Overview of successful approach used.

1. CRM Gap Analysis And Making CRM Useful
Customer Processes
Strategy
Organizational
Change Technology
Greg French
Example of Approach Used
1

2. The Gap Analysis is based on extensive
organizational participation and tested framework
Starting Point: Current State
Current CRM state has been assessed
through extensive study of company
documentation, CRM Scorecard
responses, and 20+ in-depth
interviews with various executives
and managers.
Analysis Framework
The high-level vision defined in
the Vision & MOS in terms of
Organization, Process,
Technology is been further
broken down into six areas of the Customer strategy
—
CRM Business Framework: — Customer data
— Value proposition
— Customer contact
— Operations
— Organization
2

3. CRM business framework consisting of six areas
is used to structure the Gap Analysis
CRM Area CRM Area Description and Objectives
Define and operationalize how individual customer relationships are to be managed
Customer Strategy • Customer value definition
• Definition of customer segments and objectives
• Definition of customer strategies and treatments
• Test and learn
• Decisioning environment
Provide the tools and data needed to manage a customer value-based organization
Customer Data • Data availability and gathering
• Data quality
• Data infrastructure
• Models
Develop innovative product offerings with the flexibility to personalize key features (e.g., pricing
Value Proposition and channel options) according to the customer segment objectives
Customer Contact Manage all CRM processes, systems and customer-facing staff and channels that have any
interaction with the customer to deliver consistent and high quality customer experiences
• Contact infrastructure - customer-specific guidelines, contact tracking, results capturing, etc.
• Contact channel processes and scripting
Ensure consistent administration and execution of differentiated customer strategies and
Operations treatments
• Response to changes in customer strategies and treatments
Manage transition from a product-focused to a customer-focused organization
Organization • Organizational alignment
• Performance incentives
3

4. The following CRM terms are used throughout
this analysis

Vision 
Customer Segments
The company CRM targeted end state Cross-LOB customer grouping based on customer
 End State Requirements value and other customer level metrics, such as
Set of statements that describe how The Provident attrition
will look and function after its CRM vision has been  Segment Objectives
fully implemented
Enterprise-wide business objective for each
 CRM Areas customer segment (e.g. retain&grow, manage
6 inter-related areas of the CRM business model that risk, etc.)
must be aligned to support enterprise wide customer  Customer Treatments
profitability-oriented strategic objectives Actions defined for each customer for each function

Enablers (e.g. marketing offer, fee refund limit, service level,
Technology or business components, technical or etc.)
business activities, and/or knowledge currently  Customer Strategy
existing or underway at The Provident that will Collection of all treatments for each customer
facilitate the transition to the CRM end-state vision  Test and Learn
 Gaps
Continuous process of analyzing results and evolving
Distance between the current and envisioned customer treatments using experimental design
business model that identifies which competencies  Decisioning
need to be developed to realize the vision
Process of evaluating customer metrics and

Gap Size determining segment and treatments for each
Individual-level gap - Magnitude of individual gaps customer
based on AMS observations and experience, Provident
interview input (see page 9), as well as presence of
effort underway and its leveragability as reflected by
enablers
Area-level gap - Magnitude of area-level gaps,
assessed collectively on Area level

Kiviat Chart
Visual tool used to communicate the gap level The
Provident needs to overcome in order to realize the
CRM Vision
4

5. The Kiviat Chart Concept is used to visualize CRM
current state and summary of gaps
Kiviat Chart:
— Summarizes the company’s current gap level to overcome and
realize the CRM Vision
— Presents a high-level CRM assessment
— Contains 6 axes, each representing 1 of the 6 CRM areas
— Assess each area using a 5-point scale
Operations
Organization
Customer
e
pl
Contact Area is at the Vision state
m
Exa Area is at minor distance from the Vision state
Area is at moderate distance from the Vision state
Value Customer Area is at significant distance from the Vision state
proposition Strategy
Area is at major distance from the Vision state
Customer Data
Note:
The shaded area provides a big picture of the current state of CRM at the company. An
enterprise that has fully employed CRM would have a filled-out profile.
5

