Description
The report describes on application of SCM to the banking sector.
SCM IN BANKING SECTOR
1
PRESENTATION FLOW
Service Industry – Features ? SCM in Service Industry ? Banking Industry – Overview ? Problem Statement ? Objectives for FY2010 ? Retail Banking (Liquidity and Credit Management) ? Credit Card Delivery Mechanism ? Corporate Banking ? HNI Banking
?
2
UNIQUE FEATURES OF SERVICE INDUSTRY
? The
customer – a participant in the service process ? Simultaneous production and consumption
?
Perishability
? Limited
Scale Economies ? Labor Intensiveness ? Intangibility
3
SCM IN SERVICE INDUSTRY
Supplier Relationship Management
Source Negotiate Buy Design Collaboration
Integrated Supply Chain Management
Strategic Planning Demand Planning Supply Planning
Customer Relationship Management
Market Price Sell
Fulfillment
Field Service
Call Center Order Management
4
Supply Collaboration
BANKING INDUSTRY
• CASA Deposits • Wholesale Deposits
Intermediary Banks
• Cash Management • Credit Management
•Retail Credit (Secured and Unsecured) •Wholesale Credit •Non-interest income Customers - Gross Credit
Investors Aggregate Deposits
5
OVERVIEW OF THE BANKING SECTOR IN INDIA
Deposits
5.60% 3.00%
Gross Credit
5.50% 2.50%
17.10% 50.50% 23.80%
17.80% 50.50%
23.70%
Nationalized Banks SBI and Associates Other Scheduled Commercial Banks Foreign Banks Regional Rural Banks
Nationalized Bank SBI and Associates Other Scheduled Commercial Banks Foreign Banks Regional Rural Banks
6
SCM IN BANKING
7
PROBLEM STATEMENT
Vision – To be the No.1 Bank in India in terms of Aggregate Deposits and Gross Credit. ? Mission – To provide holistic banking services customized to each individual. ? Goal – To become a high performance bank in terms of CASA Deposits and Good Credit Portfolio. ? Problem Statement – Design SCM for executing strategy for FY2010 of ICICI Bank.
?
8
STRATEGY FOR FY2010 ICICI BANK
9
CURRENT SCM - M’S MANAGEMENT
?
Man Management
? ?
Depositors Customers mySAP for SRM Siebel for CRM
Suppliers (SRM)
Depositors Investors
?
Method Management
? ?
?
Material Management
Liquidity Management (BI Tool) ? Credit Management (Finnone)
?
Bank (ISCM)
Cash Management Credit Management Channel Management
?
Machine Management
Servers and Infrastructure ? Branches and Outlets
?
Products (CRM)
Credit Cards
Treasury Loans
Advisory Services
10
RETAIL BANKING
11
RETAIL BANKING
?
To increase CASA in comparison to Wholesale Deposit and increase low cost CASA
?
? ?
? ?
Strategic Location - Location in Tier II (Pune, Kolkatta, Hyderabad) and Tier III Cities (Jaipur, Ghaziabad, Kochi) Specific Targets - Focus on Small Time Traders and Working Class in Small Companies Technology Driven Products - Increase the amount of cashless transactions using Internet and Mobile Banking. Core Banking Solutions – It reduces customer turnaround time and provides anywhere banking. Marketing – Increase canvassing using technology in order to reduce cost of deposit acquisition.
12
13
RETAIL BANKING
?
To increase Capital Adequacy and reduce unsecured retail credit
? ?
?
?
Target Credit - Focus on secured credit and reduce high risk weighted assets. Increase Fee Based Income – Increase fee income from issuing Letter of Credit and Guarantee. Restructure Products – Reduce dependence on retail loans like Home and Car Loans and provide loans for Working Capital. Reduce Cost of Marketing – Approach clients with customized technology driven products.
14
CREDIT CARD SUPPLY CHAIN
15
JUST IN TIME SERVICES
Banks are more intimately linking their systems with the enterprise resource planning (ERP) systems of their clients ? Just-in-time financing arrangements ? As banks become more attuned to what's going on in clients' supply chains, they can make better financing decisions for them ? So instead of providing a general working capital loan, you can offer a transaction-by-transaction loan
?
