Chartered Bank was looking for a tool that would help
it analyze the huge volumes of data captured by its
OLTP systems. The objective was to analyze new business
opportunities, provide better customer service, and
boost profitability. by Soutiman Das Gupta
Chartered Bank (SCB) previously used OnLine Transaction
Processing (OLTP) system, which facilitated and managed
transaction-oriented applications. "The system
was reliable but provided little scope for in-depth
customer analysis, which is the key to survive in the
fiercely competitive financial marketplace. It answered
the financial queries and generated reports at a broad
portfolio level, which included total earnings, debt
situation, interest income, cost, fee income, and profits,"
said Sedjwick John Joseph, Head-Business Intelligence
The bank realized that it needed to go a step further
and deploy a solution which it can use to analyze the
huge volumes of data captured by its OLTP systems. The
idea was to search for crucial nuggets of information
from the vast amounts of transactional data at its disposal
to get the right information, to the right executive
and at the right time. This information can help a bank
take critical business decisions in the dog-eat-dog
The bank's IT team looked at the business requirement
in detail and deduced that the organization needed a
data warehousing and analytical solution that would
help analyze customer data to enable fact-based decision
making in areas ranging from acquisition and risk management
to cross-selling and portfolio management. After evaluating
a number of vendor offerings, SCB decided to use a suite
of products from SAS. It went for the SAS Customizable
CRM Solutions (See box: The solution up close).
Standard Chartered Bank has over 2.2 million
retail customers and over 1.3 million credit
card customers nationwide. Its products and
services include cash management, custody, lending,
foreign exchange, interest rate management,
and debt capital markets.
The bank needed to manage and analyze the huge
volumes of data captured by its OLTP systems.
It had to get the right information, to the
right people, at the right time, in order to
carry out a number of critical business activities
and provide excellent customer service.
SCB decided to go for SAS Customizable CRM Solutions
to address its business needs.
The bank can now exploit changing and widening
markets; implement a customer-centric approach;
concentrate on financial budgeting, cost control,
and risk management; and figure out new ways
to minimize costs, while increasing profitability
and shareholder value.
A better way to understand the bank's need would be
to understand its customer base and the varied services
SCB has over 2.2 million retail customers and over 1.3
million credit card customers nationwide. It claims
to be the first to launch initiatives like a Global
Credit Card and a Photocard in India. Its products and
services include cash management, custody, lending,
foreign exchange, interest rate management, and debt
capital markets for corporates. And credit cards, personal
loans, mortgages, deposit taking activity, wealth management
services to individuals and medium-sized businesses,
and mutual funds to retail customers.
"Our customer base has grown three-fold in the
last three years. Such a fervent pace needed to be supported
by efficient management of the huge volumes of data
generated and captured at each touch-point. After all
it is absolutely essential to keep up the bank's unchallenged
reputation of efficiency," said Sedjwick.
The bank's vision was to champion fact-based strategic
business decisions using best-in-class analytics. The
objective was to enhance the organization's competitive
advantage and boost profits. The bank was looking forward
to the following broad benefits:
The ability to exploit changing and widening markets.
The ability to implement a customer-centric approach
focused on optimizing the lifetime value of the customer.
The ability to concentrate on financial budgeting,
cost control, and risk management.
To look for new ways to minimize costs, while increasing
profitability and shareholder value by effectively
managing consumer relationships.
It was clear that in order to achieve the desired benefits,
the bank had to implement a data warehouse and analytical
solution. Sedjwick said, "We wanted a solution
that can perform analytics on the valuable customer
data to answer queries across divisions. The answers
would then enable us to proactively service customers
and thereby ensure customer loyalty and retention. This
exercise is a must for survival in a fiercely competitive
He continues, "Any bank today cannot ignore the
risk:reward equation. Calculating it is a complex and
challenging task that all bankers have to accomplish.
It's the process of applying a variety of scoring techniques
across product lines to arrive at the probable risk
associated with each product sale and the possible rewards.
Examples of products are credit cards, auto loans, and
personal loans. We wanted the solution to leverage information
on customer profiles and segments and enable us to spread
our risks based on empirical data analysis."
"We also wanted the solution to be scalable. This
was crucial as the solutions would be very critical
to our business, and the volumes of data kept increasing
The bank created a team of 25 people in Bangalore and
called it a Business Intelligence Unit. This unit was
responsible for deriving and implementing strategies
to analyze and exploit customer data.