6. Company Vision: Customer Strategy
 Accept and document cross-LOB definition of customer
relationship value (across all accounts and products)
 Develop an enterprise-wide customer segmentation scheme based
on customer metrics (e.g. value, attrition, etc.)
 Define business objectives for each customer segment
 Define cross-LOB customer strategies and treatments for all
customer segments
 Conduct test & learn (experimental design, strategy evolution,
results analysis) to monitor the effects of multiple treatments for
customer segments
 Deploy established methodologies to evaluate customer strategy
effectiveness, consistent across all products and channels
 Define economic impact of customers treatments on customer
value, attrition, and satisfaction
 Use enterprise decisioning environment to facilitate customer
evaluation, segmentation and treatment definition
6

7. Gaps & Enablers : Customer Strategy
Area Objective: Define and operationalize how individual customer relationships are to be managed
CRM Area End State Requirement Gap Enablers Gap Size
Customer 1. Accept and document cross-LOB 1. No cross-LOB • Organization structure
Strategy definition of customer relationship definition of customer (all products under the
value (across all accounts and value agreed to umbrella of Customer
products) Management)
• New profitability system
2. Develop an enterprise-wide 2. No segmentation based • Needs-based segmentation
customer segmentation scheme on customer value proposed (as outlined by
based on customer metrics (e.g. exists today BAIGlobal) but not yet
value, attrition, etc.) operationalized
3. Define business objectives for each 3. No customer segments
customer segment exist
4. Define cross-LOB strategies and 4. Strategies and treatments
treatments for all customer segments are not based on
customer value and are
LOB- specific
KEY
No Gap - Provident has all capabilities in the area Significant Gap - Provident has few capabilities in the area
Minor Gap - Provident has most capabilities in the area Major Gap - Provident has no capabilities in the area
Moderate Gap - Provident has some capabilities in the area
7

8. Gaps & Enablers : Customer Strategy (continued)
Area Objective: Define and operationalize how individual customer relationships are to be managed
CRM Area End State Requirement Gap Enablers Gap Size
Customer 5. Conduct test & learn (experimental 5a.Limited manual cross-LOB • Feedback established
Strategy design, strategy evolution, results feedback on business between loan collections
analysis) to monitor the effects of activities exist and originations to improve
multiple treatments for customer credit decisions
segments 5b.Limited evolution of
customer treatments based • Manual feedback process
on feedback exists between branch and
marketing on campaigns
• Horizon ACquire
6. Deploy established methodologies 6a.No experimental design • Monthly Key measures
to evaluate customer strategy methodology currently in Management Report
effectiveness, consistent across all use today
products and channels
6b.No statistical software for
analyzing results of
experiments in use
7. Define economic impact of 7. No cross-LOB customer • Customer-level attrition
customers treatments on customer metrics exists metric exists but it is not
value, attrition, and satisfaction linked to specific
customer treatments
8. Use enterprise decisioning 8a. No enterprise-wide • Current loan application scoring
environment to facilitate customer decisioning • MCIF
evaluation, segmentation and environment* • Mortgage Ware
treatment definition
8b. Decisioning limited to • Horizon RMS
the origination function
KEY
No Gap - Provident has all capabilities in the area Significant Gap - Provident has few capabilities in the area
Minor Gap - Provident has most capabilities in the area Major Gap - Provident has no capabilities in the area
Moderate Gap - Provident has some capabilities in the area
8

9. Company Vision: Customer Data
 Achieve a common definition of a customer, including all its
potential levels- account, individual, and household
 Capture data to measure customer value for all customers on a
regular basis (at least monthly)
 Use customer value and predictive models as inputs to enterprise-
wide customer value segmentation scheme and treatment
definition
 Update segmentation inputs regularly
 Maintain, validate, and refine segmentation inputs
 Implement process to collect enterprise-wide data such as
summary, transaction, financial, operational, and contact data
 Provide ability to capture data from separate product portfolios
 Provide activity based costing data as inputs to customer value
models
 Capture and store customer level info on demographics and
linkages to account relationships in centralized customer
information repositories
 Capture and store customer contact data and back office events in
centralized Customer Activity DB (CA DB)
9

10. Company Vision: Customer Data (continued)
 Capture and store customer strategies and treatments in
centralized and integrated Customer Strategy Profile DB (CSP DB)
 Capture and store transactional customer data (e.g. use of all
products and channels) in a central repository or warehouse
 Refresh or update data regularly (at minimum monthly)
 Provide sufficient (at least 12 months) historical data
 Ensure well-defined and documented, accurate and consistent data
for all customers
10

