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FROST & SULLIVAN BEST PRACTICES AWARD
Product Leadership 2019
DATA-DRIVEN BANKING - NORTH AMERICA
BEST PRACTICES RESEARCH
© Frost & Sullivan 2019 2 "We Accelerate Growth"
Contents
Background and Company Performance ........
BEST PRACTICES RESEARCH
© Frost & Sullivan 2019 3 "We Accelerate Growth"
Background and Company Performance
Industry Chall...
BEST PRACTICES RESEARCH
© Frost & Sullivan 2019 4 "We Accelerate Growth"
Thus, banks are uniquely positioned to leverage t...
BEST PRACTICES RESEARCH
© Frost & Sullivan 2019 5 "We Accelerate Growth"
Sophisticated Product Architecture
Personetics em...
BEST PRACTICES RESEARCH
© Frost & Sullivan 2019 6 "We Accelerate Growth"
Frost & Sullivan concludes that Personetics’ abil...
BEST PRACTICES RESEARCH
© Frost & Sullivan 2019 7 "We Accelerate Growth"
Not only has Personetics invested considerable re...
BEST PRACTICES RESEARCH
© Frost & Sullivan 2019 8 "We Accelerate Growth"
Significance of Product Leadership
Ultimately, gr...
BEST PRACTICES RESEARCH
© Frost & Sullivan 2019 9 "We Accelerate Growth"
successfully parlay product excellence into posit...
BEST PRACTICES RESEARCH
© Frost & Sullivan 2019 10 "We Accelerate Growth"
the ratings for a specific criterion do not lead...
BEST PRACTICES RESEARCH
© Frost & Sullivan 2019 11 "We Accelerate Growth"
Criterion 3: Operational Efficiency
Requirement:...
BEST PRACTICES RESEARCH
© Frost & Sullivan 2019 12 "We Accelerate Growth"
Best Practices Recognition: 10 Steps to Research...
BEST PRACTICES RESEARCH
© Frost & Sullivan 2019 13 "We Accelerate Growth"
The Intersection between 360-Degree Research and...
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Personetics Award Write-Up

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Personetics receives Frost & Sullivan's 2019 North American Data-driven Banking Product Leadership Award.

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Personetics Award Write-Up

  1. 1. FROST & SULLIVAN BEST PRACTICES AWARD Product Leadership 2019 DATA-DRIVEN BANKING - NORTH AMERICA
  2. 2. BEST PRACTICES RESEARCH © Frost & Sullivan 2019 2 "We Accelerate Growth" Contents Background and Company Performance ........................................................................3 Industry Challenges..............................................................................................3 Product Family Attributes and Business Impact ........................................................4 Conclusion...........................................................................................................7 Significance of Product Leadership................................................................................8 Understanding Product Leadership................................................................................8 Key Benchmarking Criteria ....................................................................................9 Best Practices Award Analysis......................................................................................9 Decision Support Scorecard...................................................................................9 Product Family Attributes ....................................................................................10 Business Impact.................................................................................................10 Decision Support Matrix ......................................................................................11 Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices .................................................................................................................12 The Intersection between 360-Degree Research and Best Practices Awards.....................13 Research Methodology ........................................................................................13 About Frost & Sullivan ..............................................................................................13
  3. 3. BEST PRACTICES RESEARCH © Frost & Sullivan 2019 3 "We Accelerate Growth" Background and Company Performance Industry Challenges Data-enabled disruption is dramatically impacting key industries. Frost & Sullivan believes that companies that can properly harness the power of digital data to optimize business operations, minimize risks, and support new product innovation are best equipped to succeed in the current age of digital transformation. Businesses lagging in embracing digital transformation will find themselves at a competitive disadvantage - and will struggle to improve customer relationships and business efficiency. In order to successfully operate as a data-driven organization, businesses must leverage high- performance analytical systems that can process structured enterprise data as well as semi-structured or unstructured Big Data to generate actionable customer intelligence. Frost & Sullivan notes that such systems must operate at the real-time speed of the business; they must rapidly process vast amounts of data and deliver actionable insights. Data-driven, personalized service experiences are critical to drive customer engagement. Increased customer engagement generates even more data, which can be used to further optimize client experiences. Businesses must relentlessly create and sustain this virtuous cycle in order to capitalize on data-driven business opportunities. Frost & Sullivan strongly encourages businesses to work with specialized vendors that have proven to deliver exceptional customer intelligence through advanced data analytics based on machine learning and artificial intelligence (AI) capabilities. Strategic partnerships with third-party vendors can help businesses develop internal capabilities. Moreover, businesses may choose to use third-party tools to develop baseline capabilities that can be offered to a wider customer base, while focusing internal resources to guide customization specific to their operating environment. Frost & Sullivan monitors how the banking industry has been radically transformed by this ongoing digital revolution. In order for the banking sector to keep pace with this growing global trend, the transformation from traditional banking operations to ‘data-driven’ banking services is essential. The entry of FinTech companies, ‘challenger banks’, and online banking providers (OLBs) has dramatically increased the competitive intensity for traditional retail banks. Frost & Sullivan’s own research indicates that a growing number of banks are open to investing in advanced analytics and data intelligence capabilities, particularly based on machine learning and AI capabilities as part of their efforts to deliver differentiated client experiences to attract and retain customers. However, factors such as industry regulations, privacy concerns, deeply entrenched legacy technology infrastructure, and cost and margin concerns can make it quite difficult for the traditional banks to justify investing in newer technologies. Banks inherently collect a significant amount of data on their customers. However, they are often sluggish when it comes to leveraging customer data for new product innovation. Clearly, this is a missed opportunity; banks must treat their customers’ digital data with the same level of importance and care as they treat their customers’ money. Frost & Sullivan recognizes the high level of trust customers traditionally have with their banks.
