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SAP Real Time Analytics Use Cases for BankingAslihan Akin/Jörg BarteltSAP Forum Turkey, September 20th, 2013

© 2013 SAP AG. All rights reserved. 3

Industry & Market Dynamics


Retail and Commercial Banking Value MapComprehensive solutions for commercial and retail banking

Retail Banking Operations

Retail Deposits

Retail Lending

Centralized Payment Processing

Finance Finance TransformationPerformance Management

Finance and Risk Data Management (IFRA)

Collaborative Finance Operations

People andTalent

Core Human Resources and Payroll

Talent ManagementWorkforce Planning and

Analytics

ProcurementSupplier Discovery and Lifecycle Management

Strategic Sourcing and Contracting

Procurement and Order Collaboration

Collaborative Invoiceto Pay

IT ManagementApplication Lifecycle

ManagementIT Infrastructure

ManagementIT Portfolio and

Project ManagementIT Service Management

IT Strategy and Governance

Multichannel

Mobile Customer

Internet Banking

Call Center

Automated Teller Machines

Sales and Service

Customer Acquisition

Customer Management

Social Media Engagement

Risk and Compliance

Credit Risk Management

Liquidity Risk Management

Governance, Compliance and Surveillance

Enterprise Risk Reporting

Commercial Banking Operations

Cash and Liquidity Management

Commercial Lending

Leasing

Financial Services Network

Technology Solutions

Analytics Consumer ExperienceData Management Enterprise Mobility

SAP HANA Platform

Application Develop-ment and Integration


An Innovative Approach to AnalyticsWhat is SAP HANA?

Yesterday Today

Disk

Partitioning

Insert Only on Delta Compression

Row and Column StoreNo aggregatesMemory

++

+ +

Memory

Logging and Backup – Solid State / Flash / HDD

CPU

Multi-CoreMassively ParallelSingleOptimized Platform

64-bit address spacesupports 2TB RAM

100GB/s throughput

Software and data reside on HDD

• IO constraint• Support many platforms• Optimized for None

• Take advantage of latest advances in hardware• Minimum IO time• Optimized for x86 platform

Disk

CPU

+


SAP HANA appliance software

SAP HANA™ In-Memory software + hardware

(HP, IBM, Fujitsu, Cisco, Dell) Data Modeling and Data Management Real-time Data Replication SAP BO Data Services for ETL capabilities from

SAP Business Suite, SAP Business Warehouse (SAP NetWeaver BW), and 3rd Party Systems

SAP NetWeaver as In-Memory app. server

Capabilities Enabled Analyze information in real-time at unprecedented

speeds on large volumes of non-aggregated data Create flexible analytic models based on real-time

and historic business data Build new category of applications (e.g., planning,

simulation) to significantly outperform current applications

Minimize data duplication

SAP HANA

SQL MDXBICSSQL

SAP BusinessObjects

toolsOther query tools

SAP BusinessSuite

Other data sources

SAP NetWeaver Business

Warehouse

SAP HANA Studio and Modeler

SAP In-Memory Database

Calculation and Planning Engine

Row & Column Storage

Real-Time Data Replication

SAP Business Objects Data

Services

SAP NetWeaver

Banking Real Time Analytics Use Cases

Click icon to add picture


SAP Analytics & HANA for BankingUse Cases – Main Categories

Today Banks can run new business, they could never before Manage fraud risk with real time analytics Enhance cross-sell and up-sell opportunities with predictive customer behavior analytics� Discover new business areas for customer specific servicing with sentiment intelligence, etc.

or they can better run their current business (time-to-market, TCO)


Business Analytics Scenarios in Banking

Fast and accurate Risk Reporting

Support regulatory Compliance

Manage liquidity risks in real time to compare asset values globally

Real time fraud detection & action

Real Time Analytics in Capital Markets

Core Applications

Sales, Service, Marketing

Financial Accounting

Operations and IT

Improved customer service (e.g. spending analysis)

Advanced analysis capabilities

Real time operational reporting

Optimize marketing campaigns with customer segmentation and channel analytics

Enhance cross sell opportunities with customer behavior analytics

Use real time branch sales analytics to manage by exception

SAP Customer Engagement Intelligence

Accelerated global Financial Reporting

Predictive modeling analytics for finance

Customer retention and acquisition

Support regulatory requirements

Financial analysis on massive data sets

Reduce overall cost of information and IT staff support

Improved IT support

Improve quality of master data

Improved financial management

Strategic Workforce Planning incl. simulations and Reporting

Risk Management


SAP HANA for Banking use case examplesTransactional Banking






Transactional Banking



Operations and IT














Improved IT support



Risk Management


Use Case: Credit Card Analytics and Fraud ManagementEnabled by Custom Development and SAP Fraud Management

