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Issue of July 2003 
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Cover Story: Business Intelligence

Lessons from life

We present three Indian enterprises that have successfully deployed Business Intelligence tools and solutions in their networks. These companies are very clear about the reasons for deploying the solutions, and have a definite path chalked out for receiving benefits. The three organizations are the Reserve Bank of India, BPL mobile, and Kisan Ratilal Choksey Shares & Securities. We hope that these cases provide insightful reading, and provide you a view of what these companies see in the use of BI tools in their networks. Maybe someday you'll begin to use it too.

RBI goes the intelligent way

The Reserve Bank of India (RBI), the largest and most respected financial institution in India, collects vital information from more than 200 nationwide sources. Data comes from various banks, non-banking financial institutions, and government agencies.

And using the information from the reports generated from these sources, RBI provides the pulse to the nation's economy. It performs functions like regulation, monitoring, and formation of monetary policies.

Policy-making and other activities at this institution required a lot of information to be collected and analyzed on the fly. But information flowed into RBI in disparate formats like MS-Excel sheets, Foxpro files, Oracle databases, and other assorted formats. Information came from disparate systems like mainframes, low-level servers, and even desktop workstations.

Warehouse and BI

"We felt the need to bring this multitude of information onto a single platform. This would provide a single version of the enterprise-wide picture. The idea was to make relevant information available in a way that financial planners,
policy-makers, and business users can make sense without intervention of IT personnel," said Dr. A.K. Nag, Director, RBI, Department of Statistical Analysis and Computer Services.

RBI has now deployed a data warehouse to collect, organize, and collate information available within the organization. This is one of the most complex if not the largest data warehouse in India. And to take things a step forward, the institution uses Business Intelligence (BI) tools to access relevant information, run analyses on them, and generate many pre-formatted reports which are ready for use by operational and research departments engaged in monitoring and regulating various segments of the financial sector.


"Although we have a very large amount of data flowing in from multiple sources, the unique and critical aspect was not size or volume of data. We had to address the issue of complexity of data," explained Dr. Nag.

To understand this let's look at some of the sources of information.

  • Credit and deposit activities at nationwide banks and other financial institutions.
  • P&L accounts and balance sheets from all non-banking financial institutions.
  • Statistical organization generating GDP estimates.
  • Other organization generating figures like inflation estimates, Wholesale Price Index (WPI), and Consumer Price Index (CPI).

RBI has a number of departments, which look after different operational and business aspects like credit flow to commercial sector, regulation of statutory norms, and monitoring of health of various segments of the financial sector. Information has to flow across different departments regularly to coordinate these activities.

After complexity, the challenges were to store and archive the information, present it to the analysts and policy-makers in a user-friendly way, derive intelligent value from it, and create a single enterprise-wide store of information and reports.

The beginning

"We decided to use a data warehouse because we wanted a single version of the truth," said Dr. Nag. It would provide benefits like:

  • Provide uniform organization of data.
  • Enable decision-makers to get information from one place.
  • Reduce time and resources spent to collate relevant information.

RBI set up a data warehouse in its data center in Bandra-Kurla Complex, Mumbai, and it has been in operation for the last six months. "The warehouse gives us a multi-dimensional view of the data, and provides a number of benefits," explained Dr. Nag.

Some of the benefits are:

  • The data is collated and integrated.
  • Since different sources of data have different coding structures and representations, the data is transformed to give it a unique representation within a desired enterprise-wide data model.
  • The data is subject-oriented. Meaning, it can be accessed according to the subject of interest of the end-user.
  • The data is non-volatile.
  • Information is not stored as a simple time-series as done in many central banks.
  • After transformation, the data is loaded using tools like ROLAP and/or MOLAP. The information is represented as a multi-dimensional object or a dimension of the user's choice. Examples of dimensions are banks, spatial entities like districts and centers, and types of instruments.

RBI's activities

RBI performs a number of functions, which provide the backbone to the Indian economy. Being a central bank, the business driver is to understand structural trends, and changes in the entire economy, particularly in the financial and monetary aspects. RBI performs duties like regulation, supervision, monitoring, tracking, and formulation of monetary policies.

These activities require that information be analyzed to identify emerging trends, and structural vulnerabilities. This helps to make decisions on aspects like monetary policy, credit delivery-related activities, and banking organization health.

BI comes in

The data warehouse enabled RBI to bring discipline in its data. But now, it needed to enable users in various departments and sections to get the relevant information to carry out the institution's activities.

Dr. Nag explained this need, with an interesting analogy. "A doctor needs to run a patient through a number of tests and view the reports in order to prescribe medicine and plan a health map. Similarly a regulatory supervisor like us must understand the constituencies under its fold. This understanding comes from the intelligence generated from various relevant structured information. And BI tools facilitate these kinds
of analyses."