16
PAPERLESS TRANSACTIONS
Banks are using SCM to further eliminate paper from the world of international trade ? Automation stops at the interface point between counterparties ? Banks are increasingly incorporating imaging and workflow engines, not paper and checks thereby reducing middlemen like courier service providers. ? This kind of real-time, actionable data availability is speeding up supply chains to get more transparency and visibility into them
?
17
PAYMENT HUBS
Provide clients with one view of all their transactions ? Clients can portal in and see which wires have cleared by going into an individual system ? EVOLVING PAYMENT METHODS
? ?
Transition from Letter of Credit to OPEN ACCOUNTING ? In this case, banks need only make the wire transfer. But this method places the onus on the buyer to examine the invoice information to make certain it is accurate. ? Banks are creating new Web applications to support a digital open account so the buyer and seller have visibility into the transaction
18
WHOLESALE BANKING
19
WHOLESALE OR CORPORATE BANKING
?
Products offered
? ? ? ?
Cash Management Services Capital Market Services Trade Services Trade Finance
20
WHOLESALE OR CORPORATE BANKING
21
WHOLESALE OR CORPORATE BANKING
?
Trade Services/ Trade Finance
22
WHOLESALE OR CORPORATE BANKING
?
Working Capital Management
23
WHOLESALE OR CORPORATE BANKING
24
HNI/ PRIVATE BANKING
25
HNI / PRIVATE BANKING
Personalized Attention: Dedicated Client Relationship Manager Private Banking Services (Doorstep Banking)
Exclusive Phone Banking and Internet Services Loans at Preferential Rates
Customised Business Solutions
Hassle - free Foreign Remittances
26
Waiver on a host of service charges
HNI / PRIVATE BANKING
RM approaches HNIsestablishes relationshi p
HNIs required to maintain a minimum monthly /quarterly balance
Designing of products based on HNI’s requirements. Management of their portfolios, by a dedicated Wealth Manager
Continuous Client Interaction and offering special privilegesWaiver of annual fees, banking charges, spec ial deals etc.
27
DISTRIBUTION STRATEGY
• Cross selling of products as a major area of focus
• Creation of concept of DSA (Direct Selling Agent) and DST (Direct Selling Team)
• Effort on the part of the bank to reach the customer rather than waiting for the customer • Use of internet, mobile, ATM’s and other technological device to reach and serve the customers
28
CROSS SELLING
Deposits Pvt. banking Credit card Debit cards Bonds Insurance Loans Mutual funds
Customer service & sales force automation
Campaign management solutions
Live data warehouse
Walk in customers
Private banking customers
Salary account customers
Corporate banking customers
29
TECHNOLOGY FOR CRM
CRM capability will be built on a “Teradata” data warehouse that integrates data from multiple sources, including the Oracle database and various flat files.
For enterprise intelligence, the bank will take on the end-to-end proposition of SAS which offers a credible integrated approach to analytics, including data detection, data cleansing, data preparation, reporting and business intelligence.
Lead management - The bank will build a lead management system which is able to allocate leads, schedule meetings, provide a record of all interactions with the customer, and give reminders for customer follow-ups.
A lead generation tool will also be used to capture and route product applications made over mobile phones.
30
RECENT PRACTICES IN THE BANKING SUPPLY CHAIN IN INDIA
?
Evolution of structured solutions in receivables management
?
Faster realisation at an economic cost for paperbased clearing, and possible elimination of paperbased practices ? Geographic coverage to match the customers’ presence, even if the bank is not physically present in the area ? Electronic receivables through RTGS, NEFT ? Interface with ERP for customised receivables reporting
31
RECENT PRACTICES IN THE BANKING SUPPLY CHAIN IN INDIA
?
Banking process outsourcing – Processes used by companies to improve their receivables management
32
RECENT PRACTICES IN THE BANKING SUPPLY CHAIN IN INDIA
?
