HNC Software Inc., a leading provider of high-end analytics and decision management software, announced that People’s Bank, a Connecticut-based bank with a national credit card operation, will implement HNC’s Profit Manager software as a critical component of its new customer relationship management initiative.
“Measuring and deploying customer profitability information for effective cross-selling and the overall optimization of customer treatment strategies will be a crucial aspect of our overall CRM program,” said James Sheridan, People’s Bank senior vice president of customer relationship management. “After reviewing several customer profitability systems, we found HNC’s Profit Manager software to be the most sophisticated and selected it as the cornerstone of our CRM initiative.”
Profit Manager software calculates the profitability of customers, relationships, products and business units. The system incorporates an interface to core accounting and banking systems, and guards the integrity of profitability measurement through matched-maturity funds transfer pricing and sophisticated cost-allocation methods, including activity-based costing. The system can also be used to conduct valuable “what if” scenarios and customer simulations to facilitate optimized CRM strategies.
“People’s Bank’s ability to generate funds transfer pricing and assemble customer fee income, customer activity cost drivers and functional standard costs from several diverse data sources results in rapid and significant customer and product performance differentiation,” said Richard Ciolli, a principal business consultant with HNC Software.
Traditional measures of customer profitability often include variables such as high average balances, demographics and multiple account relationships, but do not account for the actual cost of providing the services and channels that customers use. There are segments within segments that warrant different treatment strategies. For example, a customer may have a high balance yet write a high number of checks and visit branches often, while another customer with a similar balance may instead use low-cost channels such as ATMs and the Internet.
“In today’s highly competitive business environment, it is critical that companies do more than merely collect customer profitability information. They must accurately measure, analyze and use it to their maximum advantage,” said Michael Chiappetta, group vice president of customer analytics for HNC Software. “A multidimensional enterprise-wide profitability system is one of the critical technologies needed to manage holistic customer relationships.”
About People’s Bank
People’s Bank (peoples.com) is a diversified financial services company providing commercial, consumer, insurance and investment services. Founded in 1842, it is the largest state-chartered bank in Connecticut with managed assets of $13 billion, 146 branches and 220 ATMs. People’s is a leader in consumer and commercial banking, residential lending, insurance sales, supermarket banking and is the nation’s 15th-largest issuer of MasterCard and Visa credit cards. People’s subsidiaries offer brokerage services, asset management, equipment financing and leasing and insurance services.
About HNC Software Inc.
HNC Software Inc. (Nasdaq:HNCS) is a leading provider of high-end analytic and decision management software that enables global companies to manage customer interactions by converting data and business experiences into real-time recommendations. HNC’s proven software empowers Global 2000 companies in the financial services, insurance, telecommunications, healthcare, and other industries and governments to make millions of the right mission-critical customer decisions, and take action in real time, substantially improving financial performance, reducing costs and decreasing risk. For more information, visit [www.hnc.com].