Description Credit Card operator performs analytics on

massive data marts

Current situation Cannot perform analytics on current data

volumes in reasonable time

Value proposition Allow for data mining of transaction data Ad hoc analysis on large volumes of non-

aggregated data Detect Fraud

Result Enhanced customer analytics for Financial,

Marketing, Customer Service organizations Fraud Reduction

BI Tools

• Data Provisioning

and Integration

Operational

Systems (SAP and non-SAP)

Transactional

CardsDetection and

Alerting

Investigation and Decision

SAP HANAIn-

Mem

ory

...


SAP HANA for Banking use case examplesSales, Service and Marketing









Operations and IT














Improved IT support



Risk Management


Use Case: Channel Analytics and Customer Segmentation Enabled by Custom Development and SAP Predictive Analysis

Description Manage communication with customers via

different channels (ATM, call center, online banking, mail, branch, ...)

Current situation Massive scale of data mart prohibits

analytics to be performed in a timely manner.

Value proposition Understand customer behaviors and trends

in real time

Result Conduct churn management to minimize

loss of customers Gain insights with advanced statistics Optimize targeting and customer

segmentation Anticipate customer behaviors and make

personalized offers and promotions

SAP Predictive Analysis


Use Case: Accelerate your Insight into Market Sentiments Enabled by SAP Sentiment Intelligence

Description Analyze your sources and channels and gain

more insights

Current situation Increased data volumes through

unstructured data.

Value proposition Data harvesting from social media like

Twitter, Facebook, blogs etc Text data processing capabilities for

aggregation and insight into unstructured data

Result Gain insights into customer requests for lead

generation, product/service issue and topics/context around market sentiments

Be proactive to improve your customer satisfaction

CRM(SAP and Non-SAP)

Online text sources

Social media

Sentiment Intelligence

SAP Data ServicesData Extraction

Transfer and Loading

(ETL)

UI5/Toolkit, BI, Visual Intelligence

Insight to Action

SAP HANAText Analysis

(NLP)SI Models & Views


SAP HANA for Banking use case examplesRisk Management









Operations and IT














Improved IT support



Risk Management


Use Case: Liquidity Risk ManagementKPIs with Real Data - Impact on End to End Processing

End to End: 48 hours

10 mins 10 sec

=> Speed not for the sake of speed but to create tangible benefits

60+ minutes

1 second

220 Mio Cash Flows

StandardHANA

4.000x faster

End to End:

From 2 days down to 10 min

“Proposed intraday liquidity reports ‘not feasible’, banks say. Basel Committee's proposed new reports on daily liquidity needs would involve "thousands upon thousands" of data points.

Risk Magazine, Sept 2012


Monitor key performance indicators

Manage alert workload with efficient evaluation, qualification and remediation of fraud

Execute mass and real-time detection and stop suspicious business transactions

Define fraud detection strategy through simulation and calibration

Analyze fraud patterns and define detection rules and models

Use Case: Achieve effective fraud managementEnabled by SAP Fraud Management powered by HANA

SAP HANA

In-Mem

ory

* Can be preformed with SAP HANA studio, SAP Predictive Analysis (option) or 3 rd-party tools

BI Tools

• Data Provisioning

and Integration

Operational

Systems (SAP and non-SAP)

Transactional

CardsDetection and

Alerting

Investigation and Decision

SAP HANAIn-

Mem

ory

...

High performance processing of very large data volumes


SAP Rapid Deployment solutionsExample: Enterprise Risk Reporting

Fast & Simple

• Gain fast time to value with seamless rapid-deployment tools, embedded best practices

• Speed end-user adoption with guides and educational materials

Example: Enterprise Risk Reporting RDS

A complete solution

Deployed in weeks


SAP HANA for Banking use case examplesFinancial Accounting









Operations and IT














Improved IT support



Risk Management


Use Case: Real Time Daily Balance and Line Item DetailEnabled by Custom Development

Description Point in time Spot & Average Balance

calculations and Liquidity position.

Current situation No Intra Day insight into Financial Position

across Spot and Average Balances

Value proposition Provide real time access to financial

operational key figure reporting

Result Real Time informed decisions regarding

opportunities and risks by managing Balance Sheets

Bank Sub-

ledger


Use Case: Real-time Financial Reporting/AnalysisEnabled by Custom Development

Description Real-time financial reporting/analysis allowing

organizations to understand their current financial position and management to quickly adapt to opportunities and address problems.

