This document outlines an agenda and presentation for a business analytics seminar for credit union executives and board directors. The presentation will define business analytics, explain how it can help credit unions address key issues like margin compression and regulatory compliance, and provide examples of how analytics can be applied to areas like marketing, risk management, and branch performance. Attendees will learn how predictive analytics can help credit unions retain members, optimize pricing, and streamline operations. The presentation will also cover getting started with business analytics projects.

1. MNP Technology Consulting
Presents:
Business Analytics:
Top Line Growth and Bottom Line Results
May 8, 2012

2. Introductions - Facilitators
Brian Beveridge
Partner, Technology Consulting Leader
MNP LLP
Shelley Legin
Credit Union Consulting Lead
MNP LLP

3. Agenda
• 1:45 – 2:45 – Presentation
• 2:45 – 3:00 – Interactive Session
• 3:00 – 3:15 – Q & A

4. Objectives
Give Credit Union Executives and Board
Directors an Understanding of:
1. What Business Analytics is
2. How could it be applied to Your Credit
Union
3. How could you get started on a
Business Analytics Project
Does anyone have any other Objectives?

5. Topics
1. Introduction
2. A Business Analytics Primer
3. The link between Business Success and
Business Analytics
4. How can Business Analytics address the
Key Issues in Credit Unions?
5. Is there an App for That? (Mobile
Business Analytics)

6. Topics
6. How to get started with Business Analytics
projects
7. Interactive Session
8. Q & A

7. What is Business Analytics?
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8. We live in a
Connected, Instrumented, Dat
a-Rich World

9. Nissan Leaf Dashboard

10. My Ski Goggles

11. What is Business Analytics?
“Business Intelligence” Term Coined by
Gartner in 1989
– Simply defined as “using information
effectively to make better decisions”.

12. What is Business Analytics?
Gartner‟s Emphasis Today: “Corporate
Performance Management “
CPM means getting a better finger on the
pulse of an organization to make a
better, more accurate, and more timely
assessment of how an organization is doing.
Enterprises need to move away from
asking, “How did we do last month or last
quarter” to “How are we doing right now” as
well as “How will we do next week”

13. MNP‟s Definition of Business
Analytics
Improving our client‟s business
results by providing business
insights to all employees leading
to better, faster, more
relevant decisions

14. The link between Business
Success and Business Analytics

15. Information is the Key to a New Wave of
Opportunity…
44x
as much Data and Content
Over Coming Decade
But Businesses are
Challenged to Leverage it….
1 in 3
2020
35 zettabytes
Sources:
• The Guardian, May 2010
• IBM Institute for Business Value, 2009
• IBM CIO Study 2010
• TDWI: Next Generation Data Warehouse Platforms Q4 2009
Business leaders frequently
make decisions based on
information they don’t trust, or
don’t have
1 in 2
Business leaders say they don’t
have access to the information
they need to do their jobs
83%
of CIOs cited “Business
intelligence and analytics” as
part of their visionary plans
to enhance competitiveness

16. Organizations embracing Business
Analytics have the answers …
3x
Organizations that lead in
analytics outperform those
who are just beginning to
adopt analytics
5.4x
Top Performers are more
likely to use an analytic
approach over intuition*
*within business processes
Source: Analytics: The New Path to Value, a joint MIT Sloan Management Review and IBM Institute of Business Value study. Copyright © Massachusetts Institute of Technology 2010.

17. Winners in the Financial Industry
Customer analytics
Operational efficiency
Using advanced
analytics to profile
and segment target
customers, First
Tennessee Bank
improved
marketing
effectiveness by:
Using financial
analytics to
streamline
statement creation,
First Command
accelerated monthend updates by
over:
600%
Risk management
Using business
intelligence to
create an online
credit tool, Argos
generated an
annual business
value for each
customer of:
500% $855K

18. A Business Analytics Primer

19. Problems with Traditional Reporting
and Analysis
• Predefined Reports built into specific applications
such as Financials, HR, Point of Sale, etc.
• Some capability to customize layouts and
parameters but typically limited
• Biggest limitation has been the „scope‟ – i.e. You
cannot easily combine and analyze data across
application boundaries – i.e. HR and Financial
information combined in the same report
• Limited ability to „model‟ and try different scenarios
• Changes often require IT to customize which costs
time and $$
Page  19

20. Traditional Reporting and Analysis
Does a Pretty
Good Job
Typically not
“real time”
Typically –
not
addressed
Page  20

21. Business Analytics Helps with Corporate
Performance Management
How are
we doing?
What should
we be doing?
Analytics
Why?

22. BA Helps with Corporate Performance
Management
■ Performance
■ Decision Making
■ Information
■ Data

23. What if you had all the answers to win?
Which
customers
are thinking
of leaving?
Which
transactions
are
suspicious?
How is
Margin
Compression
affecting my
credit union?
The ultimate differentiator today…
…is being able to make more informed choices with
confidence, to anticipate and shape business outcomes.
How can I
extract
insight from
all of my
information?

