Introduction to Retail Bank Management

Introduction to Retail Bank Management
Year One – Chief Retail Officer Perspective Community Leaders

Chief Executive Officer Chief Financial Officer
Executive Banking School Roadmap GROWING Capability Confidence Courage YEAR THREE Chief Executive Officer Perspective YEAR TWO Chief Financial Officer Perspective YEAR ONE Chief Retail Officer Perspective

Year One – Chief Retail Officer Perspective Retail Strategy Curriculum
Leadership Communication Leading the Retail Line of Business via a Balanced Scorecard Discovering Customer Segments & Consumer Behaviors Successfully Communicating & Advertising in Retail Banking Developing and Pricing Profitable Bank Products Modernizing & Optimizing Delivery to Meet Customer Requirements Facing Ethical Dilemmas in Banking Applying Concepts Learned to Today’s Market Chief Retail Officer Perspective

This Session’s Critical Topics
Getting to Know Your Community Better Role of Community Leader Your Scenario Retail Bank MarketSim Your First Decision

Getting to Know Your Community Better
Faculty shares their Strengths – Again, how did you get here and why are you here? What do you hope to get out of this? Plus where are you from and what do you do

Your Faculties’ Top Five Strengths
Getting to Know Your Community Better Your Faculties’ Top Five Strengths

How you relate to people What you need from your partners
Getting to Know Your Community Better Strengths Discussion Name How you relate to people How you get stuff done What you need from your partners Hot buttons

Role of Your Community Leader

Community Leader Role of Your Community Leader
We will be acting as your CEO We love to talk strategy We will challenge your thinking and decision making We will not provide answers or make decisions for you. We will not answer questions in the materials provided in the Getting Started section. We will refer you to those sections. EBS has a commitment to keep its student to faculty ratio low…

Your Scenario

Link content from the simulation to business objectives.
Your Scenario Retail Bank MarketSim Objectives Generate insight into the interplay between customer segments and key retail strategies in product development and pricing, delivery channels optimization and customer communications. Evaluate trade-offs between customer wants and needs and bank management requirements in decision-making while solving to a business plan and Balanced Scorecard measurements. Inspire elevated cross-departmental teamwork and integration with the greater goals of the retail bank. Link content from the simulation to business objectives.

Your Scenario Getting Started You and your management team have just been appointed to run the retail division of a community bank. You and your team will deal with the major issues that face retail bankers such as: Making customer-focused decisions based on their needs in order to build loyalty. Analyzing your bank's current market position, establishing objectives and determining what it will take to succeed. Operating in a hyper-competitive, dynamic marketing environment.

Getting Started You are a team of retail banking professionals.
Your Scenario Getting Started You are a team of retail banking professionals. You are in a community with 4 other banks and a passive bank representing national players, mono- lines and credit unions. You all start in the same place Decisions are tied to Customer Segments, Customer Communications, Delivery and Products Results are shown in the form of financial data Your CEO has said “We must do better” Retail banking professionals, not gaming professional. Trying to “game” the system may not generate your expected results. Making decisions like a retail banker is your best path to success. The simulation was developed by bankers for bankers Passive bank does not make decisions or generate reports. If all teams make great decisions, everyone can grow – if not, customers have somewhere to go

Getting Started: Roles
Your Scenario Getting Started: Roles Chief Retail Officer Chief Financial Officer Marketing Officer Product Officer – Deposits Product Officer – All Other Delivery Officer Teams sitting around a table and making decisions will be hard There is a need subject matter expertise and individual work needs to be done There are six roles and six decisions – you may trade roles if you like and as often as you like Detail are in the Getting Started section in the MarketSim Overview At the very least – everyone should be in charge of a decisions and assume the role of CRO for a turn Teams of 4 (One Product Officer and combine CRO & CFO

Getting Started: Retail Bank MarketSim
Your Scenario Getting Started: Retail Bank MarketSim Very linear and simple

Your Scenario Getting Started: Retail Bank MarketSim Very linear and simple This linear and straight forward view doesn’t tell the entire story