Current situation Financial closing often requires week. Slow

financial results are not as actionable as it could be if received sooner.

Value proposition Analysis of the factors (down to transaction

level) that drive revenues, expenses and shareholder value across product, customer, channel, etc.

Result Improve financial performance by implementing

more effective financial management. Enabled by custom development


Use Case: Finance & Risk Data ManagementReasons to rethink the Information Management Landscape

Transports

SO

A/E

nt. S

hare

d S

ervi

ces

Bac

kbo

ne

SO

A/E

nter

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Bac

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Metadata ManagementEnvironment

External Datasources

Transactional Data Sources

(Internal Sources within ICG, GCG, PB, LCB)

Reference/MasterData Sources

(Includes LOB OperationalMaster data)

Centralized Staging Area

Data Acquisition Data Integration Information Access and DeliveryData Storage and Aggregation

ValidationCleansingMatchingDeduping

CertificationControl & Audit

IntegrationTransformation

AggregationCalculation

Reconciliation

A

Application

Process

Repository

Capability

Landing Zone

C/ER/F ODS

Adjustments / Restatements /

Corrections

Regional DataSources

(LATAM, EMEA, NA, APAC)

A

DQ2

BR

Data Quality ManagementFramework

Data Quality Learning Repository

Data Profiling

Quality Rating

DQ Reporting & Dashboarding

Data CleansingRecord Level

Validation

Business Rules Processing/ Management

Business RulesRepository

Common RulesProcessing

Business RulesEngine

DQ1 BR

Lineage Analysis

Impact Analysis

Metadata Reporting

Business Taxonomy

Metadata Capture

Metadata Search

MetadataRepository

Metadata Integration

Information Consumers & Processors

Operational Data Store (ODS)

Data Warehouses

Data Marts

SO

A/E

nter

pris

e S

hare

d S

ervi

ces

Bac

kbo

ne

Data Security and Privacy Management

Encryption Obfuscation

Audit & ControlIdentification

Audit Repository

Role based Access/Mapping

AuthenticationAuthorization

Data Federation

BC

App. Write-backB

OLAP

Query & Reporting

Business Analytics

Data Mining / Predictive Analytics

Data Delivery Services

Notification and Alerts

Calculation Engine/Services

Dashboarding/Scorecarding

Adjustments/updates/Corrections Access Point

Enterprise Search

Enterprise Portals

Event Processing

Business Access Platform

Business Intelligence Platform13

4

5

7

6

8

9

10

11

12131415

Data Acquisition Gateway Data Integration Platform

Near real time messages

Untransformed Data

(per Bus Req)

File Level Validations

DQ2

CommonData

Layout(CDL)

Processor

Analytical Platform

Data Access Platform

MM

MM

SO

A/E

nter

pris

e S

hare

d S

ervi

ces

Bac

kbo

ne

MMC

SP

SP

SP

Reference and Analytical Hierarchy Management

Reference Data Repository

Reference Data Validation

Golden/Master Record Generation

Reference Data Enrichment

RAHM

16

Products Arrangements

Involved Party Location

Event ClassificationAssoc.

RelationshipCondition

Profile Area

Regulatory/Compliance

Resource Item

Summary Area

17

18

ComplianceData Mart

(Trade SurveillanceDue Diligence

AML Monitoring)ComplianceRegulatoryReporting Data Marts

Treasury & Cash Mgmnt

Data Mart

Tax Management

Data Mart PerformanceManagement

Data Mart

Legal VehicleFinancials Data Mart

Credit RiskData Mart

Market RiskData Mart

Operational Risk

Data Mart

Messaging( Real Time )

DBMS

Web Service

SQL Client

File(Batch, intra-day batch, mini-batch

etc)

Real Time Messages(no persistence / no validation)

2

Customer ISG (Wholesale)

CMR (Retail)

Product

Organization

Price/Market Data

Data Sources

LOB Data Sources(Sector owned)

Business Sectors Global Functions

FinanceRegulatory

Reporting Marts

ValidationControl & Audit

IntegrationTranformation &

Aggregation

Messaging(Peer to Peer,

Near Real Time, Pub/Sub )

File(Large Batch)

Real Time Messages

DQ1

Metadata

Business Rules

Security

To Data Marts/Analytical Platform via Data Access Platform

Messaging(Batch)

