29% increase in the ratio of opportunities created to the
number of cashier transactions processed. We also recorded a 13%
increase over that period in the ratio of actual referrals to original
approaches made to customers.”
Oracle’s Siebel Finance is at the heart of Robeco Bank Belgium’s
strategy to manage the life cycle of the customer relationship.
Account managers are managing 20% more customers each using
Siebel Finance.”
“In the four years since the Siebel deployment, average sales for
CRM-enabled branches have increased by 71% for auto loans,
110% for mortgage lending, and 164% for credit card
applications.”
46
Industry Quotes
“ With a highly scalable, comprehensive solution, Oracle’s Siebel CRM
provides best-of-breed marketing and sales tools… Let’s face it —
Oracle understands the needs of FSIs at a broad level.”
“ Oracle has been kicking its game into high gear. With 22 acquisitions in
24 months, the longtime database kingpin and middleware applications
player has gorged on new products and capabilities…The buying binge
also have served to reinforce the company's commitment to amassing
deep expertise in financial services-something not lost on clients in that
industry.”
“ Oracle’s acquisitions of PeopleSoft and Siebel give it a more significant
footprint in business intelligence (BI), analytic applications, and
performance management.”
“ Oracle’s Siebel purchase should drive more value for customers
through integrated business management applications, and deliver
existing Oracle customers with more sophisticated CRM
functionality.”
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19. The Only Complete Banking Solution
Platform
Processes People
Customer
Results
Partners
48
Oracle
Oracle’s Banking Footprint ISV Partners
Governance, Lifecycle Management Customer &
Risk & Business
Marketing Selling Originating Servicing
Compliance Insight
Risk Based Retail Customer External
Commercial Private Wealth Mgmt Insight Interfaces
Decisioning
Customer Experience Customer
Risk Based OFAC
Pricing Call Team Order Internet CRM & Lead Financial Analytics
Platform Teller Center Selling Mgmt Banking Marketing Mgmt Planning
Channel Check
Economic Internet Analytics
Capital/RAPM Kiosk EBPP Security Client Derivative Order Entry On Call Order
Banking Trading Servicing Pricing Platform Demand Center
Marketing Market
Product and Transaction Processors Analytics Feeds
Risk Deposits Savings Deposits Cash
Mgmt Loans Integration Performance Mgmt
Management Mkt Data Performance
Trade Management
Treasury Payments Balance & Positions
Operational Finance Portfolio
Loans Mortgages Exec Analytics
Risk Mgmt
Asset Syndicated Structured Fees & Commissions
Mgmt Loans Derivatives Profitability
Market Risk Cards Compliance Analytics/RAPM
Investments (Credit / Debit) Compensation
Investor Nostro Lock Box & Limits
Services Recon Funds Transfer
Trade Clearing & Reconcil
Credit Risk Payments Leasing Core Banking
Ledger Leasing Custody Core Banking
Pricing
Ledger Processing Settlement -iation
Operational
ALM Excellence
Master Data Management
Customer Data Hub Product Hub Org Hierarchy Hub Accounting Hub Payments Hub Op Intelligence Fed Wire
HR Analytics
Compliance Corporate Administration SWIFT
Enterprise GL Consolidation Budgeting Profitability Mgmt Incentive Comp Analytics
BASEL II Platform POS
& 1A
Human Capital Mgmt Projects Procurement Fixed Assets Real Estate Portal &
Credit
Dashboards Rating
AML
Business
Enterprise Technology Activity ACH
SOX Rich Client F/W Database (Grid, Enterprise Content Web Services J2EE Services, ESB Monitoring
AJAX, Web 2.0 Memory, Embed) Mgmt Orchestration (BPEL) and Rules Engine Other
Business Systems
Regulatory Process
Reporting Systems Mgmt Directory Services Web Services Mgmt Identity Mgmt Access Mgmt Analytics

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