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BY: Rutvik Pandya (11BSP0848) Comparison of CRM between HDFC Bank & ICICI Bank

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crm comparison between HDFC & ICICI bank

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Page 1: Crm Comparison

BY: Rutvik Pandya (11BSP0848)

Comparison of CRM between HDFC Bank & ICICI Bank

Page 2: Crm Comparison

ACKNOWLEDGEMENT

I would sincerely like to thank Prof. G.Hugar, Faculty Member, IBS Mumbai for giving me the opportunity to work on this exciting Project of CRM and explore its practical implication.

Rutvik P. Pandya

11BSP0848

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Page 3: Crm Comparison

Table of Contents

Serial No. Topic Page No.

1 CRM: An Introduction 4

2 About ICICI Bank 5

3 CRM at ICICI Bank 6

4 About HDFC Bank 11

5 CRM at HDFC Bank 13

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Page 4: Crm Comparison

Introduction

CRM is an acronym for ‘Customer Relationship Management’. It’s a set of strategies, processes, metrics, organizational culture and technology solutions that enhance an organization's ability to see the differences in its present & prospective customers, track new opportunities to better serve customers and act, instantly and profitably, on those differences and opportunities. Recently CRM has taken a center stage in the business world with businesses concentrating on saving money and increasing profits by redefining internal processes and procedures. It costs a company dramatically less to retain and grow an existing client, than it does to court new ones.

The aim of CRM is to optimize the use of technology and human resources.

CRM services consist of the following major segments:

Consulting services Implementation services CRM Outsourcing services Training services

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Page 5: Crm Comparison

About ICICI Bank

ICICI Bank is India's second-largest bank with total assets of Rs. 4,736.47 billion (US$ 93 billion) at March 31, 2012 and profit after tax Rs. 64.65 billion (US$ 1,271 million) for the year ended March 31, 2012.

The Bank has a network of 2,897 branches and 10,021 ATMs in India, and has a presence in 19 countries, including India. ICICI Bank offers a wide range of banking products and financial services to corporate and retail customers through a variety of delivery channels and through its specialized subsidiaries in the areas of investment banking, life and non-life insurance, venture capital and asset management. 

The Bank currently has subsidiaries in the United Kingdom, Russia and Canada, branches in United States, Singapore, Bahrain, Hong Kong, Sri Lanka, Qatar and Dubai International Finance Centre and representative offices in United Arab Emirates, China, South Africa, Bangladesh, Thailand, Malaysia and Indonesia. Our UK subsidiary has established branches in Belgium and Germany. 

ICICI Bank's equity shares are listed in India on Bombay Stock Exchange and the National Stock Exchange of India Limited and its American Depositary Receipts (ADRs) are listed on the New York Stock Exchange (NYSE).

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CRM at ICICI Bank

CRM at ICICI Bank involves increased communication between the bank and its present and prospective customers. Its philosophy focuses on each and every customer’s satisfaction.

CRM facilitated coordination of multiple business functions & multiple channel of communication with the customers to carry out customer management more efficiently. It also automated the process flow tracking in the product sales process and helped generate customized reports and promote cross-selling.

The typical components of a CRM strategy at ICICI are as follows:

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Develop and customize: In a customer centric business environment, the products and processes have to be according to customers’ needs and preferences. ICICI has always focused on developing channels of service delivery according to customers’ need and service expectation.

Interact and Deliver: To foster a strong customer relationship ICICI ensured that all areas of the bank have easy access to relevant, actionable customer information and employees should be trained on how to use customer information to tailor interactions based on both customer needs and potential customer value.

Acquire and Retain: CRM helped ICICI to figure out valuable customers and made it easy to formulate retention strategies for them. It also helped cope up with the change in customer’s life cycle and offer services accordingly.

Understand and differentiate: Understanding customers is important in order to develop a sound relationship with them. Customer profiling is done in order to understand demographics, purchase pattern and channel preference. CRM also helped ICICI in valuation of its customers to understand customer profitability and Customer Life Time Value (CLV).

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Page 8: Crm Comparison

Implementing CRM at ICICI Bank

The key to implementing CRM was in understanding organization and customers in a better way. There are five interrelated areas that were taken care of before implementing CRM:

Business Focus Organizational Structure Business Metrics Marketing Focus and Technology

Business Focus: There are various components of CRM like customer information, sales, marketing trends and marketing efficacy that acted in tandem to improve relationship between ICICI and its consumers. ICICI captured customer data and analyzed them while dealing with customers at these very touch points. A CRM solution from Siebel was implemented for the automation of customer handling in all key retail products of the Group. The solution allows customer service agents to track all customer complaints and requests. It also allows target setting and centralized tracking of turnaround times for request fulfillment. The solution went live in phases during fiscal 2002. The Bank has also undertaken a retail data warehouse initiative to achieve customer integration at the back-office. This central view of the total customer relationship is being used extensively for identifying opportunities to cross-sell new products and services to the existing customer base.

Technology Focus: ICICI Bank continues to leverage ICT2 as a strategic tool for its business operations to gain competitive advantage. Its technology strategy emphasizes enhanced level of customer services through 24x7 availability, multi-channel banking and straight through processing, and cost efficiency through optimal use of electronic channels, wider and focused market reach and opportunities for cross-selling. The Technology Management Group (TMG) is the focal point for the ICICI Group’s technology strategy and Group-wide technology initiatives. This group reports directly to the Managing Director & CEO.

