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in'Profitability Management

Overview

In a business environment where challenges and pains are present on every scale, and where profitable revenue and market expansion are at the top of the list, companies today are looking to walk the path to increased profitability and maximized lifetime value.

Indirect costs are increasing; Economies of scale outweigh the overhead of centralized operations. Relationship between resources, activities and revenues is not always easy to make. Businesses experience higher cost and regulatory pressures, stakeholders such as customers, suppliers, shareholders, regulators and society at large demand more transparency. Executive are now experiencing limited visibility into cost and profitability details and dimensions, inefficient cost reporting that fails to provide insights for improving financial performance and annual budgets disconnected from operational reality.

Providentially, valoores’ in’Profit not only tackles these market challenges by presenting the right tools for measuring profitability, but also offers a user driven profitability modeling, with an open, flexible, and easy to visualize modeling environment. Users can follow a suggested path or create their own process to maintain and deploy their cost and profitability models. It leverages a flexible platform to sustain an activity based costing and revenue modeling.

in’Profit suggests an enterprise wide performance management:

Profitability scalability

Address, Calculate & Monitor the profitability from top to leaf level whereas profitability of each customer is accessible through a perfectly designed engine.

Integrated View of Profitability

Provide an integrated view of profitability for key dimensions like Product, LOB/Organization, Customer, Geography and Time… while enabling real-time “What if” scenarios and predicting customer lifetime value.

Profitability Forecasting

Perform forecasting and planning to understand customers needs and propensity to buy new products while getting a 360 degree view of customers and product profiles. In banking, leaders use these analytics to identify and profile attributes of the most profitable customer on the road to finding the “ideal customer” based on their behavior.

Analytics and Decision Optimization

Pinpoint the best offers for the “almost ideal” customers to make them more profitable while predicting the marketing channels these customers will most likely respond to. Use these insights to develop and execute strategies and simulations and drive customers along the road to increased profitability and maximum lifetime value.

KEY FEATURES

Reduced IT workload

  • Real Time Data Consolidation
  • Real Time aggregations & drill down

Institute product management, resource allocation, cost control, budgeting & planning to raise profitability levels

  • Constant monitoring of budgets and Goals
  • Faster response time to problems or gaps
  • Actionable customer & product profitability insight

Reduce Private Information Ownership

  • Enterprise Transparency on staffing, product performance, & business unit performance
  • Increase staff Productivity

Operational efficiency

  • Reduce maintenance fees
  • Target direct efforts (marketing…)

Mitigate Risk

  • Immediate action to set up strategies
  • Mitigating risks & potential risks

Gauge performance

  • Center of Excellence (COE) for BI
  • Measure how well products are priced and performing
  • Measure which customers are creating value & which ones are subduing
    • Holistic overview of customer relationships
    • Customer Centric insights
  • Measure how Bank / Financial Institution are performing at macro & micro levels
  • Gather data from customer channels/ touch points (ATM, Web...)

Profitability per Business Unit

  • Branch, Region, Area & Leadership levels…
    • Real time insight into branch performance

Profitability per LOB

  • Real time insight into enterprise performance per LOB

Value-based Net Interest Income / Margins

  • Capture spread b/w interest earned on assets & interest costs on liabilities
  • Measure interest income (ex: interest earned on loans) against interest expense (interest expensed on deposits)
    • Shed light on Dollar amount of Exposure
  • De-compose spread earned by each division based off FTP rate

Diversify

  • Secure & Drive Multiple Lines of Business
  • Visibility over compartmental profitability

Optimize

  • Return on Assets (ROA): Optimize use of assets to generate profit
  • Return on Equity (ROE): Optimize Net Income out of Equity Capital

Leadership controls

  • Performance Review Management
  • Unify Key Performance & Risk Indicators

Opportunities

  • Top Down & Bottom Up Alignment
  • Timely and Reliable Forecasts
  • Connected Planning Models
  • Understand the value of finance managed solutions
  • “Beyond Finance” vision
  • Drive Best Practices
  • Align Operational Tactics with Financial Targets
  • Better and Confident resource allocation decision-making
  • Reduce Time & Risk to drive out-of-the-box Value
  • Integrated with other Performance Management Applications

KEY BENEFITS

Institute Data Governance to secure information integrity

  • Make data available across the whole enterprise
  • Multi-Directional Information Flow
  • Unique platform for Business Units
  • Business Process Optimization & Threat Control

Introduce Risk Appetite & Compliance at the heart of operations

  • Enterprise Insight on Risk & Compliance
  • Establish Risk Assessment

Cascading Risk Appetite throughout the organization

  • Set / monitor risk appetite at group level

Embedding Risk Appetite into decision making

  • Unify Decisional Process & Track risk appetite

Accentuate Risk Roles & Responsibilities

  • Reinforce Communication Culture

Safeguard regulatory requirements

  • Secure regulatory assessment
  • Document & Validate Contingency plans
  • Secure transparency to regulators
  • Respond to market and regulatory compliance

Reinforce accountability

  • Institute a Validation Cycle & Monitor Processes
  • Socialize Qualitative metrics

    • Clarity on Definition and metrics
    • Link to Business Planning

    Strategic Testing

    • Risk appetite development and management
    • Capital, Business Unit, LOB, & RRP planning

    Stress Testing

    • Liquidity, Credit, Market, Counterparty, Operations, Regulatory, Geographic, & Reputational.

    Alternate what-if scenarios across simulations

    • Compare Simulations at different target levels

    Scenario Management

    • Optimize & monitor What If Simulations
    • Top Down, Bottom up, & Mixed Processes