DQ1

DQ1

DQ1

DQ1

DQ1

DQ1

DQ1

DQ1

Process Quality

Adjustment Calculation

Pricing Calculation

Engine

Match & Merge

Reference Data Synchronization

Legend

Reference Data

Transport Pattern

Data Monitoring

RAHM

C

B

Real Time data (from web services)

DW OuputODS Output

Data Mart Output

BPM/BAM/Workflow Monitoring

Financials / Performance

DW

Human

Capital DW

Wholesale Contracts /

Positions DW

Consumer Contracts /

Positions DW

Wholesale

Transactions DW

Consumer

Transactions DW

Customer / Legal Entity DW

Reference Data

·

Compliance

· Mantas (Trade Surveillance) · Web Pre-Clearance · METSS (Monthly Employee Trading Supervision System) · OARS (Outside Activity Reporting) · Mantas (Anti-Money Laundering) · SAS Analytics · QuickScreen Case Management · SAR (Suspicious Activity Report) Database · Actimize (Sanction and Name Screening)· SPIDER (Local Disclosure of Interest Reporting) · WIN (Want it Now) · Electronic Banking System (EBS)· Shamus (Fair Lending Risk Mgmt.)· CRA (Community Reinvestment Act) Wiz· Fair Lending Wiz· Management Dashboard

Target State Applications

Enterprise Risk

· Wholesale Risk Management/Regulatory Reporting· Wholesale Credit Risk Management Dashboard· Retail Risk Management/Regulatory Reporting Application· Retail Credit Risk Management Dashboard· Market Risk Management Dashboard / Scorecard· Market Risk Management and Regulatory Reporting· Operational Risk Management and Regulatory reporting and

Management Dashboard/Scorecard· Enterprise Risk Dashboard/Scorecard

Finance

· Citi Franchise Database · Contracts/Positions/Balances Warehouse· Counterparty Information Warehouse · Expense Warehouse · Financial Consolidation · International Regulatory · Intra Citi Billing · Management Dashboard · Tax Application · Treasury Application · US Regulatory

Compliance

· eCADD (Electronic Customer Acquisition & Due Diligence)

Enterprise Risk

· Credit Evaluation & Approval Applications · Credit Administration Workflow Integration Applications· Collateral Management and Monitoring Applications· Document Management Application (Banking Book) · OTC Derivatives- Documentation and Management · Securities Financing -Documentation Management · Disbursement Approval and Control Application · Credit Trading Book Limit Management and Monitoring· Collections and Recovery Applications · Economic and Regulatory Capital Calculation Engines · Exposure Aggregation Engines· Wholesale Credit Analytics Applications - (Capital Adequacy, Stress

Testing, Portfolio Limits, Loan Loss Allowance, Loss Forecasting)· Retail Credit Reporting & Analytics - (Capital Allocation, Stress

Testing, Portfolio Limits, Loan Loss Allowance, Loss Forecasting, Collections Analytics, Fraud Analytics)

· Market Risk Capital Calculation Engines· Market Risk Limits Manager· Market Risk Reporting & Analytics - (Capital Adequacy, Stress

Testing, Portfolio Limits, Loan Loss Allowance, Loss Forecasting)· Operation Loss Event Data Capture Application and Issue

Management Application · Risk Control Self-Assessment Application· Operational Risk Loss and KRI data Aggregation Engine · Operational Risk Capital Calculation Engine · Operational Risk Reporting Analytics - (Capital Adequacy, Stress

Testing, Portfolio Limits, Loan Loss Allowance, Loss Forecasting)

Compliance

· Product Control Applications · Accounting Engine · Budgeting & Planning · Finance Rules Engine · Fixed Assets · General Ledgers

Read only Applications

Write-back Applications

Consolidation of system landscape Getting rid of silos and consolidate the

application landscape on one data platform

Modernization Oppenness for integration of new solutions Flixible to extend scope

Leverage potential of technology innovations In-Memory Zero data latency Less materilaization and more virtualization

of data layers

Harmonization of technology stack Rely on a fully integrated technology stack

and reduce diversity of technologies

Address regulatory requirements efficiently Industry Best-Practices (Template approach)


SAP HANA for Banking use case examplesOperations an IT









Operations and IT













Improved IT support


HR – Retirement Planning

Strategic Workforce Planning incl. simulations

Risk Management


Use Case: Improved IT Support and reduced TCOEnabled by SAP HANA as primary or secondary database

