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1. What is Analytics?
2. IBM Analytics
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Analytics is defined by various people in different ways
Reporting / MIS?
Statistics?
OperationsResearch?
DatabaseMarketing?
Optimization?
Programs /Campaigns?
DataManagement?
PredictiveModeling?
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We define analytics as follows:
“…driving business resultsthrough the study of business data usingmathematical and statistical analysis
for decision-making ”
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1. What is Analytics?
2. IBM Analytics
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7 + +INSTRUMENTED INTERCONNECTED INTELLIGENT
“IBM s Smarter Planet agenda has analytics at its core,making it the industry's most comprehensive vision
for the future direction of business analytics…”
Dynamic InfrastructureSmart Work
New Intelligence Green & Beyond
SMARTER PLANETWITH ANALYTICS
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Analytics value proposition is focused ondelivering business results using customer data
Domain expertise &knowledge of industry
and client-specificbusiness challenges
Integrated approachcombining all
components required todeliver results
Global deliverycapability with a hybridon-site & offsite model
Technology agnosticmodel to ensure easy
adaptation andflexibility
Business resultsto the client and
quick time tomarket
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IBM s capabilities exist along the entire Analytics value curvedriving different business benefits
Data ManagementETL – Consolidation of data
BenchmarkingKey Performance Indicators (KPIs) / SLA s agreed upon by stakeholders
Advanced AnalyticsSegmentation, Predictive modeling and Optimization
Time and Resources
Value andImpact
AnalysisMulti-dimensional analysis so one can “slice and dice”
Basic ReportingRegulatory reporting that is reasonably automated
Smarter DataManagement
SmarterReporting
SmarterPerformanceManagement
SmarterInsights
SmarterBusiness
Impact
Efficiency
Effectiveness
BusinessImpact
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Our Differentiator…Smarter Way of doing analytics
Traditional Analytics
IBM Assets
IBM
INTEGRATEDANALYTICS …
CombiningTraditional &Asset-Based
AnalyticsIBM Market
Intelligence Group
IBM ClientBusiness Value
Group
IBM ResearchLabs
IBM Centre forBusiness
Optimization
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Our recent acquisitions have further strengthened IBM s AnalyticsCapabilities
Market Leader as the PredictiveAnalytics Software
SPSS Software has capabilitiesto build Analytical Solutions for
– Customer Profitability
– Customer Acquisition andRetention
– Demand Forecasting
– Employee Hiring and Retention
– Fraud Detection …
Redpill Solutions is a boutiqueanalytics firm
The firm specializes in – End to End Customer
Management Services
– Strategy related services like „Go -To Market Strategy , based onCustomer Research andInnovation for new customertrends
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To deliver an improved out put
DataManagement
Reporting
Benchmarking
Analysis
AdvancedAnalytics
Complex, One-OffProblem Analysis
CognosBI Tool
OAEText Mining Tool
SIMPLEPatent Analytics
LinkageDiscoveryVoice Analytics
DatastageData Management
TABIAccelerated BI
DIOSInventory
Optimization
COBRAWeb Analytics
SNOWSC Network
Optimization
SPSS RedPill
Research/ CBOSpecialized Tools
FAMSClaims Tool
CELMMarketingOptimization
... and many more
Tool & Service
Assets
Tool-based
Assets
Assets
F u n c
t i o n a
l C a p a b
i l i t i e s
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Acquisition
Segmentation
Portfolio Management
IVR Analytics
Churn Management
Customer Management
Analytics
Finance & Administration Analytics
Human Resources Analytics
Supply ChainManagement
Analytics
Industry Specific Analytics
Reporting
Risk Management
SpendManagement
…Spanning different problem areas across industries
Customer profiling to identify right set of customers for targeted campaigns
Devising customer acquisition strategies and developing customized offerings based on analysis ofinternal / external data
Screen out ‘bad customers’ during acquisition process through Predictive modeling
Analytics-led Cross-sell campaigns to derive maximum value out off the current customer base
Reporting & Analysis around IVR Effectiveness to assess Customer Experience and identifyingmarketing opportunities
Understanding business drivers for churn and accordingly devising retention strategies for proactively retaining high-value customers
Manage risks across customer lifecycle using application / behavior scorecards
Comprehensive spending profile enabling negotiations with the supply market, and driving bottomline savings
Web / Portal analytics to facilitate customer analysis, increasing traffic and enhancing conversions
Suite of End-to-End reporting and dash boarding solutions to drive quick and effective decision-making
Web Analytics
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Illustrative Examples on Solutions *
* - Partial List
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Attrition Management : Proactively retain potentially high valuecustomer s through attrition scorecard & strategy
Identify customers to be retained by the bankthrough profitability estimates
Results in decrease in attrition as well as
increase in revenues
2
4
A decision tree / scorecard to predict thecustomer base who are likely to attrite
1
Devise retention strategies for the selectedcustomer base (who may attrite)3
Customerbehavior &
productholdingpatterns
Cross- sellModel
Top- upPropensity
model
Check with bankofficers
30%decrease inAttrition
$ 50KincreaseinRevenues/ Program
19 nodes