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Page 9: Crm Comparison

A key to ICICI’s success has been its ability to harness business information to CRM initiatives that have fueled growth and helped attract more than 30 million customers. The foundation for ICICI Bank’s wide-ranging CRM programs is a Sybase IQ-based data warehouse. Developers had used a combination of PL/SQL and BTEQ scripting, a proprietary technology specific to the data warehouse, for data extraction, transformation, and loading (ETL). With its growing customer base, IT administrators recognized that the bank needed a more powerful, sophisticated data integration system to help ensure the warehouse lived up to its potential as an analytic CRM engine that delivered tangible bottom-line results.

To step up to the next level of data integration, ICICI Bank officials agreed with a recommendation from Teradata’s professional services division, which provided systems integration support for the data warehouse, to implement the Informatica Power Center enterprise data integration platform. (The Bank initially used Teradata as its data warehouse platform and migrated to Sybase IQ a year ago.)

ICICI Bank deployed Power Center in 2003 as it embarked on the next phase of its warehouse, which would add data from five new sources, in addition to the initial three sources of retail banking, credit cards, and securities information.

The next step in the CRM implementation process was gap analysis which essentially is assessing different loopholes in:

Marketing, sales and service practices Collection, capture, processing and deployment of customer information Distribution and operations effectiveness at customer touch points

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Page 10: Crm Comparison

Benchmarks

Time-Norms for Various Banking Transactions

S. No. Particulars Time Taken

1 Cash payment Up to 15 minutes

2 Receipt of cash Up to 15 minutes

3 For issuance of demand draft Up to 10 minutes

4 Payment of demand drafts Up to15 minutes

5 Payment of fixed deposit receipts 20 to 25 minutes

6 Opening of an account% 25 to 30 minutes

7 Statement of accounts (request for duplicate) Within 3 working days

Collection of cheques

8 - Local Normally within 4 days

- Outstation Normally within 21 days

In the table, we can see that the benchmarks set by ICICI are definitely of world class and clearly values customer’s precious time. Clearly this has helped ICICI bank acquire a large customer base in a short span of time.

Thus, we see that a focused and customer centric approach helped ICICI Bank become No. 2 bank in India. ICICI has used CRM not only as a tool but also as a strategy to gain competitive advantage over other new generation private banks. It has invested a lot in ICT and spared no pains in giving best to the customers. Its multi-pronged approach towards managing customer relationship is paying dividends constantly and as a result we see millions of happy satisfied customers determined to make it one of the most successful banks in India.

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Page 11: Crm Comparison

About HDFC Bank

The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private sector, as part of the RBI's liberalization of the Indian Banking Industry in 1994. The bank was incorporated in August 1994 in the name of 'HDFC Bank Limited', with its registered office in Mumbai, India. HDFC Bank commenced operations as a Scheduled Commercial Bank in January 1995. 

HDFC Bank's mission is to be a World Class Indian Bank. The objective is to build sound customer franchises across distinct businesses so as to be the preferred provider of banking services for target retail and wholesale customer segments, and to achieve healthy growth in profitability, consistent with the bank’s risk appetite. The bank is committed to maintain the highest level of ethical standards, professional integrity, corporate governance and regulatory compliance. HDFC Bank’s business philosophy is based on four core values: Operational Excellence, Customer Focus, Product Leadership and People.

HDFC Bank operates in a highly automated environment in terms of information technology and communication systems. All the bank's branches have online connectivity, which enables the bank to offer speedy funds transfer facilities to its customers. Multi-branch access is also provided to retail customers through the branch network and Automated Teller Machines (ATMs). 

The Bank has made substantial efforts and investments in acquiring the best technology available internationally, to build the infrastructure for a world class bank. In terms of core banking software, the Corporate Banking business is supported by Flexcube, while the Retail Banking business by Finware, both from I-flex Solutions Ltd. The systems are open, scalable and web-enabled. 

The Bank has prioritized its engagement in technology and the internet as one of its key goals and has already made significant progress in web-enabling its core businesses. In each of its businesses, the Bank has succeeded in leveraging its market position, expertise and technology to create a competitive advantage and build market share. 

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HDFC Bank is headquartered in Mumbai. As on March 31, 2012, the Bank has a network of 2,776 branches in 1,568 cities across India. All branches are linked on an online real-time basis. Customers in over 800 locations are also serviced through Telephone Banking. The Bank's expansion plans take into account the need to have a presence in all major industrial and commercial centers, where its corporate customers are located, as well as the need to build a strong retail customer base for both deposits and loan products.

Being a clearing / settlement bank to various leading stock exchanges, the Bank has branches in centers where the NSE / BSE have a strong and active member base. 

The Bank also has a network of 10,490 ATMs across India. HDFC Bank's ATM network can be accessed by all domestic and international Visa / MasterCard, Visa Electron / Maestro, Plus / Cirrus and American Express Credit / Charge cardholders.

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CRM at HDFC Bank

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In HDFC, the CRM is integrated with core banking solution and offer end to end functionality to effectively address the needs of the complete cycle of marketing, sales and services of banking products.

Key Modules:

Enterprise customer information file.

Sales

Loan origination

Services

Call center

Marketing

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IDEA

OFFER

RIGHT CUSTOMER

CONTACT

INTERACT

FOLLOW UP

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Benefits to HDFC Bank

Aggressive Customer Acquisition

Improved Cross Sell Framework

Increased operational efficiencies and collaborations of lower over cost of ownership

“RIGHT OFFER TO RIGHT CUSTOMER AT RIGHT TIME”

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