An Event Driven Approach to Customer Relationship Management in e-Brokerage Industry
description
Transcript of An Event Driven Approach to Customer Relationship Management in e-Brokerage Industry
HICSS36-ECCRM-1
An Event Driven Approach to Customer Relationship
Management in e-Brokerage Industry
Dickson K.W. CHIUWesley C. W. Chan
Gary K. W. LamFranklin T. Luk
Dept. of Computer Science & Engineering,
Chinese University of Hong Kong
[email protected], [email protected],
[email protected], [email protected]
Shing-Chi CHEUNG
Dept. of Computer Science
Hong Kong University of Science & Technology
HICSS36-ECCRM-2
Introduction and Motivation CRM
Helps a firm to streamline customer services Centralize its customers data for analysis purposes Critical to the success of a business
Most recent CRM work Concentrate on data mining Construction of customer behavior models
This paper Turns knowledge into business action Carry out appropriate actions effectively and efficiently Detailed system architectures Implementation methodologies for CRM activities
enactment “Event-driven approach”
HICSS36-ECCRM-3
Event-driven Approach Motivated by the active
database paradigm Event - occurrence of
something interesting to the system itself or to user applications
Event driven execution of rules in event-condition-action (ECA) form
ECA (active) rules: On event if condition then action
Exceptions and alerts are events too (action = handler)
Ensure efficiency and timeliness
Business Events
Client Events
Brokerage’s Events
Environment
Order Placement
Complaints
Service Exceptions
Change ofPersonal Profile
Staff Turnover
ServiceChange
Market News
Stock PriceChange
HICSS36-ECCRM-4
Brokerage Industry in Hong Kong Has high potentials in collecting valuable client
information (HKSFC requirement) - brokerage must keep client transaction records for 5 years
little room to increase its revenue through cross- or up-sale trading
Changes in industry Endorsement of removal of minimum commission rule Extension of trading hours of stocks and futures Tightened requirements of liquid capital for margin
trade loan – CRM for risk management
HICSS36-ECCRM-5
SME Brokerage in Hong Kong Most are SME firms (therefore our target of
study) Competition from big firms and banks
- drop of market share from 23.01% to 19.04%. Reduce operational cost Increase revenue Reduce client attrition rate Move to e-commerce Internet platforms Become more robust and cope with the changes retain existing clients and to increase their
satisfaction through effective coordination and enactment of CRM activities
HICSS36-ECCRM-6
An Event Driven Approach to CRM
Data Warehouse
Active RuleEngine
Analytical Engine
Environment Listener
market data
Client
Broker
Manager
CRM SystemManagerial
Application
CallCenter
Front-end
Back-end
ClientPortal
Internet Alert
Sender
ICQ / email / SMS
HICSS36-ECCRM-7
Heart - Active Rule Engine
Separate the active rule engine from the analytic engine
Knowledge discovery in the analytic engine is resource intensive and computational expensive
Triggering events from external sources - detected by the environment listener, the analytical engine or user input from the front-end subsystems
Time events generated by the system clock helps tracking deadlines (e.g., payment due dates)
HICSS36-ECCRM-8
Backend - Data Warehouse
Oracle 8.1.7 Database Server on a Windows 2000 Server platform For Online Analytic Processing (OLAP) Client transaction and holding records retrieved from OLTP system
HICSS36-ECCRM-9
Backend - Analytic Engine
Important changes or alerts are detected, these events will be forwarded to the active rule engine for processing
Client Value Estimation - expected profit from a client (Domingos and Richardson)
Client Attrition Alert - account balance, statistical behaviors Client Risk Analysis - related to margin trade Client Segmentation - transaction amount, frequency,
recency, stock type, risk shouldering and other demographic data
Client Channel Analysis - trend of client contact channel and specifically for web presence by studying clients’ click-through
Marketing Campaign Analysis - studies the successfulness of a marketing campaign
Key Performance Indicator (KPI) measurement
HICSS36-ECCRM-10
Backend - Environment Listener
Input from different market and news data sources E.g., Reuter’s services via Java Message Service
(publish-and-subscribe mechanism) Relevant data are stored into the data warehouse for
later processing by the analytical engine or other retrieval purposes
Relevant events are passed to the active rule engine for processing.