RBI deployed BI tools from Business Objects in its Data Warehouse and it offered features like Relational OnLine Analytical Processing (ROLAP), SQL-based query, and ad-hoc queries. It is using Hyperion ESSBASE and Hyperion Analyzer for accessing MOLAP databases. RBI also uses Cognos BI tools for a few departmental data marts.

How BI helps RBI

Although the use of BI tools is rather new, RBI has derived a number of benefits from it. Some of them are inflation tracking, nationwide financial institutions' credit and deposit tracking, Government revenue tracking, and merchandise export data.

Here are some of the benefits explained:

Inflation tracking - Earlier, smaller application programs were used to calculate different inflation measures like contribution of individual commodities or that of a group of commodities based on official WPI. These measures were used to track different aspects of inflation. The use of BI tools has now provided a lot of flexibility. They allow business analysts at RBI abilities like:

  • A look at the list of commodities that have contributed most to inflation.
  • A group-level look at the commodities that contributed most to inflation.
  • The behavior of inflation over a certain period, and the likelihood of change.

Nationwide financial institutions' credit and deposit tracking - RBI acts as a regulatory and control body for banking and financial sector organizations nationwide. BI tools have allowed:

  • The most significant performers to be viewed and listed.
  • The best performing branch of any state, region, or banking group to be identified in terms of deposits, assets, and credit growth.

Government revenue tracking - BI tools can help track the collection of revenue from various states. It can spot specific revenue-rich locations and identify potential growth areas.

RBI's business analysts, decision-makers, and policy-makers can use this automated information to carry out their respective activities.

BI is an ongoing process

RBI has created an internal project team, which actively guides the business users, on ways to use and benefit from the use of the tools. "The data model we had to build for our institution was unique, and was not based on an existing readymade model to follow," said Dr. Nag.

"We are on the learning curve and are evolving with time. More departments and users are catching on to the use of BI. This ongoing process will inject more and more value to our institution."

Understanding the most valuable asset
BPL mobile, one of the largest mobile telecom providers in India, has over 1.2 million customers nationwide, and rightly believes that its customers are the company's largest non-replicable asset. It uses BI tools to help deliver focussed services and generate better value from its existing subscriber base.

Using BI, the company can identify new business segments, cross-sell and up-sell services, identify user needs in particular segments, create retention strategies, and empower its business users with timely relevant information.

Blurring differentiation

Among the mobile telecom providers, aspects like products, tariffs, and network elements can be duplicated and offered easily by the competition. Other than voice, all mobile telco's in the market offer most of the services like SMS, MMS, GPRS, and WAP. The tariff structures are quite the same among the competition in most cities. If an operator reduces tariff, others are quick to follow. And since all telecom equipment-makers offer the latest technology, all mobile telecom operators are technologically up-to-date.

"We've come to a crossroad where the only long-term key business differentiator from other mobile telecom operators is customer service," explained Deepak Varma, Senior Vice President and Chief Operating Officer, BPL. "Since the customer is our most valuable asset, it makes perfect sense to understand this asset in detail."

“With BI tools we can look across usage tabs and identify potentially beneficial segments in a remarkably short time” Deepak Varma, Senior Vice President & Chief Operating Officer, BPL mobile

How does BPL differentiate?

The company has a strategic and philosophic organizational intent, called SLRP (Strategic Long Range Plan). From SLRP comes its Corporate strategic Objectives, and an annual operating plan. These strategies focus on the customers and aims to be the differentiating factor.

"We have to understand the customer, give them value, and build a long-term relationship. Since communication is a product needed by a cross-section of society, the customer can enhance his/her quality of life with it. So why don't we use tools and applications that will make the use of our service more meaningful to our customers," said Varma.

Customer needs

BPL mobile's customers are from a vast cross-section of society. They may be travelling businessmen, busy executives, academics, housewives, and students. The idea is to understand their needs.

The needs are varied.

  • Some subscribers prefer to control expenditure and hence use pre-paid cards.
  • Some subscribers have bill cycles on the first few days of every month but their salary cheques hit the banks in the first week, and takes four days to credit.
  • Many subscribers lose their handsets and may need to insure against this loss.
  • Some subscribers call a particular city very often.
  • College students generally call more in the evenings.

"If we can understand these needs from our database, we can give our subscribers more value. This way we will optimize and maximize returns from these customers," said Varma.

The BI in BPL mobile

The company uses BI tools from SAS to help perform customer asset management. Customer needs are tapped at various touch points and put into a warehouse. The BI tools are able to identify sections, pick up sub sections, and provide cross-tab information/data.

"With these tools we can look across usage tabs and identify potentially beneficial segments in a remarkably short time. The marketing and sales teams can pro-actively create the necessary strategies and execute the same. Cross-selling beco-mes easy, and up-selling becomes a win-win proposition," said Varma.