24. A Taste for Analytics
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25. Guided Exploration of Your Data
• Enables guided exploration of information
that pertains to all dimensions of your
business
• Continuous exploration and investigation of
past performance to gain new insights and
aid in business planning
• Facilitates complex analysis and scenario
modeling easily and quickly without requiring
IT resources
• Gets to the “why” behind an event or action
to improve business performance.
• Provides navigation from summary to detail
levels of information effortlessly

26. The Four Styles of Analysis
Line
Managers
Business
Users
Financial
Analysts
Business
Analysts
Business
Managers
Executives
How are we doing?
Why?
What should we be doing?
Immediate, visual insight into
business performance
Self-service analysis of
trends and patterns
Insight to determine strategy,
allocate resources and set targets
Analytic
Reporting
Predictive
Analytics
Trending
Scenario
Modeling
• Top down view
• Drillable reports
• Sort top & bottom
• Review then query
• Personal exploration
• Compare & contrast
• Rotate and nest
• Work disconnected
• Model scenarios
• Compare
scenarios
• Save versions
• Uncover patterns
• Statistical calcs
• Mine data/text
• Predict will be”
”What outcomes
• Budget Variance
• Product ranking
• Sales trend analysis
• Market analysis
• Financial analysis
• Profitability
analysis
• Fraud prevention
• Churn analysis
”Drill-Down”
”Slice and Dice”
”What if”

27. The Four Styles of Analysis
Line
Managers
Business
Users
Financial
Analysts
Business
Analysts
Business
Managers
Executives
How are we doing?
Why?
What should we be doing?
Immediate, visual insight into
business performance
Self-service analysis of
trends and patterns
Insight to determine
strategy, allocate resources and set
targets
Business Analytics Application Components
Dashboards Scorecards
Reports
Queries
Analysis
Content
analytics
Predictive
modeling
Planning/
budgeting
Business Analytics platform
Loans
Systems
Banking
Systems
HR Systems
Marketing
Systems
Financial
Systems

28. Business Analytics Continuum
Scenario
Modeling
Trending
Analytic
Reporting
Predictive
Analytics

29. Business Analytics Applications
Analytic Reporting
 Provides full breadth of report types
 Delivers consistent information across all types of
report output
 Can be personalized and targeted
 Enables collaboration across users, communities
and with IT
 Provides access via email, portal, MS-Office,
search and mobile devices etc
Multi-Dimensional Analysis
 Provides guided exploration across multiple
dimensions of information
 Performs complex analysis and scenario modeling
easily and quickly
 Gets to the “why” behind trends to reveal
symptoms and causes
 Moves from summary level to detail levels of
information effortlessly

30. Business Analytics Applications
Dashboards
 Provides at-a-glance, high impact views of
complex information
 Helps quick focus on issues that need attention
and action
 Are highly visual and intuitive
 Combines information across disparate sources
Scorecards
 Provides instant measurement relative to
targets and benchmarks
 Aligns decisions and tactics with strategic
initiatives
 Supports scorecarding methodologies
 Ensures ownership and accountability

31. Scenario Modelling
 Model and compare
scenarios
 Reorganize, reshape
 Multiple versions
 Financial and profitability
analysis
 Exploration and „what-if‟
scenario modeling

32. Predictive Analytics is Transformation Technology
• Analyzes patterns found in historical and
current transaction data
• Analysis into attitudinal survey data to
predict future outcomes
• Enables more proactive decision
making, driving new forms of competitive
advantage:
– How do I predict outcomes resulting
from my decisions?
– How can I predict demand and
allocate resources to ensure I am
delivering services effectively?
– How can I find the patterns in vast
amounts of data?

33. Summary – Business Analytics in Context
Planning, Budgeting,
Forecasting & Consolidation
Analysis & Reporting
What happened?
What will happen?
Report
Forecast
Single
Data Model
What is happening?
Scorecard
Why?
Analyze
What do I want to happen?
Plan

34. Move from “Sense and Respond”
to “Predict and Act”
Predict and act
Velocity
Lack of
Insight
Inefficient
Access
Volume
Sense and respond
Instinct and intuition
Skilled analytics experts
Variety
Inability
to Predict
Back office
Real-time, fact-driven
Everyone
Point of impact
Automated
Optimized

35. How can Business Analytics address
the Key Issues in Credit Unions?

36. Key Business Issues Facing Credit
Unions
1.
2.
3.
4.
5.
6.
Address Margin Compression
Develop a strategy for consolidation
Enhance regulatory compliance
Prepare for industry transformation
Attract new members
Leverage IT to improve productivity and
profitability
7. Attract, manage and retain top talent
8. Protect your members from fraud

37. Credit Union What ifs…
Payments
Branch management
... predictive analytics could detect
and prevent a wire transfer identified
as high probability of fraud?
...could understand which
branches or products were
performing the best?
Executive leaders
...could make better business
decisions using accurate data
across all time horizons
Relationship
management
...could consider
the risk and
profitability of the
entire member
relationship when
pricing new deals?
Risk and finance
Marketing
...could predict the right
offer for the right
member at the right
time?
...could streamline
compliance and
understand risk
exposure across
businesses and
regions?