11. Gaps & Enablers: Customer Data
Area Objective: Provide the tools and data needed to manage a customer profitability based
organization
CRM Area End State Requirement Gap Enablers Gap Size
Customer 1. Achieve a common definition of a 1a. MCIF has customer • MCIF
Data customer, including all of its defined by SSN and HH
potential levels- account, individual, but not all products are
and household captured (e.g. loan, safe
deposit, trust, debit
card)
1b. MCIF does not store
the SSN of
joint/secondary holder
2. Capture data to measure customer 2. No definition of
value for all customers on a regular customer value exists
basis (at least monthly)
3. Use customer value and predictive 3a. No cross-LOB customer • New profitability system
models as inputs to enterprise-wide models exists • Credit application
customer value segmentation scorecard
3b. No centralized QA/policy
scheme and treatment definition
for model development, • Needs-based
• Update segmentation inputs evolution and maintenance
segmentation proposed
regularly
3c. No statistical modeling based on BAIGlobal
• Maintain, validate,and refine expertise in-house study
segmentation inputs • Harland attrition,
3d. No statistical modeling
software (e.g. SAS) in- propensity-to-cross-sell
house and PTB models
KEY
No Gap - Provident has all capabilities in the area Significant Gap - Provident has few capabilities in the area
Minor Gap - Provident has most capabilities in the area Major Gap - Provident has no capabilities in the area
Moderate Gap - Provident has some capabilities in the area
11

12. Gaps & Enablers : Customer Data (continued)
Area Objective: Provide the tools and data needed to manage a customer profitability based
organization
CRM Area End State Requirement Gap Enablers Gap Size
Customer 4. Implement process to collect 4. No such process exist • Data feeds of MCIF
Data enterprise-wide data such as • Horizon
summary, transaction, financial,
operational, and contact data
• Provide ability to capture data
from separate product
portfolios
• Provide activity based costing
data as inputs to customer
value models
5. Capture and store customer level 5. Systems of record exist • Horizon RMS
info on demographics and linkages (Horizon RMS), but
to account relationships in data quality issues need • Duplicate Resolver
centralized customer information to be addressed (e.g.,
repositories duplicate records)
6. Capture and store customer contact 6. Limited customer • Horizon
data and back office events in contact data captured
centralized Customer Activity (CA today
DB)
7. Capture and store customer 7. No customer strategies • Horizon RMS
strategies and treatments in and treatments data
centralized and integrated Customer exists today
Strategy Profile DB (CSP DB)
KEY
No Gap - Provident has all capabilities in the area Significant Gap - Provident has few capabilities in the area
Minor Gap - Provident has most capabilities in the area Major Gap - Provident has no capabilities in the area
Moderate Gap - Provident has some capabilities in the area
12

13. Gaps & Enablers : Customer Data (continued)
Area Objective: Provide the tools and data needed to manage a customer profitability based
organization
CRM Area End State Requirement Gap Enablers Gap Size
Customer 8. Capture and store transactional 8a. Limited transitional • Horizon
Data customer data (e.g. use of all information captured (e.g. no
products and channels) in a central data on rebates by fee type)
repository or warehouse
8b. Data captured in separate
• Refresh or update data
control files that are
regularly (at minimum application specific
monthly)
• Provide sufficient (at least 12 8c. Some channel info is
months) historical data incorporated in transaction
codes (e.g. cannot
differentiate if funds transfer
via IVR or Web
8d. Transition data from before
conversation is kept
separately)
9. Ensure well-defined and 9a. MCIF, Loan Station not well • Horizon database well
documented, accurate and consistent documented documented and
data for all customers defined
9b. Contact management not
well defined (uses free text
notes)
9c. Duplicate customer records
and multiple addresses exist
in Horizon RMS
9c. Internet and IVR transactions
are not distinguishable
KEY
No Gap - Provident has all capabilities in the area Significant Gap - Provident has few capabilities in the area
Minor Gap - Provident has most capabilities in the area Major Gap - Provident has no capabilities in the area
Moderate Gap - Provident has some capabilities in the area
13