  4. 4. BEST PRACTICES RESEARCH © Frost & Sullivan 2019 4 "We Accelerate Growth" Thus, banks are uniquely positioned to leverage this relationship to deliver an expanded portfolio of value-added financial experiences to customers. In particular, banks are encouraged to explore growth opportunities from AI-driven financial awareness and wellness tools to help customers improve their financial lives. The focus must be on further educating customers to better understand their day-to-day banking activities and options, cultivating better financial decision-making and, ultimately, supporting financial goals in a more automated manner. Instead of offering personalized service experiences to a small subset of customers through expensive channels (such as relationship managers), banks must evaluate options to deliver customized service experience to individual customers (“segment of one”) at scale using digital channels and data-driven interactions. Doing so can help banks successfully elevate customer satisfaction levels and engender long-term client loyalty. Product Family Attributes and Business Impact Personetics is the leading provider of customer-facing AI solutions for financial services and the company behind the industry’s first Self-Driving Finance™ platform. With more than 65 million bank customers worldwide, Personetics has the largest direct customer impact of any AI solution provider in banking today. Personetics now counts among its customers 4 of the top 5 US banks and 6 of the top 12 banks in North America and Europe, as well as other leading banks throughout the world. The key success factors for Personetics as identified by Frost & Sullivan are described below. Innovative Product Capabilities Personetics solutions enable banks to offer retail, small business, and wealth management customers varying degrees of guidance in managing their finances through real-time insights, personalized recommendations, and automated money management capabilities. With Personetics, banks can adopt a gradual approach to self-driving finance comprising the below mentioned stages. • Insights: Banks can deliver relevant and personalized financial data and information to customers to help them better manage their day-to-day finances. This is an important step in establishing trust with users and promoting financial wellness, which ultimately is the steppingstone to building long-term relationships with bank customers. • Advice: Delivering personalized actionable recommendations to help customers attain their financial goals can help banks demonstrate that they are looking out for their customers’ best interests. • Automation: Automating money management for customers to help improve their financial wellbeing is the ultimate objective of self-driving finance. Automated money management capabilities increase the value delivered to customers and enable banks to properly capture greater share of customer wallets.