HANA as secondary database

Data replication

HANA DB

Reporting+

Application

Classic DB

Application

HANA as primary database

HANA DB

No data replication

Reporting+

Application

Application

Description Usage of in-memory databases to improve

service support Streamlined system landscapes

Current situation Complex system landscapes and huge

data duplications Continuous cost pressure

Value proposition Streamlined system landscape through

direct access without need for duplications Fast access for Business Users to all

relevant data

Result Improved IT Service Simplified landscapes resulting in lower

TCO

… and beyond



Extend Your Analytics Capabilities with Prediction

ANALYTICS MATURITY

CO

MPETIV

E A

DVA

NTA

GE

Sense & Respond Predict & Act

Raw Data

Cleaned Data

Standard Reports

Ad Hoc Reports & OLAP

Generic Predictive Analytics

Predictive Modeling

Optimization

What happened?

Why did it happen?

What will happen?

What is the best that could happen?

The key is unlocking data to move decision making from sense & respond to predict & act


… SAP HANA Predictive Ecosystem

SAP HANA Platform

Data Pre-Processing and Loading

SAP Data Services, Information Composer, SLT, DXC, Hadoop

Predictive Analysis Library

(PAL)SAP HANA Studio

SAP and Custom

Applications

R Integration for SAP HANA

Business Intelligence

Clients

SAP Predictive Analysis


SAP Extends the Power of Predictive Analytics to Unlock Big Data With Acquisition of KXEN, September 10th 2013

Some Customer Examples



Business Warehouse on HANA:BW on HANA LIVE: Three Customer Examples

�Better monitor credit risk and manage the portfolio of property loans

Offer better services through comprehensive customer insights

Credit Risk & Portfolio Analysis Customer Servicing

Business / IT Scenario:

Obtain Customer Credit Information

Ensure Internal and external regulatory requirements

Value Proposition

Ensure Compliance

Improved Management Reporting

Risk Transparency

Compliance & Risk Management


Business Scenarios based on HANAAccelerate and improve Business Processes


Risk Management including ad hoc simulation capabilities

Consolidation of data and reporting

Value Proposition

Accelerated Reporting (from 4 hours to 4 min.)

Consolidation of data and reporting

Less Manual effort

Consolidated IT landscape


Customer Analytics based on different data sources

Faster Access to relevant information

Value Proposition

Improved Customer Service

Acquire and retain customers

Increase Profitability

Consolidated Reporting Customer Servicing & new business

5,000 events per second loaded onto SAP HANA

10-30% increase in revenue per year. Interactive data analysis leading to improved design thinking and game planning.

Increase conversion rates from freeto paying player

Increase the average revenue per paying player

Decrease churn – keep paying players playing longer

Customer Behaviour Analysis

Summary/Closure



Bringing Together Business And Analytics/Big Data Solution

Develop Transformation Map• Develop & Schedule Next Project Steps to

Achieve the Defined Strategic Objectives• Cost Benefit Analysis• Final Presentation

Identify Use Cases with Innovation/Discovery Workshop• Identify Top pain points to be solved• Identify Value Proposition why is it important

Define Strategic Architecture & Governance• Design To Be Architecture and align with Strategy • Define future Governance/Guidelines and Competence Centre Organization & Processes

Align Vision And Strategy • Align Strategy and Business Strategy• Identify Pain Points and Consequences• Define Success Factors and KPI to Measure Strategy

Run Rapid Deployment Sol.• Develop POC Prototype or start with RDS


Conclusion: Real Time Analytics & Big Data for Banking

Real time on-demand access to source data helps banks & insurances identify customers and products, analyze risk, optimize performance, and limit fraud.

Enterprise wide integration architecture for processes and data flows is a pre-requisite to solve big data problem.

Innovative technology enables actionable insight with massive quantities of real time

data in the main memory of the server to provide immediate results from

analyses and transactions

Jörg BarteltPrincipal Architect (Analytics/HANA)

Global FSI Delivery Services

SAP AGDietmar-Hopp-Allee 16

69190 Walldorf

T +49-6227-7-66855

M +49-160-90823047

E [email protected]

www.sap.com

Aslıhan AkınSolution Manager – Banking Industry

SAP TÜRKİYE, Anel iş Merkezi Saray Mah. Site Yolu Sok.

No:5/17 K:6, 34768

Ümraniye / İstanbul

T +90 216 6330434

M +90 530 1730437

E [email protected]

www.sap.com

mailto:[email protected]

Download - SAP - FİNANSAL HİZMETLERDE ANALİTİK DÖNÜŞÜM - SAP Forum 2013

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