14. Company Vision: Value Proposition
 Analyze and understand the composition of product holdings for customer
segments
 Continuously analyze and understand customer needs
 Define customer pricing strategies based on customer segment objectives
 Design new product offerings, features and access options based on
customer segment objectives and needs
 Conduct regular marketing and competitive research to support customer
segment management and creation of new offerings
 Adopt rigorous test and learn approach of designing product and service
offerings supported by an analytical process
 Market products in customer-based, coordinated fashion, e.g., consciously
coordinate marketing contacts and marketing budgets for all products and
offerings
 Proactively manage channel usage based on economics and customer
preferences
 Use customer satisfaction measurements to help in the continual
evaluation of strategies, decisions and offerings using test & learn
 Measure success based on combination of product profitability, customer
value, (e.g., customer satisfaction, value, attrition)
14

15. Gaps & Enablers : Value Proposition
Area Objective: Develop innovative product offerings with the flexibility to personalize key features
(e.g., pricing and channel options) according to the customer segment objectives
CRM Area End State Requirement Gap Enablers Gap Size
Value 1. Analyze and understand the 1. Product holding analysis • Harland Study
Proposition composition of product holdings for performed but based
• BAIGlobal Study
customer segments primarily on deposit
holdings and not entire
customer relationship
2. Continuously analyze and 2. Analysis is performed on • BAIGlobal study
understand customer needs ad-hoc basis and is
focused on testing
products and features
3. Define customer pricing strategies 3. No price differentiation
based on customer segment based on customer value
objectives exists
4. Design new product offerings, 4. Product development
features and access options based on not based on customer
customer segment objectives and segments
needs
5. Conduct regular marketing and 5. Research is performed but • Peer Group Study
competitive research to support on ad-hoc basis and is
customer segment management and more product based that • BAIGlobal Study
creation of new offerings customer based
KEY
No Gap - Provident has all capabilities in the area Significant Gap - Provident has few capabilities in the area
Minor Gap - Provident has most capabilities in the area Major Gap - Provident has no capabilities in the area
Moderate Gap - Provident has some capabilities in the area
15

16. Gaps & Enablers : Value Proposition (continued)
Area Objective: Develop innovative product offerings with the flexibility to personalize key features
(e.g., pricing and channel options) according to the customer segment objectives
CRM Area End State Requirement Gap Enablers Gap Size
Value 6. Adopt rigorous test and learn 6. No test and learn
approach in place today • BAIGlobal Study
Proposition approach of designing product and
service offerings supported by an
analytical process
7. Market products in a customer- 7a. Limited coordination with • Centralized module
based, coordinated fashion, e.g., Investment Services today approach
consciously coordinate marketing 7b.Campaigns do not leverage • Marketing budget is
contacts and marketing budgets for centralized
predictive tools (e.g.
all products and offerings propensity-to-buy, etc.)
8. Proactively manage channel usage 8a. Limited channel usage
based on economics and customer information exists
preferences
8b. No channel costs captured
8c. No preferences captured
9. Use customer satisfaction 9. Satisfaction surveys
measurements to help in the conducted for overall
continual evaluation of strategies, satisfaction but not strategy
decisions and offerings using test & or treatment specific
learn
10.Measure success based on 10.Success generally not
combination of product profitability measured based on
and customer value (e.g., customer customer profitability or
satisfaction, value, attrition) satisfaction
KEY
No Gap - Provident has all capabilities in the area Significant Gap - Provident has few capabilities in the area
Minor Gap - Provident has most capabilities in the area Major Gap - Provident has no capabilities in the area
Moderate Gap - Provident has some capabilities in the area
16

17. Company Vision: Customer Contact
 Provide customer contact staff in key functional areas with
customer specific guidance for action and related info and/or
scripting on how to best approach a customer or respond to a
customer’s request
 Provide customer contact staff across the enterprise with consistent
messages and guidance regardless of contact platform
 Enable contact platforms with access to update to Customer
Strategy Profile DB
 Provide customer contact staff with capabilities to record the
offer/action made to the customer and the outcome of the contact
 Include customer value in measure of effectiveness of customer
contact
 Develop consistent sales processes and scripting for all channels
17

