Transcript Slide 1

Developing Alternative Distribution Channels in the
Bulgarian Banking Sector
Create an integrated, customer focused, alternative way of customer
servicing and business development
October 2013
Alternative Distribution Channels: Definition
New
Integrated
Services
BRANCH
KIOSK
- Automated
Integration
- e-Applications
- e-Payments
- Deposits
- Withdraws
- Automated
banking
- e-Applications
- Information
- Sales
- Remote assistance
- Promotions
PHONE
BANKING
MOBILE
BANING
- Transfers
- Information
- Sales
- Alerts
ATM
- Withdraws
- Deposits
- Transfers
- Information
- Sales
- Utility Payments
e-B2B
- Distributed
Electronic Services
- Multilink Transfers
- Business Network
Services
- Customer Programmes
INTERNET
BANKING
- Remote Transfers
- Multiple Accounts
- Information
- Sales
- Alerts
- e-Applications
- IVR
- Call Canter
- Information
- Transfers
- Sales
- Banking Support
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The importance of Alternative
Distribution Channel (ADC) services
Role
The role of ADC is to create and maintain a friendly, convenient and engaging
banking experience
 24hr, Online, real-time access to the Bank
 Access through the majority of “touch-points” customers use (PC, ATM,
Mobile, Tablets, phone, social media, etc.)
 Adding value added services to contribute to customer satisfaction &
retention (e.g. SMS alerts, location based services, B2B etc.)
For the client
ADC services are a strategic asset from a customer perspective as Bank
customers are becoming more demanding from their overall banking experience
 The majority is banking with more than one institution
 They demand more “power”, control, transparency & quality of service
 The new generation is used to instant and free services
For the bank
ADC services are a strategic asset for the Bank, in order to implement a
common multichannel strategy aiming to enable the delivery of an integrated
set of services to customers while at the same time achieve cost efficiencies and
increased revenue streams.
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ADC in Bulgarian Banks / Service Offering
Services
Comparison
Bank
E-Banking
M-Banking
Phone Banking
ATM
Postbank
√
~
√
√
Unicredit
Bulbank
√
√
DSK
√
√
Reiffeisen
√
~
UBB
√
~
√
√
FIB
√
√
√
√
~ M-banking partial services
√
√
√
√
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ADC in Bulgarian Banks / Organization
Services
Comparison
Bank
ADC
Combined
Business &
Operations
UBB
√
FIB
√
Reiffeisen
√
ADC
Business
Part
ADC
Operations
Part
Unicredit Bulbank
√
√
DSK
√
√
Postbank
Fragmented
√
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Proposed Model Overview:
Centralization of Services and Coordination
Alternative Distribution Channel unit, should be responsible for all channels and
electronic services offered by the Bank (e/m-Banking, Phone Banking, ATMs
Coordination
channels as well as B2B services) across customer segments (Retail, SBB,
Corporate etc.)
The centralized unit should be responsible for driving the design of innovative
electronic services and solutions and also for the:
• Design, Business Development and Support of electronic products and
Centralisation
services (banking and non-banking)
• Management of the Bank’ online presence and digital marketing actions
• Promotion of electronic products and services of the Bank across available
media
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Proposed Model Overview:
Centralization of Services and Coordination
Centralization of the ownership and accountability across electronic channels and
services will:
•control in a seamless manner a common multichannel strategy aiming to enable
the delivery of an integrated set of services to customers while at the same time
achieve cost efficiencies and increased revenue streams for the Bank.
•ensure the proper adaptation of internet service capabilities, providing
customers integrated management of their bank relationships and transactions.
Centralisation
•facilitate the offering of combined packages of products and services (bundling)
Principles
•aggregate the monitoring of technological and operational developments and
electronic behavior trends aiming to adopt effective solutions which improve
service quality and reduce transaction costs
•create value by providing B2B services (i.e. e-payments, floorplan schema,
e-marketplace, e-catalogue, e-auctions and e-invoicing bundling)
•establish an in-house expert center benefiting from economies of scale created
in both resources and operations management
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Towards an Integrated Approach
Alternative Channels Integration
 Integrate all existing alternative channels under a unique business
unit
 ATMs, APSs, e-banking, m-banking, Phone-banking/Call Center to be
integrated into a new Alternative Distribution Channels business
unit
How
 The new unit to define & implement the ADC business strategy
targeting the increase of the customers’ transactions through the
bank’s alternative channels and the reduction of the transactions
costs to the bank’s benefit
 The new unit to share a common already existing infrastructure,
which will evolve in sync for all channels following the “develop
once, use many” approach, hence achieving economies of scale.