Evaluation of several variables and of several values per variable
Related attributes can be evaluated similarly for speeding up (Cheung et al 2002)
Need to take in account of the dependencies among the issues
HICSS36-ECCRM-11
Rules triggered by events related to client behavior Event Condition Action
R1 Trade input (from client portal / broker call center)
Abnormal transaction amount
1. Alert client – cancel or continue2. Alert broker for attention
R2 Payment due(time event)
Payment unsettled 1. Notify client for payment or reduce holding2. Alert broker for attention
R3 Client withdraw cash (from client portal)
Withdraw amount exceed threshold
1. Alert broker for possibility of client attrition 2. Alert also the manager if important client
R4 Client withdraw cash (from client portal)
New account balance < unsettled payment
1. Remind client for payment 2. Alert broker for attention
R5 Complaints(from client portal / broker call center)
- 1. Record details in data warehouse2. Alert broker to handle (possibility of client
attrition)
HICSS36-ECCRM-12
Rules triggered by events related to client profile
Event Condition Action
R6 Client attrition alert(from analytic engine)
Valuable client 1. Alert broker for possibility of client attrition 2. Alert also the manager if important client
R7 Client change in segmentation (from analytic engine)
- 1. Alert broker for important clients2. Subscribe the client to new information sources and news3. Suggest cross-sale
R8 Client change interest (from client portal)
- 1. Alert broker for important clients2. Subscribe the client to new information sources and news3. Suggest cross-sale
HICSS36-ECCRM-13
Rules triggered by events related to the market environment
Event Condition Action
R9 Particular stock price change (from environment listener)
User-defined alert price met
Alert the clients
R10 News for particular stock arrived (from environment listener)
Send the news to the clients who have subscribed to the information of the stock
R11 Severe stock risk signal, e.g., total holding value drop by 10% (from analytic engine)
Margin clients 1. Notify client for payment or reduce holding2. Alert broker for attention
R12 Severe stock risk signal (from analytic engine)
Cash clients 1. Notify client (as service)2. Alert broker for attention for important clients
HICSS36-ECCRM-14
Rules triggered by events related to the brokerage firm
Event Condition Action
R13 Broker resignation (from managerial applications)
- 1. Notify affected clients about the change in broker for them
2. Alert the new responsible broker for attention for important clients
R14 Important news / changes in policy of the brokerage firm
(from managerial applications)
- Notify all clients and brokers
HICSS36-ECCRM-15
Front-end – Broker Call Center
Relevant alerts - notify the broker to carry out follow-up actions Demographical data, estimated trade limit, event logs Follow-up service activities, personalized recommendations Exploring cross-selling opportunities of stock derivatives Record clients’ complaints, common queries, special requests
HICSS36-ECCRM-16
Front-end – Managerial Application
Common reports with pre-defined queries / customized reports
Events and alerts related to high-valued clients directed to managers too
HICSS36-ECCRM-17
Front-end – Client Portal
Consistent style and usability instead of eye-catching effects
Avoid graphical and multimedia interactive contents
HICSS36-ECCRM-18
Lessons Learnt
Change of workflow and information management procedures
Should roll the online CRM web interface to the clients only after the CRM system’s operation has become smooth internally
Phased approach in system development and deployment
Verification of the required data from the legacy system is difficult and time-consuming
SME brokerages in Hong Kong are not quite familiar with advanced information technologies
HICSS36-ECCRM-19
Benefits of Event Driven Approach
Business rules, in general, can be naturally modeled as ECA rules, which can be used for activity enactment, monitoring and exception handling
Implemented with JMS or other contemporary technologies, such as Web services
Rules can be added to, deleted from and modified for a system more easily than traditional software development approaches
Business environment keeps changing, users expect new features or functionalities
Abandon of a pure artificial knowledge discovery approach - turning understanding into action is the key to deriving real benefits
HICSS36-ECCRM-20
Conclusions Pragmatic event driven approach to CRM for the e-Brokerage
industry Practical system architecture and a working prototype –
unified platform for automated actions and human expert attention
Discuss the use of different categories of business events from the clients, the firm and the market environment
Focus on efficient and timeliness of CRM activity enactment ECA-rule paradigm
systematic specification of handling asynchronous business events enables effective enactment of the specified handlers (actions) deliver the most appropriate care to clients
Suitable for implementing CRM system for other e-commerce sectors by turning knowledge into business actions
HICSS36-ECCRM-21
Future Work
Scale up CRM solution with J2EE Mobile CRM with J2ME Application in other service industries, e.g., insurance Integration with workflow management system B2B integration / Electronic Contracting
A Data-driven Methodology to Extending Workflows Across Organizations over the Internet (HICSS36)
An Architecture for E-Contract Enforcement in an E-service Environment (HICSS36)
On e-Negotiation of Unmatched Logrolling Views (HICSS36) Enterprise Document Management
A Watermarking Infrastructure for Enterprise Document Management (HICSS36)