38. The Irony is…
• You probably have more than enough DATA to
get the answers…
• But you can‟t access it, analyze it, or
communicate it well enough
• You understand people who have already done
business with you vs those that have not
• “Myth Busting” – many assumptions may not be
supported by the data

39. No Shortage of Internal Data
Member Data
Financial Products
-
-
# of members
Demo Information
Location
Accounts
Issue – How to
transform it into
INFORMATION
and ACT on it
Revenue
Costs
Location
Accounts
Financial Transactions
Branch Data
-
-
Deposits/Withdrawals
Loan Pmts
Interest
Members by Brach
Revenue by Branch
Product Mix by Branch

40. The Data isn‟t always where its needed
Executive
- Strategic Planning
Middle Managers
- Management Control
Front-Lines
- Operational Control

41. The greatest challenge of the computer
industry is to learn how to build
information bases, not databases. The
really important information cannot be
easily quantified and exists outside the
organization.
- Peter Drucker (1993)

42. The Analytics-Driven Credit Union
Increase flexibility and
streamline operations
Optimize
enterprise risk
management
42
$
Create a
Memberfocused Credit
Union

43. The Member View
How do I retain my
best members?
Who are my ideal
members and how do I
attract them?
How can I ensure that our
pricing is competitive and
profitable?
What products/services
attract mass affluent
members?
?
How do I find the optimal
balance between service
and cost of delivery?
How can I improve service
Why are my marketing
response rates so low?
How do I make more
members highly
profitable?
43
levels and the knowledge
of my front-line
employees?
Which are my best
performing branches?

44. Member Profitability Analytics
 Create profitability analysis and forecasts
 Perform “what if?” scenario analytics
 Calculate profit and loss (P&L) at the
account level
 Increase cross and up sell opportunities
 Analyze historical information to:
 Predict customer propensity to buy
 Develop lifetime value models
 Create account retention strategies
 Develop strategies to improve retention
and wallet-share of profitable customers
 Reduce servicing costs by matching
service levels to customer value

45. Marketing Optimization
 Mine historical member information to
determine patterns and segmentation
 Use predictive models to determine
likelihood of response to offers or
defection
 Generate reports and alerts on
customer interactions and portfolios
 Incorporate unstructured text data into
the analysis to better capture customer
sentiment
 Predict which customers are likely to
leave and what will keep them
 Use marketing dashboards to track and
monitor response and sales created
 Improve marketing cross-sell efforts and
reduce execution costs
45

46. Relationship Pricing
 Delivers an intuitive, centrally controlled
pricing tool that considers complete
relationship value and risk to improve pricing
consistency for both credit and non-credit
deals
 Provides bottom-up and top-down planning
capability and automated approval workflow
 Enables quick changes and consistent roll out
with centrally controlled pricing model
 Provides dashboards for relationship
managers, lending officers and senior
management
 Enables relationship managers to quickly and
consistently evaluate risk and profitability of
new business and increases management
visibility into lending book

47. Client Servicing
 Includes paperless, real-time selfservice reporting and analysis of
account holdings and recent activity
 Delivers Wealth Manager dashboard
with service process
monitoring, reporting, analysis and
forecasting
 Provides online or mobile client
statements with portfolio
summary, performance analysis and
asset allocation
 Improves relationship manager
knowledge and customer service

48. Risk Management View
How do I inform
business users about
the risk impact
of decisions?
How do I integrate
governance, risk and
compliance
processes?
Could I benefit from
fraud detection and
credit risk analytics?
Can I perform risk scenario
analytics?
48
How do I eliminate
operational silos to get
an enterprise view of
risk?
How do I operationalize
risk appetite?
?
How do I respond more
efficiently to evolving
regulatory requirements?
What operational risks
can be reduced?
How do I ensure that
pricing models are risk
adjusted?