The BI tools provide information about subscriber calling behavior, usage pattern, payment patterns, and history of his/her getting in touch with the company. This behavior pattern is matched with other subscribers to identify potential voluntary or involuntary turnover (churn).

On inter-operability Mr. Varma said that, the company uses business applications like the billing engine from Schlumberger Sema, called the BSCS, and a financial package from Oracle. These have not presented any integration problems.

Specific benefits

Here are some specific benefits that the BI tools have created for the company and its customers.

In Tamil Nadu, a number of people called their contacts in Chennai, which is in a separate license circle. These users called up their business associates, children, parents, and friends. BI tools helped identify this behavior and now the company offers a special scheme called 'Hello Chennai.' Users in Tamil Nadu can pay a nominal charge every month and can call Chennai at local call rates.

The BI tools also helped identify a segment of users who wanted to switch off their phones when they did not have a need to call. The use of voicemail service was also perceived to be expensive. As a solution, the company looked for a system to alert the user in case of a missed call. BPL mobile tied up with Sabir Bhatia's Navin Mail for a product, which gave, combined voicemail and alert services. It was ideal for those persons in a meeting or for those travelling outside their networks, who wanted to know who called while they were busy.

Coimbatore has a large number of gold and jewelry traders who called Mumbai every night to find out the current rates and prices of gold. This would help them plan the next day's purchases and sales. In a quick survey, one such trader who was calling Mumbai regularly was asked why he preferred to do so. On understanding his behavior, the BI tools were able to identify others showing the same usage pattern. BPL mobile started a service targeted exclusively at this segment of traders.

BPL mobile has relationship teams, which look after corporate and platinum customers. These customers provide high usage and are classified as 'Platinum customers' numbering around 32,000. BI tools can identify which of these customers use a particular service regularly and which ones don't, although they may be in the same segment. They can now be grouped into sub-segments and the low users of a particular service can be targeted with awareness campaigns.

Strategic intent

"The BI tools can bisect and dissect data and information like customer usage, behavior, and calling patterns. It can give it to us in cross-segments and cross-tabs, allows us to look at it, and make strategies on how our subscribers and we can benefit from a particular insight," explained Varma.

The company knew that such segments and sub-segments did exist, but did not know how large they were and whether they were profitable. Without BI, it would have taken a long time to get the relevant data from the systems. And by the time a business user could identify a behavior, it would perhaps be too late for the opportunity. These benefits fit very well with the strategic intent of the organization.

Making new partnerships

BPL mobile launched a product called Mobile Security in Pune. BI tools identified a base of 20 percent users who would like to insure their handsets. So the company made a strategy to protect its

It tied up with Bajaj Allianz and provided customers three types of policies at nominal rates. One of them offers Rs.10, 000 as handset insurance in case of loss with no questions asked, and accident insurance cover of Rs. One Lakh, in case of death. This policy comes at an annual premium of Rupees 200 a year. The other two offer a combination of these and hospitalization cover.

The customer needed security, BPL mobile needed to serve its customers better, and a third party (Bajaj Allianz) needed to create more customers. All three entities benefit from this partnership. The insurance company benefited from a ready set of worthy customers, the user benefited from insurance at low rates, and BPL mobile benefited from better customer service.

The company offers a BPL Mobile - ICICI Bank co-branded credit card, because it identified a need among many users of having more payment options including the one of 'rolling' their money. Here, the third party (ICICI Bank) wanted more credit-worthy subscribers for its credit cards business, the users fulfilled a need, and the company won customer satisfaction. Currently BPL mobile has, over 48,000 subscribers who use this co-branded credit card.

BI screenshot at BPL mobile

Making good BI

The company took utmost care in strategizing & implementing the BI project to ensure the best possible returns.

Before purchasing the solution, Mr.Varma had asked the vendor for a 'proof of concept'. This can be explained with an example. Findings from a BI tool should provide actionable and relevant data. The BI tool shouldn't churn out data that is voluminous and irrelevant. It should list the most probable cases for up-sell, cross sell, or turnover. It should help the operating teams with a focused list that can help them act on a cost effective manner. The vendor agreed to deliver the desired 'proof of concept'. Markets and environments change. To keep pace, a company must re-train its knowledge. The BI tool and the data warehouse are trained and re-trained dynamically so that it's ready to provide intelligence for tomorrow.

"Re-training is very critical, because the environment is evolving. Subscriber behavior and the regulatory environment are changing. Competition is making the market change and new information is pouring in. If we don't regularly update new market information into the tools, optimum results can't be obtained," said Deepak.

Relevant data makes happy business
Kisan Ratilal Choksey Shares & Securities (KRCSS), a financial service and broking house with over 14,000 customers needed to introduce a number of positive developments in the organization.