"The company evaluated a number of solutions from
Brio, Cognos, Business Objects, and SAS. SAS was chosen
as the preferred solution partner and SCB today relies
on SAS solutions across Asia for its customer analytics,"
The SAS solutions reside on an IBM RS/6000 server running
the AIX operating system. The SAS software accesses
and integrates data from multiple sources and disparate
systems across the enterprise. This data is then used
for a variety of analyses by the Business Intelligence
Unit and is disseminated to all information consumers
across the bank. The information consumers include sales
managers, finance resources, credit resources, product
heads and managers, and the head of consumer banking
via the SCB Intranet. "As a result, analytics provide
a key competitive edge and are used seamlessly for empowering
business manager in their goals," said Sedjwick.
The solution has helped the bank effectively manage
and optimize profitability of all the products that
constitute its retail portfolio.
Sedjwick said, "SAS's solutions forms a central
part of the bank's CRM strategy. It is easier for us
to run targeted campaigns and elicit substantially higher
returns since we perform profit modeling for each account.
This also enables micro-segmentation. Using analytics,
and a test and learn culture we know the likelihood
of customers to take a new product. We now know which
card member is more likely to take an auto loan. This
has resulted in more focused marketing campaigns and
reduced costs with improved customer satisfaction."
The organization's marketing team is now empowered with
information to increase cross holding, and can target
its most valuable customers (not accounts within a product
line) and also help in the next best product strategy
for a customer.
With the help of the Business Intelligence (BI) solutions,
SCB was able to successfully launch DIVA. DIVA is a
specially designed women's international credit card
targeted at the Indian woman and bundled with several
features. It includes discounts and zero interest rates
on categories like jewellery, cosmetics, apparel, consumer
durables, leather products, and mobile phones.
"This was possible due to an in-depth analysis
of our customer data provided by the BI solutions. We
realized that a significant proportion of our business
came from the upwardly mobile Indian woman and was likely
to grow substantially from this section in the coming
months. This gave us an impetus to launch a product
which catered to the needs of this segment and consolidate
our position in the mind of the customer," said
The bank also launched the aXcess plus savings account.
Customers who have this account can access cash at over
1800 ATMs worldwide through the Visa network. Besides,
they can use this account to shop for goods and services
at over 25,000 outlets in India and at 10 million outlets
worldwide. "This strategy was validated and facilitated
by the information provided to us by the BI unit. We
realized that by using this technique we could provide
more value to our savings account customers and help
increase customer loyalty," declared Sedjwick.
"We are successfully able to calculate our risk:reward
equation," said Sedjwick. SCB uses SAS for scoring
virtually all its products in the asset portfolio ranging
from its 1.3 million credit card holders to its loan
portfolio in excess of $ 860 million. "Information
on customer profiles and segments forms the backbone
of product strategy for us. It allows us to tailor our
products across a diversified consumer base, enabling
us to spread the risk across a much wider spectrum,"
SAS solutions are also used to carry out simulations
that help the bank assess its overall profitability
and balance its exposures across portfolios. The bank
can carry out stress tests on its portfolios and learn
about the best case and worst case scenarios. The working
of the SAS library of advanced statistical techniques
helps in achieving the results and arriving at an optimized
"The solution can scale to handle different sizes
of data and takes much less time to analyze SAS data
sets than it takes to analyze a standard relational
database," said Sedjwick.
In future SCB plans to embark on SAS' data mining technologies
for various predictive modeling and advanced scoring
initiatives to strengthen its risk management framework
in the area of retail lending.
"Now that we know our customer well enough to provide
effective customer service and maximize shareholder
value, we will keep using information strategically
so that it contributes in providing a cutting edge to
our organization," said Sedjwick.
solution up close
Chartered Bank uses SAS Customizable CRM Solution.
SAS feels that a company has to adopt a truly
customer-centric approach to manage its business.
It means that fundamental decisions on strategy
and resource allocation must be based on a detailed
and accurate understanding of customers and the
overall market. It feels that customized CRM solutions
can provide access to the information you need
to come out on top.
The customizable CRM solution can:
Integrate information from multiple sources,
eliminate data errors and redundancies, tailor
data for efficient access and analysis, and
reduce the complexity of data management.
Anticipate customer expectations and predict
customer behavior like, propensity to purchase,
lifetime profitability, and credit risk.
Allow to cross-sell and up-sell. It can help
identify the best candidates for purchasing
particular combinations of products and services,
and focus the marketing efforts on a more receptive
Combine business rules and analytic models to
accurately segment and profile customers, and
construct a personalized strategy for each group.
Deliver customer intelligence into front office
systems to enable smarter customer interactions
through various channels.
Combine behavioral insights derived from analytics
with attitudinal data obtained from online and
offline customer surveys.
Das Gupta can be reached at email@example.com