  5. 5. BEST PRACTICES RESEARCH © Frost & Sullivan 2019 5 "We Accelerate Growth" Sophisticated Product Architecture Personetics employs a unique on-the-fly AI processing design to ensure the accuracy, performance, and redundancy of its solutions. A highly-available cluster of stateless services reacts to meaningful events (financial/interactional) by merging data from multiple sources, normalizing it, and processing it with AI inference algorithms on the fly. This processing is done in-memory and in near real-time to make sure that all data is fresh. Moreover, the architecture enables advanced AI algorithms that require efficient random-access to processed data sets. Frost & Sullivan appreciates how this resulting output of meaningful personalized insights can be used to truly engage customers at scale across bank channels. Enhanced Customer Intelligence Personetics has successfully combined the sophistication of its machine learning models with deep understanding of financial services industry dynamics to deliver optimized solutions that are readily embraced by customers. The company realizes that each bank is unique, and therefore enables the bank to control the type and frequency of insights it delivers to customers. It offers a multitude of models, including balance, activity, reoccurrences, and unusual activity models that support a broad range of insights and solutions. By analyzing data from its 65 million users globally, Personetics knows which insights are most important for consumers - and combines that intelligence with personal feedback obtained from individuals to appropriately score and prioritize insights according to individual behavior. Frost & Sullivan points out that current customer feedback indicates a high level of satisfaction with Personetics solutions, which is a clear testament to the effectiveness of its implementations. Focus on Value Delivery Frost & Sullivan independent analysis indicates that the key impediments to allowing banks to realize the vision of self-driving finance include: • Lack of strategic focus: While certain business units maintain focus on extracting appropriate customer intelligence from data, lack of an enterprise-wide focus continues to hamper banks’ ability to effectively execute on their self-driving finance strategies. • Data silos: Customer data can exist in multiple isolated databases, which prevents banks from generating a holistic view of the customer. • Lack of quality and talent: Lack of quality customer data, data management platforms, and qualified data analytics personnel is a clear industry challenge. • Inability to build effective use cases: Historically, even the strongest banks have struggled with creating use cases that are impactful to consumers and businesses, leading to sub-optimal customer experiences.
  6. 6. BEST PRACTICES RESEARCH © Frost & Sullivan 2019 6 "We Accelerate Growth" Frost & Sullivan concludes that Personetics’ ability and develop use cases that are important to the customers can help banks clearly address the key challenges in enabling self-driving finance. With Personetics, banks can embrace the philosophy of an advocacy- based approach to help customers make better financial decisions. Working with banks of all sizes across multiple geographies, Personetics has been able to overcome data integration and quality issues, demonstrating that benefits can be delivered even with imperfect data and data infrastructure. While cloud migration can help accelerate this journey, cloud-based infrastructure is not a prerequisite for implementing Personetics’ solutions. Additionally, through integration with Salesforce and Microsoft Dynamics 365, Personetics is now able to deliver insights to bankers or relationship managers to help them improve customer understanding and deliver better service to their customers. This provides banks with an important additional benefit of using Personetics’ solutions across multiple channels of customer interaction. Effective Strategic Partnerships Through strategic partnerships, Personetics continues to become entrenched into the bank’s environments worldwide. Details of Personetics’ strategic partnerships are outlined below. • Complementary solution providers: Personetics collaborates with companies working with banks for supporting their data cleansing, enrichment, and aggregation efforts. • Marketing solution providers: In addition to helping bank customers better manage their financials, Personetics enables banks to offer personalized and contextualized offers through integrations with other marketing and campaign management solutions. • CRM platforms: Personetics empowers relationship managers at banks by sharing insights with bank CRM systems, thus allowing bank employees to have a more informed conversation and deliver higher value in their interactions with the customer (both consumers and small business customers). • Consulting organizations: Personetics partners with prominent consulting organizations driving digital transformation initiatives at the bank to help them shorten the time to market from vision to execution for AI-driven initiatives. Competitive Differentiation The biggest competition for Personetics comes from internal development initiatives at mid and large banks. However, Frost & Sullivan’s own research indicates that early attempts by banks to create in-house AI-driven solutions have taken longer than anticipated, and banks have clearly struggled with multiple aspects of such projects (such as training of the machine models). Recognizing that mid to large size banks are keen to enhance internal competency, Personetics’ Engagement Builder tool enables banks to easily create custom insights with internal resources, thereby accelerating time to market and building internal capabilities.
  7. 7. BEST PRACTICES RESEARCH © Frost & Sullivan 2019 7 "We Accelerate Growth" Not only has Personetics invested considerable resources and time in enabling self-driving finance, the company’s unique position as a market leader enables it to have superior visibility into the effectiveness of insights delivered to bank customers and use this data to continually enhance the solution. Among companies uniquely focused on financial services, Personetics has the largest scale. Potential competition is expected from specialized personal financial management (PFM) solution providers, although many banks that have implemented PFM solutions are currently adding Personetics Self-Driving Finance capabilities on top of their PFM database. In addition, Personetics has integrated the core components of self-driving finance in a seamless manner to deliver comprehensive, tailored solutions to help banks securely manage their self-driving finance initiatives. The company firmly believes there is a defined maturity curve on the way to achieving self-driving finance, delivering benefits to customers and business results to the bank at every step along the way. Frost & Sullivan expects the competitive intensity to further increase in self-driving finance. However, Personetics is expected to maintain its growth momentum and remain a global leader. Personetics has maintained an independent market position, which has helped the company take strategically pertinent decisions related to new product enhancements - as well as operational strategies to deliver the best value to bank customers. Conclusion By delivering measurable critical business outcomes for banks through next-generation implementations, Personetics has emerged as a preferred vendor of AI-based self-driving finance solutions. The company continues to invest aggressively in enhancing product capabilities and has ensured that all customers, regardless of size of deployment, receive exceptional service and support. With its strong overall performance, Personetics has earned the 2019 Frost & Sullivan Product Leadership Award.