Your Scenario Getting Started: Retail Bank MarketSim Change levers, such as investing in customer marketing, affect appeal along one or more dimensions Downtown Industrial Working Class Start Up Light Industrial New Suburban Trade-Up Old Money Bedroom Community Checking Reg Checking Gold Savings Investments Loans Just Starting Working Poor First House Emerging Affluent Blue Collar The simulation, like banking is multi-dimensional where making a decision has impact across multiple dimensions… Single Income Pre-retired Target marketing decisions (e.g. to Blue Collar Segment) affect appeal across this band High-income M&S Money Mogul

Your Scenario Getting Started: Retail Bank MarketSim Downtown Industrial Working Class Start Up Light Industrial New Suburban Trade-Up Old Money Bedroom Community Checking Reg Checking Gold Savings Investments Loans Just Starting Working Poor First House Emerging Affluent Blue Collar In this case as we try to optimize a gold checking account for blue collar customers, the impact is felt by every customer segment and they will make purchasing and usage decisions along with the blue collar across… Single Income Pre-retired Product Change decisions (e.g. to Checking Gold) affect product appeal across this band High-income M&S Money Mogul

Your Scenario Getting Started: Retail Bank MarketSim Downtown Industrial Working Class Start Up Light Industry New Suburban Trade-Up Old Money Bedroom Community Checking Reg Checking Gold Savings Investments Loans Just Starting Working Poor First House Emerging Affluent Blue Collar …every neighborhood in RetailBankMarketSimVille. Every segment lives in every neighborhood and every segment purchase every product. The differences are in each concentrations. Single Income Pre-retired Distribution Change decisions (e.g. to Light Industry area) affect appeal to customers in cells across this band High-income M&S Money Mogul

Your Scenario Getting Started: Retail Bank MarketSim Downtown Industrial Working Class Start Up Light Industry New Suburban Trade-Up Old Money Bedroom Community Checking Reg Checking Gold Savings Investments Loans Just Starting Working Poor First House Emerging Affluent Blue Collar Through each decision set, you will look to create a targeted, focused group of decisions where doesn’t equal three any longer but 4, 5 or 6. You’re looking to create synergies and exploit opportunities to generate extraordinary results. Single Income Pre-retired High-income M&S Money Mogul

Your Scenario Getting Started: Retail Bank MarketSim And that would be hard enough, but additional there are 4 other banks and the “sixth” bank out there making decisions, changing consumers’ behaviors and changing the market

Your Scenario Getting Started: Retail Bank MarketSim And when you total the 10 segments of nearly 1 million people living in 10 neighborhoods purchasing 21 products you have by any definition a complex system.

Retail Bank MarketSim

Retail Bank MarketSim Simulation Tour If not – do it now Have you been able to log in to: and set up your profile?

Simulation Tour Retail Bank MarketSim
Pay particular attention to Decisions (definitely go page by page for decisions – leave analysis and forecasting alone – hopefully we will format things so they won’t see them) and Results looking at the big 5 reports – Balance Sheet, Income Statement, Customer Report, Product Report and Delivery by Channel Report)

Your First Decision Non competitive To gain exposure to the simulation
To become familiar with the tools Two hours – don’t worry about doing too much analysis – that will come later We’ll be around to help

Assignment This decision is for you to: You have two hours
Your First Decision Assignment This decision is for you to: Gain exposure to the simulation Become familiar with the tool You have two hours Don’t worry about doing too much analysis, but we do expect that you try to make things better Made decisions in all functional areas: Marketing and Communications Product Development & Pricing Delivery Channel We’ll be around to answer any questions Results will be available for your review by 6:00 pm

Questions

Year One – Chief Retail Officer Perspective Retail Strategy Curriculum
Leadership Communication Leading the Retail Line of Business via a Balanced Scorecard Discovering Customer Segments & Consumer Behaviors Successfully Communicating & Advertising in Retail Banking Developing and Pricing Profitable Bank Products Modernizing & Optimizing Delivery to Meet Customer Requirements Facing Ethical Dilemmas in Banking Applying Concepts Learned to Today’s Market Chief Retail Officer Perspective

Chief Executive Officer Chief Financial Officer
Executive Banking School Roadmap GROWING Capability Confidence Courage YEAR THREE Chief Executive Officer Perspective YEAR TWO Chief Financial Officer Perspective YEAR ONE Chief Retail Officer Perspective

Introduction to Retail Bank Management

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