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New ADC structure enabling unified
Commercial, Operational and Support approach
Functions
Unified
Services
Commercial
Operational
Support
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Desired ADC model
The three
core
functions
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The target operating model should be based on centralization and
consolidation of business and support functions, across channels
New
Structure
Integrated on
one line level
Coordinated
functions
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Steps to achieve ADC integration
Potential
Options
for an
effective
ADC unit
Option 1: ADC under OTO
Headed by an experienced executive having experience and overall responsibility of the ADC section
• Strategy definition and implementation emanating from the unit itself; development of ADC is the
main reason of its existence, not a side-show
• Close and effective cooperation with Network Division and the branches but also “healthy
competition” in place
• Vertical integration of the unit’s functions in the sense that business development, customers support
and daily operations are provided by the ADC own resources
• Revenues of the ADC unit calculated at VBM level they practically impact branches’ P&L
• Improvement of Operational efficiency trough close cooperation with the rests of OTO units will
ensure improved customer experience
Option 2: ADC under Network Division
• Headed by an experienced executive having experience and overall responsibility of the ADC section
• The ADC section acts complementary to the branches and supports branches targets; branches
constitute a major part of the ADC strategy.
• Revenues of the ADC services calculated at VBM level they practically impact branches’ P&L
Option 3: ADC Unit as another Division
• Headed by an experienced executive participating at ExCo level
• Strategy definition and implementation emanating from the unit itself; development of ADC is the
main reason of its existence, not a side-show
• Close and effective cooperation with Network Division and the branches but also “healthy
competition” in place
• Vertical integration of the unit’s functions in the sense that business development, customers support
and daily operations are provided by the ADC own resources
• Revenues of the ADC unit calculated at VBM level they practically impact branches’ P&L
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Benefits of the ADC integration
Key
Opportunities
1. Exploit sales potential of online channels
Considerations - start to build capabilities to drive sales and leads from online
banking, including:
• Reviewing public website to ensure all product pages have a clear call-to-action,
with multi-channel options
• Consider building promotional capabilities within online banking to drive leads
• Implement simple information gathering / online ‘application’ forms to track
demand
• For high propensity products, consider developing more functional application
processes
• For those products where a signature is required, optimize the online / offline
completion model
2. Creation of an Integrated Business Model for increasing payments through the
use of ADC (i.e. Utility Payments, Transfers, etc.)
3. ATM profitability improvement through increasing the services provided and
improving the location setup and management
4. Improve Sales of products by using new techniques of presenting sales
opportunities while the customer performs specific transactions within the
Bank in ADC (for example Finalta Case Study – please see next page)
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Benefits of the ADC integration
Finalta Case
Study
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e-Services Branding
bank’s Branding
Proposals:
bank’s
Distinctive
&
New
Integrated
e-Services
Image
Other Banks’ Branding Examples:
Digital Banking
bank Direct
bank Digital
bank Dynamic
bank 24/7
bank Online
bank.Net
bank Everywhere
bank #1
PrimeBanking
Bank2
BankMall
iBank
iTransact
All-In-One-Bank
Bank4U
MyBank
BankNonStop
UniverasalBank
UniversalBanking
e-Banker
e-Prime
e-Touch
e-Standard
e-Dynamic
e-International
e-PersonalBanking
e-Everywhere
| DSK - DSK Direct | FIB - My Fibank & Virtual Branch | Bulbank - Bulbank Online | Raiffeisen - Raiffeisen ONLINE |
| UBB - UBB Internet Banking | CITY Bank - Bank online | VTB - VTB24 | ING - ING Online |
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Key Success Factors
• Top management commitment in order to support the effort and
facilitate to overcome resistance to change.
Integrated
Alternative
Distribution
Channels
• New organizational structure that will support the integration and
business development and increase the bank’s penetration rates to the
individual, SB and Corporate customers segments.
• Staffing with an adequate number of experienced employees.
Aiming
centralized
and
coordinated
efforts in a eservice for
clients
• Clear Alternative Channels strategy definition and implementation.
• Effective cooperation of the involved BUs; Network, Consumer and IT
Divisions contribution towards the integration of the Alternative
Channels is considered important.
• ADC revenues and cost allocation to the service recipients (bank’s BUs)
through an allocation model that will support sales efforts, improve
productivity and increase customer service levels
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THANK YOU!
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