• Amount of Credit/ Amount of debit(last 3 months)
• Principal Paid ratio• Disbursal Amount/
EMI• Worst DPD in last 6
months• …• …
7 Key Decision Variables Profits, USD/Customer
Best Worst
Decile
1 2 3 4 5 6 7 8 9 10
-350
-100-60-30-10100200
400
800
1,200
Most profitablecustomers
Customers who areover promoted with
no returns
Customers who can be allowed toattrite due to low returns
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Segmentation : Identify key segment opportunities by combining internaland external customer data
Results in market share gain & efficienttracking of performance
Estimate potential & design go to marketstrategy
M a r k e t D a t a
I n t e r n a l D
a t a
Customer segmentsin the market
Customer segmentswithin existingcustomer base
Ideal positioning
External Segments Internal Segments
W a l l e t s i z e
( m a r k e t )
W a l l e t s i z e
( c l i e n t s )
Yearly turnover
Expected $revenue / marketshare fromopportunity
How tocapture theopportunity
Opportunity
• Incremental marketshare
• Incremental revenue• Cash flows
• Segments strategy• Mktg & Dist Strategy• Campaigns &
promotions• Focus on analytics to
balance risk
Ideal positioning
Targets tied to estimated marketshare gainHigher market shareIncreased stickiness
Identify and profile market & internalcustomer segments
Map internal segments to market toidentify opportunity & ideal positioning
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Cross-sell/up-sell : Cross- sell relevant products to „good customersthrough the use of behavior score-card and propensity models
Identify key attributes thatdetermine customers likely to
take x-sell / top-up offers
R
a n k
o r d e r e d
2Identify „good customers based on
behavior score
1
Example score-bands for a regional bank • Loan Tenor • Ever Top-up • Ratio of loan-balance
& loan disburse amount
• Loan balance • Vintage of customer • …
Same bank other
product owners
Partner companycustomers
Same bank cardowners
Find the customer baseyou want to run cross-sell
campaigns on
3
8%12%
18%
Bottom9th8th7th6th
4%
5th
6%
4th3rd2ndTop
46%
Deciles – withoutPredictive modeling
Modeleddata
76%
100%Rank ordercustomersbased on thepropensity torespond to thecampaign
Larger target base, with lower riskresulting in revenues and cost-
savings
Increased
Target Base
Reduced
„Bad rate
30K
0.6%
Before After
4
5
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Reporting & Automation Solution
People AnalystsTechniciansStatisticians
TechnologyCognos, Brio, Hyperion, BODatastageMS Excel / VBA, MS AccessSAS / SPSS
InfrastructureServers, StorageFirewall, Internet, etc.Softwares
Analysis Services
Calculation, Formatting,
Consolidation,Reconciliation of Data
Report Creation
Data Services
Data Extraction
Data cleansing andconsolidation
Automation Services
Ad-hoc Queries
Report Automation
Generation of Reports andGraphs
Hosting Services
Hardware
Software
Network
Benefits:Process Standardization leading to Sustainability and enhanced Efficiency
Easy Real-time Access and User-FriendlyDrill-up & Drill-down CapabilitiesMechanism to analyse and drive further insights enhancing Process Effectiveness
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Problems Addressed
Lack of visibility into what is beingpurchased across the entire companyBuying power is not fully exploitedSpend data not readily available and/or
accurate to support suppliermanagementMultiple specifications for commoditieswithin the same functionsPrices vary among same itemsSmall proportion of negotiable spend isunder agreement
A comprehensivespending profileenablesnegotiations withthe supplymarket, anddrives bottom-line savings
Identify datasources
Cleanse andconsolidate
data
CategorizeSpend
DeliverSpend
Analysis
Data required areusually found in amultitude ofrepositories andsystems.
Comprehensiveview of allexpenditures,including buyingLocations -entities, segment,business units
Categorizespend intohierarchicalgroups of goodsand services thatreflect supplymarket structure
Process
Spend split by – direct versus indirect
– capital expenditure versus expense – materials versus services
Spend profile by – Invoice type – Commodity/service by supplier – Commodity by division/operating unit and
buying location – Number of suppliers by commodity/service
Spend Analysis SolutionProvides an effective tool for consolidating company-wide data, establishing baselinesand anchoring strategic sourcing decisions.
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ObjectiveForecast Cash flow t + Xperiod based on historicalcollection performance trends
Data Requirement3 years daily cash received
Capacity utilized
BenefitEnables Operations team toidentify the gap betweenprojected cash collections andtarget
Forecast Cash Flow
ObjectiveQuantify and Develop plan toaddress the gap betweenprojected cash collectionsand target
Data RequirementCash Forecast & targets
BenefitEnables Operations team toproactively address anydeficit by prioritizingresources / segments
ObjectiveCategorize the customersbased on historical paymentbehavior
Data Requirement~ 3 years transactional levelpayment data at a customerlevel
BenefitEnables differential servicingstrategies from a
Contact Channel
Contact Frequency
ObjectiveImplement Collectiontreatment strategies
Data RequirementAccount level treatmentstrategies
Benefit
Increased Cash FlowImproved CollectionsefficiencyEnhanced CustomerSatisfaction
Lower Operating costs
Identify the gaps(projected and target) Segment Optimize Efforts
Increasing collection effectiveness without increasing operatingexpenses by adopting a “smarter” targeting strategy based on Customer risk scoring.
Business Objective Impact / Benefits
Improving cash collectionsReducing DSO
Improving agent performance
Collections Solution
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Thank You