Banking process outsourcing – Cheque warehousing and management, bilateral direct debit arrangement
33
RECENT PRACTICES IN THE BANKING SUPPLY CHAIN IN INDIA
?
Banking process outsourcing – Virtual accounts for electronic receivables
34
RECENT PRACTICES IN THE BANKING SUPPLY CHAIN IN INDIA
?
Supply Chain Financing ? Consequence of recession around the globe ? Banks provide integrated financial products for all partners in a company’s supply chain
Dealer Financing – Exclusive financing facility to the dealers or distributors of a particular corporate Factoring of Receivables - Purchase of accounts receivable at a discount - enables better cash management for the seller. Purchase Invoice Financing or Vendor Financing - Provide financing to vendors of a particular corporate against sales made to the corporate. Warehouse Financing - Goods are held in trust as collateral for the loan Rent Receivable Financing - For companies involved in renting out goods like computer hardware, etc to other companies. Cross Border Transactions - Products for providing supply chain financing solutions to corporates involved in international transactions.
? ? ?
?
?
?
35
REFERENCES
?
ICICI Web Site
?
?
http://www.icicibank.com/aboutus/invest-relations.html http://www.icicibank.com/aboutus/invest-relations.html
?
RBI Web Site
? ?
http://rbidocs.rbi.org.in/rdocs/Publications/PDFs/SEQ150110_F.pdf http://rbidocs.rbi.org.in/rdocs/Publications/PDFs/STRB200809_Full.pdf
?
SCM Concepts and Cases – Rahul Altekar
?
http://books.google.com/books?id=orimz5E6IO4C&pg=PA165&dq=scm+in+service+industry&l r=&as_brr=3&cd=21#v=onepage&q=scm%20in%20service%20industry&f=false
?
Banking Concepts
? ?
http://www.ey.com/Media/vwLUImages/Assurance_XBRLHow_Can_It_Be_Used/$FILE/imap_banks_465w.jpg http://www.indianground.com/upcoming-cities.aspx
36
THANK YOU
37
doc_890825463.pdf
The report describes on application of SCM to the banking sector.
SCM IN BANKING SECTOR
1
PRESENTATION FLOW
Service Industry – Features ? SCM in Service Industry ? Banking Industry – Overview ? Problem Statement ? Objectives for FY2010 ? Retail Banking (Liquidity and Credit Management) ? Credit Card Delivery Mechanism ? Corporate Banking ? HNI Banking
?
2
UNIQUE FEATURES OF SERVICE INDUSTRY
? The
customer – a participant in the service process ? Simultaneous production and consumption
?
Perishability
? Limited
Scale Economies ? Labor Intensiveness ? Intangibility
3
SCM IN SERVICE INDUSTRY
Supplier Relationship Management
Source Negotiate Buy Design Collaboration
Integrated Supply Chain Management
Strategic Planning Demand Planning Supply Planning
Customer Relationship Management
Market Price Sell
Fulfillment
Field Service
Call Center Order Management
4
Supply Collaboration
BANKING INDUSTRY
• CASA Deposits • Wholesale Deposits
Intermediary Banks
• Cash Management • Credit Management
•Retail Credit (Secured and Unsecured) •Wholesale Credit •Non-interest income Customers - Gross Credit
Investors Aggregate Deposits
5
OVERVIEW OF THE BANKING SECTOR IN INDIA
Deposits
5.60% 3.00%
Gross Credit
5.50% 2.50%
17.10% 50.50% 23.80%
17.80% 50.50%
23.70%
Nationalized Banks SBI and Associates Other Scheduled Commercial Banks Foreign Banks Regional Rural Banks
Nationalized Bank SBI and Associates Other Scheduled Commercial Banks Foreign Banks Regional Rural Banks
6
SCM IN BANKING
7
PROBLEM STATEMENT
Vision – To be the No.1 Bank in India in terms of Aggregate Deposits and Gross Credit. ? Mission – To provide holistic banking services customized to each individual. ? Goal – To become a high performance bank in terms of CASA Deposits and Good Credit Portfolio. ? Problem Statement – Design SCM for executing strategy for FY2010 of ICICI Bank.