  8. 8. BEST PRACTICES RESEARCH © Frost & Sullivan 2019 8 "We Accelerate Growth" Significance of Product Leadership Ultimately, growth in any organization depends on customers purchasing from a company and then making the decision to return time and again. A comprehensive product line filled with high-quality, value-driven options is the key to building an engaged customer base. To achieve and maintain product excellence, an organization must strive to be best in class in three key areas: understanding demand, nurturing the brand, and differentiating from the competition. Understanding Product Leadership Demand forecasting, branding, and differentiating all play critical roles in finding growth opportunities for a leading product line. This three-fold focus, however, must be complemented by an equally rigorous focus on pursuing those opportunities to a best-in- class standard. Customer communication, customer feedback, pricing, and competitor actions must all be managed and monitored for ongoing success. If an organization can
  9. 9. BEST PRACTICES RESEARCH © Frost & Sullivan 2019 9 "We Accelerate Growth" successfully parlay product excellence into positive business impact, market share will inevitably increase. Key Benchmarking Criteria For the Product Leadership Award, Frost & Sullivan analysts independently evaluated 2 key factors—Product Family Attributes and Business Impact—according to the criteria identified below. Product Family Attributes Criterion 1: Match to Needs Criterion 2: Reliability and Quality Criterion 3: Product/Service Value Criterion 4: Positioning Criterion 5: Design Business Impact Criterion 1: Financial Performance Criterion 2: Customer Acquisition Criterion 3: Operational Efficiency Criterion 4: Growth Potential Criterion 5: Human Capital Best Practices Award Analysis for Personetics Decision Support Scorecard To support its evaluation of best practices across multiple business performance categories, Frost & Sullivan employs a customized Decision Support Scorecard. This tool allows research and consulting teams to objectively analyze performance according to the key benchmarking criteria listed in the previous section, and to assign ratings on that basis. The tool follows a 10-point scale that allows for nuances in performance evaluation. Ratings guidelines are illustrated below. RATINGS GUIDELINES The Decision Support Scorecard considers Product Family Attributes and Business Impact (i.e., the overarching categories for all 10 benchmarking criteria; the definitions for each criterion are provided beneath the scorecard). The research team confirms the veracity of this weighted scorecard through sensitivity analysis, which confirms that small changes to
  10. 10. BEST PRACTICES RESEARCH © Frost & Sullivan 2019 10 "We Accelerate Growth" the ratings for a specific criterion do not lead to a significant change in the overall relative rankings of the companies. The results of this analysis are shown below. To remain unbiased and to protect the interests of all organizations reviewed, Frost & Sullivan has chosen to refer to the other key participants as Competitor 2 and Competitor 3. Measurement of 1–10 (1 = poor; 10 = excellent) Product Leadership Product Family Attributes Business Impact Average Rating Personetics 9.5 9.5 9.5 Competitor 2 8.2 8.0 8.1 Competitor 3 8.0 8.0 8.0 Product Family Attributes Criterion 1: Match to Needs Requirement: Customer needs directly influence and inspire the design and positioning of the product family. Criterion 2: Reliability and Quality Requirement: Products consistently meet or exceed customer expectations for performance and length of service. Criterion 3: Product/Service Value Requirement: Products or services offer the best value for the price, compared to similar offerings in the market. Criterion 4: Positioning Requirement: Products or services address unique, unmet needs that competitors cannot easily replicate or replace. Criterion 5: Design Requirement: The product features an innovative design, enhancing both visual appeal and ease of use. Business Impact Criterion 1: Financial Performance Requirement: Overall financial performance is strong in terms of revenue, revenue growth, operating margin, and other key financial metrics. Criterion 2: Customer Acquisition Requirement: Product strength enables acquisition of new customers, even as it enhances retention of current customers.