49. Governance, Risk and Compliance
Provides an integrated enterprise risk solution to
help reduce risk exposure and simplify
regulatory response with a single system of
record
Enables the identification, management,
monitoring and reporting of operational risks and
regulatory compliance initiatives, including policy
management and IT
Improves processes with fully integrated risk
and compliance data
 Risk control self-assessments
 Scenario analysis
 Key risk indicators
 Loss event database
 Policies and regulatory mandates
 Harmonized control framework
Provides root cause analysis

50. Risk Insight & Optimization
 Includes business intelligence to provide
finance-integrated, actionable risk
dashboards, scorecards, and reporting
 Enables risk adjusted financial
planning, business modeling, strategy
selection and initiative planning
 Scenario analysis for all risk classes
(credit, market, liquidity, operational, counterp
arty)
 Risk optimization through risk and finance
integration, risk appetite management and
communications, strategic planning, and riskadjusted relationship pricing
50

51. The Streamlining View
How do I provide better
executive visibility into
enterprise performance?
Where can I cut costs
without affecting
revenue?
?
How do I improve tracking/
monitoring of high-value
payments?
What branches and
relationship managers are
my best performers?
Why?
How do I streamline
my financial
planning/budgeting
process?
How do I deliver real-time
insight at the point of
impact?
What’s the best
approach for IT cost
allocation?

52. Branch Performance Management
 Enables driver-based, rolling branch financial
planning at the product and customer segment
level
 Provides staff planning so headcount expenses
can be easily understood and controlled
 Monitors and analyzes key revenue, cost and
profitability measures by branch, product type,
product, member segment and even household

53. Payments Monitoring and Analysis
 Monitors transactions by
counterparty, geography, asset class
and transaction type
 Identifies trigger events for interventions
 Implements governance of key
performance measures and targets
 Predicts traffic, counterparty weakness
and bottlenecks
 Builds agile, fully costed plans and
forecasts to optimize pricing/chargeback
tariffs
53

54. Is there an App for That? (Mobile
Business Analytics)
-54-

55. Is there an App for that?

56. You‟ve seen the headlines…
• Today, over 80% of the Fortune 100 are
already deploying or piloting iPad -(NetworkWorld
2011)
• “Mobile BI has the potential to significantly
expand the population of BI users to include
a much more mainstream audience” -(Gartner
2011)
• “Forty percent of devices that information
workers use to access business applications
are personally owned” – (IDC 2011)

57. Why Mobile Business Analytics?
• Very broad reach
• “Real Time” accessibility of information
and decision making
• New, immersive experiences and
visualizations
• New possibilities for Collaborative
Business Analytics

60. How to Get Started with Business
Analytics projects
-60-

61. How to get started with BA?
• First and foremost – You need to realize that
Business Intelligence is not „Out of the Box‟
unless plugging into ERP or other „Single
Application‟ Solution
• There is typically design and development
work involved
• Depends heavily on your data and application
mix as well as your objectives/metrics
• Invest in “Up Front” planning and “selling” of
the project

62. What has to go Right on BA
Projects?
1.
2.
3.
4.
5.
6.
Executive Sponsorship and Commitment
Planning
Trust in the Data – Data Validation
Proper Roles
Change Management
Sustainment

63. Strategy Based Analytics Approach

64. Plug Into CU Management Process
1. The strategic management process where
strategic issues are refined and implications
discussed.
2. In the operational management process
corrective actions are taken and implications are
discussed.
3. In the daily management processes corrective
actions are taken.
In all three processes, there is an „evidence based‟ or
analytics-based review of performance indicators

65. Getting Started with Analytics
Projects
1.
2.
3.
4.
5.
Start with an Executive Discovery Session
Review Business Strategy
Build the linkages from Strategy to Measures
Determine success indicators
Identify process and project fitness –
Readiness Assessment
6. Build the scorecard/measurement process
7. Gather Data from Operational Systems
8. Build the Views, Reports, Analyses, and
Dashboards

66. Readiness Assessment
Asks the following questions:
1. Do you have executive support?
2. Are the goals defined?
3. Can your staff handle the change?
4. Do you have the data needed?
5. Can your systems support BA?
6. Can your IT staff handle this?

68. Avoid Common Pitfalls
1. Lack of Planning You need a map of where you're
hoping to go – and the team to get you there.
2. Under-Estimating the Data Access/Validation phases
of the project.
3. Lack of Resources – You will need:
• Business Expert
• Data Expert
• Business Analytics Solutions Expert

69. Avoid Common Pitfalls
4. Lack of responsibility. If you are going to make critical
decisions on the data in the BA system, you need at
least one staff member who takes responsibility to be
the „Data Validation Cop' of content.
5. No Change Management. You need to get people
prepared for the change in their roles and
responsibilities as well as the challenges of having
data/results more visible.
6. Lack of Ongoing Sustainment. You need to constantly
feed the solution with data and adjust the metrics as the
business changes.

70. Interactive Session
• Business Analytics – Credit Union
Examples
• Mobile / iPad Analytics Solutions

71. Questions
-71-

72. Thanks for Participating
-72-

73. Follow Up
•
Brian Beveridge
•
(204)-775-3500 ext 4602
•
Brian.Beveridge@mnp.ca
• Shelley Legin
• (778)-772-8009
•
Shelley.Legin@mnp.ca