Eastern European Bank uses Smart SOA to rebuild sales processes with the help of IBM solution

Eastern European bank uses Smart SOA to rebuild sales processes









Founded in 1929, a large Eastern European bank today provides services to 5 million clients, including more than 250 thousand small and medium-sized enterprises and more than 15 thousand corporate clients. Shortly after opening its doors, the bank established international branches to serve customers living abroad, which helped it to maintain key international relationships and a degree of independence during the period of Communist rule. Quickly after reform of the country's banking system in 1989, the bank pursued a strategy to provide a full range of retail and corporate and investment banking services. The bank’s success and international growth, including a series of mergers and joint ventures, eventually led to its joining a European multinational banking network, where it continues to grow.

With the increasingly competitive international market for financial services, the bank seeks to continually optimize its operations and improve its business results. In 2008, the focus turned to its customer service and sales processes, which were not well monitored. For example, the bank had no data on sales results below the branch level, so it could not tell which individual sales representatives were performing well and which were not.

To maintain and grow its competitive edge, the bank needed to treat every customer contact as a potential sales opportunity, generate new revenue through targeted, well-managed sales campaigns, focus special action on retaining profitable customers, and transform sales and service into a streamlined, measured, optimized process.

Using BPM to drive the process

The bank’s vision was to move from an ad hoc, uncontrolled, passively monitored sales process to a closed-loop, monitored, measured sales process with clearly defined sales targets and closely managed sales campaigns.

Detailed results against the multilevel targets then would allow the bank to focus management attention as needed. If one product had consistently low sales across regions and representatives, the bank could examine the competitiveness of the product. If a particular representative’s or sales manager’s results were high or low, the bank could assess the differences and disseminate best practices or implement counseling measures as appropriate.

Effective implementation of the bank’s vision required that the process be codified and implemented into a new solution. If it were done the old way, with the process hard wired into the application, the process would be difficult and expensive to change. In addition, the bank would have to embed custom-built functions into the application to capture and report on the progress, status and results of the process. The bank chose instead to build the new sales system using business process management (BPM) technology and let BPM drive the process. This way, the bank could let the BPM system report on process status and metrics and more easily change the new sales system immediately as it identified process improvements.

Planning and achieving better results

At the beginning of each quarter, the bank establishes sales targets by product and by customer group (e.g., mass market, affluent, high net worth). After the targets are allocated down to the individual level, sales representatives examine their specific success ratios to determine how many sales contacts they will need to make to achieve their targets.

In the sales execution stage, the new sales systems plans sales contacts for all sales representatives and maintains their calendars. Before sales contacts, the sales system prepares the sales representatives with 360-degree views of the customers including detailed models of customers’ risk and future retirement benefits in multiple countries. The sales system also controls exception workflows. When a customer’s credit score is too low to automatically approve a product, a highly skilled representative can manually approve it or escalate the decision to a manager. After the contact, the sales representative declares whether it was successful or not. BPM then confirms each representative’s sales-success declarations via a back-end reconciliation process driven by sales activity recorded in the bank’s core financial services applications, which matches actual recorded sales with each representative’s sales declarations.

Analysis of the sales system’s detailed reporting—both of sales results and BPM-based process execution—allows a wide range of possible improvements. The data may show a consistent problem with a given product. It may show that one version of a process step works better than another. It may identify high-performing or low-performing representatives, managers, branches or regions.

If the improvement is a process change, many changes can be directly configured and implemented quickly using the sales system’s BPM features.

Changing behaviors

SOA provides a critical foundation for the sales system by enabling a clear, clean and readily managed interface between the core sales process delivered by the sales system and all of the bank’s existing applications. IBM® WebSphere® Message Broker provides an enterprise service bus connection, insulating the sales system from the technology specifics of the core banking system, the card management system, the credit decision system and a Short Message Service (SMS) gateway that the sales system uses for dynamic notifications to sales managers and others. To the sales system solution, the capabilities of these systems are delivered via meaningful service interfaces rather than low-level, complex technical programming constructs.

The heart of the sales system is its process specifications and policies, implemented via IBM WebSphere Process Server. The process specifications control almost every aspect of the sales process from planning through implementation of process improvements. Process specifications are supplemented by policies that define, for example, when sales representatives can approve exceptions on their own and when they must escalate through a manager.

The high level of control and visibility provided through BPM addressed another challenge, too—a holdover from the Communist era. Although the company as a whole was behaving in a proactive, competitive way, certain employees still behaved passively, some even doing as little work as they could get by with. With the new sales system, the process—and the performance of all those participating in it—became transparent and clear. The bank was able to help some of these employees improve their productivity and adapt to the new culture.

Reclaiming development costs

For the bank, the flexibility of BPM powered by smart SOA reached beyond the benefits of the new sales system solution and into the financing of the solution itself. The bank found that its systems integration partner, Pentegy Systems, was interested in having an off-the-shelf offering like the new sales system. The dramatic implementation time reductions provided by SOA and BPM changed the business case dynamics for Pentegy, making it feasible for Pentegy to offer the bank a substantially reduced cost for the solution in exchange for the right to resell the solution (with the exception of a small number of the bank’s proprietary functions). The bank also retains resale rights to the solution, which provides a potential way for the bank to recover even more of the sales system’s development cost.

Building improvement into the process

SOA and BPM will allow the bank to more effectively meet dynamic changes in its business objectives and business processes in the years ahead.

The bank’s BPM-enabled process reports against success metrics for each business line, region, branch, sales manager and employee, allowing focused attention on problem areas and identification of successful sales strategies.

BPM statistics provide measured visibility into each step of the bank’s sales and service cycles, allowing focused attention on improving individual process steps.

As the bank identifies process improvement opportunities and alters the process specifications in WebSphere Process Server, every user’s work is automatically directed via the new process, ensuring consistency.

Smarter financial services

A large Eastern European bank wanted to maintain its competitive edge in the international financial services industry and developed a business process management (BPM) and service-oriented architecture (SOA) solution designed to carry its proactive, sales-oriented culture to the branch level. With optimized processes built into a new sales platform, employees are taking advantage of every customer contact to sell products and services. They are not only working smarter, they are working more in concert with the bank’s market-oriented philosophy.

For more information

Contact your IBM sales representative or IBM Business Partner, or visit us at: http://www-01.ibm.com/software/websphere/

For more information on Pentegy, visit: www.pentegy.com/