  11. 11. BEST PRACTICES RESEARCH © Frost & Sullivan 2019 11 "We Accelerate Growth" Criterion 3: Operational Efficiency Requirement: Staff is able to perform assigned tasks productively, quickly, and to a high quality standard. Criterion 4: Growth Potential Requirements: Product quality strengthens brand, reinforces customer loyalty, and enhances growth potential. Criterion 5: Human Capital Requirement: Company culture is characterized by a strong commitment to product quality and customer impact, which in turn enhances employee morale and retention. Decision Support Matrix Once all companies have been evaluated according to the Decision Support Scorecard, analysts then position the candidates on the matrix shown below, enabling them to visualize which companies are truly breakthrough and which ones are not yet operating at best-in-class levels. High Low Low High BusinessImpact Product Family Attributes Personetics Competitor 2Competitor 3
  12. 12. BEST PRACTICES RESEARCH © Frost & Sullivan 2019 12 "We Accelerate Growth" Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices Frost & Sullivan analysts follow a 10-step process to evaluate Award candidates and assess their fit with select best practices criteria. The reputation and integrity of the Awards are based on close adherence to this process. STEP OBJECTIVE KEY ACTIVITIES OUTPUT 1 Monitor, target, and screen Identify Award recipient candidates from around the world • Conduct in-depth industry research • Identify emerging industries • Scan multiple regions Pipeline of candidates that potentially meet all best- practice criteria 2 Perform 360-degree research Perform comprehensive, 360-degree research on all candidates in the pipeline • Interview thought leaders and industry practitioners • Assess candidates’ fit with best practices criteria • Rank all candidates Matrix positioning of all candidates’ performance relative to one another 3 Invite thought leadership in best practices Perform in-depth examination of all candidates • Confirm best practices criteria • Examine eligibility of all candidates • Identify any information gaps Detailed profiles of all ranked candidates 4 Initiate research director review Conduct an unbiased evaluation of all candidate profiles • Brainstorm ranking options • Invite multiple perspectives on candidates’ performance • Update candidate profiles Final prioritization of all eligible candidates and companion best practices positioning paper 5 Assemble panel of industry experts Present findings to an expert panel of industry thought leaders • Share findings • Strengthen cases for candidate eligibility • Prioritize candidates Refined list of prioritized Award candidates 6 Conduct global industry review Build consensus on Award candidates’ eligibility • Hold global team meeting to review all candidates • Pressure-test fit with criteria • Confirm inclusion of all eligible candidates Final list of eligible Award candidates, representing success stories worldwide 7 Perform quality check Develop official Award consideration materials • Perform final performance benchmarking activities • Write nominations • Perform quality review High-quality, accurate, and creative presentation of nominees’ successes 8 Reconnect with panel of industry experts Finalize the selection of the best practices Award recipient • Review analysis with panel • Build consensus • Select recipient Decision on which company performs best against all best practices criteria 9 Communicate recognition Inform Award recipient of recognition • Present Award to the CEO • Inspire the organization for continued success • Celebrate the recipient’s performance Announcement of Award and plan for how recipient can use the Award to enhance the brand 10 Take strategic action Upon licensing, company is able to share Award news with stakeholders and customers • Coordinate media outreach • Design a marketing plan • Assess Award’s role in strategic planning Widespread awareness of recipient’s Award status among investors, media personnel, and employees
  13. 13. BEST PRACTICES RESEARCH © Frost & Sullivan 2019 13 "We Accelerate Growth" The Intersection between 360-Degree Research and Best Practices Awards Research Methodology Frost & Sullivan’s 360-degree research methodology represents the analytical rigor of our research process. It offers a 360-degree view of industry challenges, trends, and issues by integrating all 7 of Frost & Sullivan’s research methodologies. Too often companies make important growth decisions based on a narrow understanding of their environment, resulting in errors of both omission and commission. Successful growth strategies are founded on a thorough understanding of market, technical, economic, financial, customer, best practices, and demographic analyses. The integration of these research disciplines into the 360- degree research methodology provides an evaluation platform for benchmarking industry participants and for identifying those performing at best-in-class levels. About Frost & Sullivan Frost & Sullivan, the Growth Partnership Company, helps clients accelerate growth and achieve best-in-class positions in growth, innovation and leadership. The company's Growth Partnership Service provides the CEO and the CEO's growth team with disciplined research and best practices models to drive the generation, evaluation, and implementation of powerful growth strategies. Frost & Sullivan leverages nearly 60 years of experience in partnering with Global 1000 companies, emerging businesses, and the investment community from 45 offices on 6 continents. To join Frost & Sullivan’s Growth Partnership, visit http://www.frost.com. 360-DEGREE RESEARCH: SEEING ORDER IN THE CHAOS

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