?
8
STRATEGY FOR FY2010 ICICI BANK
9
CURRENT SCM - M’S MANAGEMENT
?
Man Management
? ?
Depositors Customers mySAP for SRM Siebel for CRM
Suppliers (SRM)
Depositors Investors
?
Method Management
? ?
?
Material Management
Liquidity Management (BI Tool) ? Credit Management (Finnone)
?
Bank (ISCM)
Cash Management Credit Management Channel Management
?
Machine Management
Servers and Infrastructure ? Branches and Outlets
?
Products (CRM)
Credit Cards
Treasury Loans
Advisory Services
10
RETAIL BANKING
11
RETAIL BANKING
?
To increase CASA in comparison to Wholesale Deposit and increase low cost CASA
?
? ?
? ?
Strategic Location - Location in Tier II (Pune, Kolkatta, Hyderabad) and Tier III Cities (Jaipur, Ghaziabad, Kochi) Specific Targets - Focus on Small Time Traders and Working Class in Small Companies Technology Driven Products - Increase the amount of cashless transactions using Internet and Mobile Banking. Core Banking Solutions – It reduces customer turnaround time and provides anywhere banking. Marketing – Increase canvassing using technology in order to reduce cost of deposit acquisition.
12
13
RETAIL BANKING
?
To increase Capital Adequacy and reduce unsecured retail credit
? ?
?
?
Target Credit - Focus on secured credit and reduce high risk weighted assets. Increase Fee Based Income – Increase fee income from issuing Letter of Credit and Guarantee. Restructure Products – Reduce dependence on retail loans like Home and Car Loans and provide loans for Working Capital. Reduce Cost of Marketing – Approach clients with customized technology driven products.
14
CREDIT CARD SUPPLY CHAIN
15
JUST IN TIME SERVICES
Banks are more intimately linking their systems with the enterprise resource planning (ERP) systems of their clients ? Just-in-time financing arrangements ? As banks become more attuned to what's going on in clients' supply chains, they can make better financing decisions for them ? So instead of providing a general working capital loan, you can offer a transaction-by-transaction loan
?
16
PAPERLESS TRANSACTIONS
Banks are using SCM to further eliminate paper from the world of international trade ? Automation stops at the interface point between counterparties ? Banks are increasingly incorporating imaging and workflow engines, not paper and checks thereby reducing middlemen like courier service providers. ? This kind of real-time, actionable data availability is speeding up supply chains to get more transparency and visibility into them
?
17
PAYMENT HUBS
Provide clients with one view of all their transactions ? Clients can portal in and see which wires have cleared by going into an individual system ? EVOLVING PAYMENT METHODS
? ?
Transition from Letter of Credit to OPEN ACCOUNTING ? In this case, banks need only make the wire transfer. But this method places the onus on the buyer to examine the invoice information to make certain it is accurate. ? Banks are creating new Web applications to support a digital open account so the buyer and seller have visibility into the transaction
18
WHOLESALE BANKING
19
WHOLESALE OR CORPORATE BANKING
?
Products offered
? ? ? ?
Cash Management Services Capital Market Services Trade Services Trade Finance
20
WHOLESALE OR CORPORATE BANKING
21
WHOLESALE OR CORPORATE BANKING
?
Trade Services/ Trade Finance
22
WHOLESALE OR CORPORATE BANKING
?
Working Capital Management
23
WHOLESALE OR CORPORATE BANKING
24
HNI/ PRIVATE BANKING
25
HNI / PRIVATE BANKING
Personalized Attention: Dedicated Client Relationship Manager Private Banking Services (Doorstep Banking)
Exclusive Phone Banking and Internet Services Loans at Preferential Rates
Customised Business Solutions
Hassle - free Foreign Remittances
26
Waiver on a host of service charges
HNI / PRIVATE BANKING
RM approaches HNIsestablishes relationshi p
HNIs required to maintain a minimum monthly /quarterly balance
Designing of products based on HNI’s requirements. Management of their portfolios, by a dedicated Wealth Manager
Continuous Client Interaction and offering special privilegesWaiver of annual fees, banking charges, spec ial deals etc.
