Tackling information glut through integration

Smitha M

Flash-Back: Ten years back when one thought about a bank, it was a

strong structure with strong rooms and slow processes. To perform a simple

operation such as withdrawing money you had to go through minimum of two-three

bank employees and be ready for a wait of one-two hours. Leave alone the time

inconveniences, if you required money, you had to go to the bank where you had

the account.

Not only this, you had to plan for your expenses well in advance. There was

no way to withdraw money outside banking hours in case of an emergency

requirement.

Zoom back to today: Technology and competitive environment has come

together to bring unimagined of services to the customer. Any Time Money, credit

cards, Internet banking, phone banking you name it and it is there.






However, with the modern and tech savvy banks today, you don’t have to
maintain passbooks to keep a record of your bank balance. To find your balance,

you don’t have to even go to a bank branch. Just walk into the nearest ATM or

call the bank or log-on to the net to know your account details.

Challenges of Multi-Pronged Distribution Network

With the increased customer expectations, banks have evolved multitude of

delivery channels to match the same. A customer has the choice of using any or

all these channels. Contrarily, the banks are now faced with a problem of

tracking customer data spread across various points in different databases.

(The figure shows the growth in the number of distribution channels over a

period of time.)

With technology, information has become a key factor. Banks are coming out

with more and more customized products in their portfolios. Now, a bank customer

is himself a target audience for new products introduced by the bank. In fact a

bank tries to lock a customer by providing him with multiple services from its

portfolio. This ensures that all the financial needs of the customers are taken

care by a single bank itself.

But to come up with a perfect solution to match customer requirements, the

bank needs to make a through study of the preferences and financial habits of

the customer.

In the past, obtaining customer information was easy, as all the information

pertaining to the customer was present in a single location (which was often the

account folder of the customer in the bank where he had the account). Today

various customer touch points provide different amount of diverse data about the

same customer.

Therefore, the challenges before the banks are to collate these data and

derive meaningful information out of it. This has meant a search for a solution

that would integrate multiple delivery channels.

Integration, a one-stop solution

Integration of multiple channels has also become of paramount importance due

to a need to codify and make uniform all customer interactions with the bank. As

it is essential to respond to customers in real-time, it is critical to have

details of past customer transaction at all touch-points.

Integration of all customer detail provides the bank with ability to get

in-depth customer profile. This enables the bank to introduce new products to

its portfolio range targeted at specific customer class. This leads to better

customer value.

An example of this kind of customization is DIVA. DIVA is a Standard

Chartered Bank product targeted at the fast growing working Indian woman

population. The bank used customer analysis to study the spending patterns of

this class of customers and came up with special features for their DIVA credit

cards such as discounts and 0% interest on cosmetic, consumer durable, travel

etc. brands.

Technology solutions that can enable such data collation and analysis include

data mining and business intelligence solution.

An effective channel integration requires robust networking. Information from

all customer touch-points needs to be present at one central location.

Integration of data from multiple customer touch-points enables banks to

provide dynamic end-to-end solution. This helps banks to retain and focus on

profitable customer base, effectively utilize cross selling opportunities and

maximize return on investments (ROI).

Business Assessment:

• Need for integration of data from various customer touch-points in the
  
  banking sector
• Requirement for a robust and well connected network
• Requirement for data mining and Business Intelligence solution