Tuesday, September 30, 2008


Santanu Mishra
The Economic Times

The Advent of information technology (IT) has changed the way transactions are done. Simple banking transactions such as cash withdrawal, which used to consume a lot of time, can now be executed within minutes.

Today, IT has become an indispensable tool for not just banking, but all sectors. Given the phase of consolidation in India Inc, the role of technology has gradually changed. Due to increasing competition, managing information has become strategic in nature for many industries like banking, retail and financial services among others. This is where technology plays an important role by speeding up the process of decision making.

Many of the aforementioned services have been commoditised and it is very important for a company to generate and use the information, which its competitors might not have. The company can use such asymmetric information to gain competitive advantage. People and such data are two of the major assets for industries. Companies can use different analytics tool to convert such data into useful information. Earlier, such works within a company was looked down upon as just another cost centre. But, the situation has changed and now, IT-related work is often under the direct supervision of the senior management.

"At Citigroup, we have two main objectives - delivering value to our customers and leveraging our assets to maximise the benefits," says Ron Guggenheimer, senior director, fixed income analytics, capital markets and banking, Citigroup. In a competitive market, there are number of reasons why a company needs to have an edge over its competitors. One, products and services are being increasingly commoditised and secondly, customer expectations are increasing.

A live example in place is Citigroup, which has changed the business model using the credit card data. The outcome of such use of analytical tools is that it has created business partnership with many retailers. Also, it is better-equipped to predict the consumer behaviour. "Citigroup has partnered with SaS for a long time and the analytics has helped Citigroup for site location, store location, workforce optimisation and finding customer profiles and overlaps among others," says Guggenheimer.

What an organisation needs to create such analytics capability is an enterprise worthy business intelligence and analytics platform. Further, the companies need to speak to the core clients and find out the requirements. Another important question that many organisations face is the return on investment on such analytical tools. Guggenheimer says Citigroup was very careful while selecting its first application. But over a period of time such investments have benefited the organisation a lot and the adoption of new tools have never been an issue for Citigroup since both Citigroup and SaS have shared a long-term partnership.