27
DISTRIBUTION STRATEGY
• Cross selling of products as a major area of focus
• Creation of concept of DSA (Direct Selling Agent) and DST (Direct Selling Team)
• Effort on the part of the bank to reach the customer rather than waiting for the customer • Use of internet, mobile, ATM’s and other technological device to reach and serve the customers
28
CROSS SELLING
Deposits Pvt. banking Credit card Debit cards Bonds Insurance Loans Mutual funds
Customer service & sales force automation
Campaign management solutions
Live data warehouse
Walk in customers
Private banking customers
Salary account customers
Corporate banking customers
29
TECHNOLOGY FOR CRM
CRM capability will be built on a “Teradata” data warehouse that integrates data from multiple sources, including the Oracle database and various flat files.
For enterprise intelligence, the bank will take on the end-to-end proposition of SAS which offers a credible integrated approach to analytics, including data detection, data cleansing, data preparation, reporting and business intelligence.
Lead management - The bank will build a lead management system which is able to allocate leads, schedule meetings, provide a record of all interactions with the customer, and give reminders for customer follow-ups.
A lead generation tool will also be used to capture and route product applications made over mobile phones.
30
RECENT PRACTICES IN THE BANKING SUPPLY CHAIN IN INDIA
?
Evolution of structured solutions in receivables management
?
Faster realisation at an economic cost for paperbased clearing, and possible elimination of paperbased practices ? Geographic coverage to match the customers’ presence, even if the bank is not physically present in the area ? Electronic receivables through RTGS, NEFT ? Interface with ERP for customised receivables reporting
31
RECENT PRACTICES IN THE BANKING SUPPLY CHAIN IN INDIA
?
Banking process outsourcing – Processes used by companies to improve their receivables management
32
RECENT PRACTICES IN THE BANKING SUPPLY CHAIN IN INDIA
?
Banking process outsourcing – Cheque warehousing and management, bilateral direct debit arrangement
33
RECENT PRACTICES IN THE BANKING SUPPLY CHAIN IN INDIA
?
Banking process outsourcing – Virtual accounts for electronic receivables
34
RECENT PRACTICES IN THE BANKING SUPPLY CHAIN IN INDIA
?
Supply Chain Financing ? Consequence of recession around the globe ? Banks provide integrated financial products for all partners in a company’s supply chain
Dealer Financing – Exclusive financing facility to the dealers or distributors of a particular corporate Factoring of Receivables - Purchase of accounts receivable at a discount - enables better cash management for the seller. Purchase Invoice Financing or Vendor Financing - Provide financing to vendors of a particular corporate against sales made to the corporate. Warehouse Financing - Goods are held in trust as collateral for the loan Rent Receivable Financing - For companies involved in renting out goods like computer hardware, etc to other companies. Cross Border Transactions - Products for providing supply chain financing solutions to corporates involved in international transactions.
? ? ?
?
?
?
35
REFERENCES
?
ICICI Web Site
?
?
http://www.icicibank.com/aboutus/invest-relations.html http://www.icicibank.com/aboutus/invest-relations.html
?
RBI Web Site
? ?
http://rbidocs.rbi.org.in/rdocs/Publications/PDFs/SEQ150110_F.pdf http://rbidocs.rbi.org.in/rdocs/Publications/PDFs/STRB200809_Full.pdf
?
SCM Concepts and Cases – Rahul Altekar
?
http://books.google.com/books?id=orimz5E6IO4C&pg=PA165&dq=scm+in+service+industry&l r=&as_brr=3&cd=21#v=onepage&q=scm%20in%20service%20industry&f=false
?
Banking Concepts
? ?
http://www.ey.com/Media/vwLUImages/Assurance_XBRLHow_Can_It_Be_Used/$FILE/imap_banks_465w.jpg http://www.indianground.com/upcoming-cities.aspx
36
THANK YOU
37
doc_890825463.pdf