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Create a decisioning roadmap
A case study on the positive impact of a hosted decisioning environment involves a regional bank that sought to improve the customer experience and increase cross-sell effectiveness through a new instant prescreen decisioning process.
The bank had committed to aggressively grow its credit card business while managing risk and expenses. It decided to take advantage of a previously untapped opportunity to cross-sell credit card accounts at the time a customer opened a deposit account.
The bank wanted the ability and flexibility to add products and services easily for expanded cross-sell opportunities through more banking channels, along with a way to modify its instant prescreen strategies and criteria quickly and easily.
By using a hosted decisioning environment that is connected to the bank’s existing processing systems, with minimal IT involvement and no software installation, the bank had immediate access to sophisticated data and decisioning analytics to make pre-approved product offers to customers as soon as they opened a new deposit account.
This allowed the bank to open new accounts more quickly.
The bank also used a proven decision engine, which provided the flexibility and control to make intelligent, accurate decisions that maximized the value of customer relationships and improved financial performance.
As a result, the bank can instantly approve about 30% of its customers for credit cards as soon as they open new deposit accounts. This enables the bank to expand its credit card portfolio in a risk-mitigated manner while deepening relationships with new customers.
As you think about how hosted decisioning tools can improve your business performance, consider using a decisioning improvement roadmap to drive business results incrementally and iteratively.
Five key factors to consider as you move forward with a decisioning roadmap:
1. Rank, for each line of business, these key business drivers:
- Grow revenue (via acquisition);
- Grow revenue (via cross-sell);
- Grow revenue (via retention);
- Reduce losses (due to bad debt and fraud);
- Reduce operational expenses; and
- Ensure regulatory compliance.
2. Determine which of the following decision areas would most positively impact your key business drivers through an improved decisioning capability:
- Prospecting decisions;
- Acquisition and underwriting decisions;
- Customer management decisions;
- Collection management decisions; and
- Fraud management decisions.
3. Assess your current capabilities (and gaps) for each high-priority decision area relative to these components of the decisioning process:
- Data and data access;
- Predictive attributes;
- Decisions; and
4. Define the decisioning improvement initiatives that will drive significant business value.
5. Implement your improvement initiatives in a phased manner so you can realize measurable business benefits within three to six months.
In today’s competitive business environment, taking advantage of sophisticated hosted decisioning tools can have a significant positive impact on the bottom line while minimizing risk.
Identifying and implementing the right decisioning capabilities to achieve your business objectives is key to ensuring that your organization responds quickly to seize opportunities and respond to the ever-changing business climate.
Roger Ahern is Senior Director of Experian’s Decisioning as a ServiceSM capabilities.