18. Gaps & Enablers : Customer Contact
Area Objective: Manage all CRM processes, systems and customer-facing staff and channels that
have any interaction with the customer to deliver a consistent and high quality
customer experience
CRM Area End State Requirement Gap Enablers Gap Size
Customer 1. Provide customer contact staff in 1a. No customer specific • Fairmount sales training
Contact key functional areas with customer guidance exists • Horizon RMS
specific guidance for action and
related info and/or scripting on how 1b.Culture focused on
to best approach a customer or reactive service rather
respond to a customer’s request than proactive needs
based selling
2. Provide customer contact staff 2a. Inconsistency in • Horizon
across the enterprise with consistent customer experience
customer-specific messages and across channels and
guidance regardless of contact products exist
platform 2b. Limited customer
contact platform
capabilities
3. Enable contact platforms with 3. CSP DB does not exist
access to update Customer Strategy
Profile DB (CSP DB)
4. Provide customer contact staff with 4. Limited capabilities to • Horizon
capabilities to record the record customer contact
offer/action made to the customer deposition exists
and the outcome of the contact
KEY
No Gap - Provident has all capabilities in the area Significant Gap - Provident has few capabilities in the area
Minor Gap - Provident has most capabilities in the area Major Gap - Provident has no capabilities in the area
Moderate Gap - Provident has some capabilities in the area
18

19. Gaps & Enablers : Customer Contact (continued)
Area Objective: Manage all CRM processes, systems and customer-facing staff and channels that
have any interaction with the customer to deliver a consistent and high quality
customer experience
CRM Area End State Requirement Gap Enablers Gap Size
Customer 5. Include customer value in measure of 5. Customer value not part
Contact effectiveness of customer contact of contact effectiveness
measures
6. Develop consistent sales processes 6. LOBs/channels have • Fairmont Sales training
and scripting for all channels different sales
processes, training, and
scripting
KEY
No Gap - Provident has all capabilities in the area Significant Gap - Provident has few capabilities in the area
Minor Gap - Provident has most capabilities in the area Major Gap - Provident has no capabilities in the area
Moderate Gap - Provident has some capabilities in the area
19

20. Company Vision: Operations
 Enable back office systems with access to and use of customer
strategy info stored in Customer Strategy Profile DB
 Ensure back-end processes and systems have capability to execute
consistently differentiated customer strategies and treatments
 Provide scalable and flexible operational environment to support
changes in customer specific strategies and treatments
20

21. Gaps & Enablers : Operations
Area Objective: Ensure consistent administration and execution of customer strategies and
treatments
CRM Area End State Requirement Gap Enablers Gap Size
Operations 1. Enable back office systems with 1. No link between back • Horizon RMS
access to and use of customer office systems and CSP
strategy info stored in Customer (CSP DB does not
Strategy Profile DB exist)
2. Ensure back-end processes and 2. Back-end processes and
systems have capability to execute systems to support
consistently differentiated customer differentiated treatments
strategies and treatments do not exist
3. Provide scalable and flexible 3. Most changes to
operational environment to support Horizon environment
changes in customer specific are not user-driven, and
strategies and treatments depend on Horizon
schedule
KEY
No Gap - Provident has all capabilities in the area Significant Gap - Provident has few capabilities in the area
Minor Gap - Provident has most capabilities in the area Major Gap - Provident has no capabilities in the area
Moderate Gap - Provident has some capabilities in the area
21

22. Company Vision: Organization
 Provide active and visible CRM leadership
 Establish a cross-LOB strategy team with the authority to set
consistent, appropriate, and coordinated customer strategies and
treatments
 Introduce cross-LOB CRM program office structure and processes
 Dedicate staff to coordinate, implement and monitor activities
based on customer value (segment management)
 Designate staff dedicated to CRM result analysis and customer
strategy evolution
 Align performance and incentives across all levels of the enterprise
(e.g., product profitability, customer value, and customer
satisfaction) (customer-centric model)
22