It needed to enable informed decision-making by eliminating hunch-based decisions; enhance communication and joint planning across functions and lines of business; and respond more quickly to changes in financial conditions, customer preferences, and supply chain operations.

It deployed Business Intelli-gence (BI) tools and can now make timely risk management, payments, and delivery decisions. It has increased efficiency in its working environment and introduced a simple and effective decision-making system. The solution provides online alerts and comprehensive user access to relevant data across the organization.

"Our capacity to handle business has increased three-fold since we started using BI tools. We also did not need to add any new manpower to support the resulting business growth," said Deven Choksey, Managing Director, KRCSS.

“The BI solution would integrate various data sources and centralized maintenance and administration” Deven Choksey, Managing Director, KRCSS

Staying ahead in the game

The company provides financial solutions to high net-worth individuals, corporates, and NRIs. It provides services like broking, depository, insurance, fixed income, e-trading, and equity research. It publishes around 900 research reports every year and has extended most of these services to the Web. Timely and relevant information is a compulsory requirement for the company to stay ahead of competition and exploit existing and new business opportunities.

KRCSS observed that between 1995 and 2000, events like deregulation and restructuring of financial markets, had introduced a few trends into financial services companies. The trends were:

  • Globalization and consolidation.
  • Complexity in go-to-market strategies.
  • Explosion in data availability.
  • The need for more sophisticated customer understanding.

Financial organizations today

Financial services and broking organizations have to deal with more complex environments due to globalization and consolidation of markets. And the need to manage complex product/service portfolios for a growing number of customers has resulted in an explosion in the amount of data. Organizations have to make business sense from a very broad range of customer activity and respond accordingly.

"In order to face this growing set of challenges, we required a BI solution that would allow shared and defined access to relevant information. The solution would integrate various data sources and offer centralized maintenance and administration. This would enable our account teams, risk and relationship managers, and others interacting with customers manage the wide range of products and services offered in increasingly widening geographical frontiers," explained Deven.

The BI solution and the benefits

The company deployed Computer Associates' CleverPath Forest & Trees, and chose Pranali Consultants to design, develop and implement the BI applications. It provided the following solution components and benefits:

Performance Monitoring and Analysis: Performance monitoring helps the company to monitor the entire business as a whole with graphical and tabular views of information. It offers easy drill-downs to details for proper assessment. It helps assess and identify cross-selling opportunities. Targets and past performance are monitored with the help of KPIs.

The exception, violation and threshold indicators are displayed so that decision-makers can focus on such indicators and manage by exceptions.

Risk Monitoring: KRCSS looks at risk management in two dimensions. First, in relation to the client on whose behalf the transactions are entered. And second, with respect to the exchange.

In order to control the above risks this BI module monitors aspects like: -

  • Mark to Market positions of each client by scrip for a settlement.
  • Client-wise margin deposits, bank guarantees, and exposure utilized.
  • Client-wise ledger balance and clear balance.
  • Share delivery discrepancies from depository transactions.

Alerts are generated based on preset business rules. Tickers are used to display the urgency of management attention and the scale of violation or risk.

CRM: This module allows analysis of active, inactive, and new customers; displays customer involvement by product/segment; and can make ad-hoc queries to the customer database.

Performance Monitoring: This module provides a comprehensive measurement of sales performance at a group and an individual level. It compiles a complete 'sales profile', which includes KPIs to monitor individuals' targets, initiatives, dependencies, risk parameters, costs, and benchmarks. Star performers and average performers can be easily identified based on performance parameters.

Profitability Analysis: This module allows to track profit, compare profit/costs, analyze costs and assess critical trends in cost in relation to organization, division, location, profit-center, and business segment.

Financial Statements and Schedules: This module generates financial statements along with the corresponding schedules as required by the accounting standards. Comparison with previous years' performance is presented in tabular and graphical forms to enhance subjective analysis and judgment.

Accounts and Operations: This module helps to generate reports to be printed and circulated based on user-specific needs. Some of the key reports cover areas of financial analysis, sector analysis, trades, turnover by client segment, and refund due.

Internet Services: This module allows reports and graphs to be broadcasted to customers or employees as e-mail or predefined HTML templates.

Harvesting BI benefits

"Technology is important to an organization. But the relevance of the technology to an industry's environment is just as crucial. The combination of functional requirements and technology when collectively defined, implemented correctly and effectively utilized will create a competitive advantage for the organization," said Deven.

"BI has provided us an information retrieval system that helps our agents provide customers with data they couldn't see before. The flexibility of the solution can provide customers a wide range of customized reports. This has resulted in greater customer satisfaction. The managers can devote more time in planning and consulting instead of the various tasks previously associated with creating reports. It is a big change as we find more time to do business with greater surety of the decision taken."

Soutiman Das Gupta can be reached at

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