23. Gaps & Enablers : Organization
Area Objective: Manage transition from product-focused to customer-focused organization
CRM Area End State Requirement Gap Enablers Gap Size
Organization 1. Provide active and visible CRM 1a.Complete commitment of • Executive Management
leadership senior leadership is still Team
required
• CRM Advisory team
1b. Customer-centric strategy is
not clearly translated into
action
1c. No clear definition of CRM
across the organization exists
2. Establish a cross-LOB strategy team 2. No cross-LOB customer • CRM Advisory Team
with the authority to set consistent, strategy team exists • Cross LOB teams, such as
appropriate, and coordinated Credit Review Committee,
customer strategies and treatments Write-off and Recoveries
Committee, Game Book
Meeting, etc.
3. Introduce cross-LOB CRM program 3a. Project Management is
office structure and processes decentralized and currently
done by line officers
3b. Project justification and
benefit tracking process does
not exist
3c. Accountability for
business/technology
initiatives is not well defined
3d. Interactions among business
areas is limited
No Gap - Provident has all capabilities in the area Significant Gap - Provident has few capabilities in the area
KEY
Minor Gap - Provident has most capabilities in the area Major Gap - Provident has no capabilities in the area
Moderate Gap - Provident has some capabilities in the area
23

24. Gaps & Enablers : Organization (continued)
Area Objective: Manage transition from product-focused to customer-focused organization
CRM Area End State Requirement Gap Enablers Gap Size
Organization 4. Dedicate staff to coordinate, 4. Segment management • Consumer Segment
implement and monitor activities structure not Management group
based on customer value (segment operationalized
mgmt)
5. Designate staff dedicated to CRM 5. No staff dedicated to
result analysis and customer strategy CRM analysis
evolution
6. Align performance and incentives 6. Performance and HR to follow-up
across all levels of the enterprise incentives measured on
(e.g. product profitability, customer product level only
value, and customer satisfaction)
(customer centric model)
KEY
No Gap - Provident has all capabilities in the area Significant Gap - Provident has few capabilities in the area
Minor Gap - Provident has most capabilities in the area Major Gap - Provident has no capabilities in the area
Moderate Gap - Provident has some capabilities in the area
24

25. One View of The Customer Review
‘One View’ of the Customer
Today’s Date:

Provides a centralized
Demographic Data Deposit Account Relationships
display of a
Customer Type: Retail, Small
DDA: $4321.08
Savings: $8231.80
customer’s entire
Business
Last Update: 3/30/09 - VERIFY
Total Deposit Balance: $12,552.88
relationship, including
Name: Irene Victor
SSN: 123-45-6789
Credit Account Relationships
Mortgage: $89,089.20
and 3rd party data
DOB: 01/01/1961 Personal Loan: $12,324.65
Home Address: Total Credit Balance: $101, 413.85
431 Appleby Dr.
Golden, VA 23029
Business Address: Alternative Investments

Facilitates
35 Main Street
Suite 6
Investments: $14,111.44
Trust: $237,892.95 comprehensive
Smithville, VA 23102
Home phone #: (555) 915-5555
Work phone #: (555) 955-5555
Total Alternative Investment Balance:
$252,004.39 understanding of
Email: ivictor@isp.net
Ancillary Services every customer’s
Offer Pending: Yes
Overdraft Protection: $1,000.00
Safe Deposit Box: No relationship
Debit Card: Yes
Preferred Channel of Contact: Call Internet Banking: No
Center Privacy: True
Last Customer Contact:
3/30/02, Call Center 
Enhances customer
experience
25

26. Customer Strategy CRM Action Profile
Customer Strategy Profile
Offers (Proactive) Opportunities (responsive)
Nam e: Personal Loan Name: Investments

Displays actionable Name: Money Market
Name: Checking
Name: Home Equity
Name: IRA
information based on OID: GD-06-30-2002 OID: MM-06-30-2002
strategic customer Channel: Direct Mail Exp Date: 07-31-2002
ODate: 06-30-2002
segment objectives
Term s: .25% bonus in first 12 mon.
on new bal > $25K
E xp Date: 07-31-2002
Status: Declined
Allows for consistent
Term s: Standard Offer w/ Free online
 bill pay for 6 months
S tatus: Pending
treatment across Account Management
channels and contact Allowabl e Cred it Line Discretion
PID: OD-1234
staff Name: Overdraft Protection
Increase: $500
PID: PL-1234

Allows for contact Name: Personal Loan
Increase: $5,000
staff to update offer Pricing and Fee Management Retention Actions and Activity
disposition – which Allowab le Fee Refund s: A cti on: Flowers sent on 5 yr.
anniversary
can be used in the Amount: $50
Date: 12/21/2002
Fees waived YTD:
next evaluation Amount: $0
Service Guidelines
S ervice Level: High, support phone 555-555-1212
26