garanti bank -leveraging technology to advance in business

7/23/2019 Garanti Bank -Leveraging Technology to Advance in Business

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Leveraging Technology toAdvance in Business

Eray Yuksek


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Change Journey of Garanti

Harvard Case Study

Garanti Bank: Transformation in Turkeyby Rosabeth Moss Kanter, Daniel Galvin, Maximilian MartinPublication date: Apr 05, 2000. Prod. #: 300114-PDF-ENG

Discusses the complete transformation and turnover in every division ofGaranti Bank. Describes the multiple change projects managed and

cross-cultural issues confronted during the 1990s and the organizational

challenge of transforming Garanti Bank into one of Turkey's premierfinancial institutions


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Garanti in early 90s

Mid size commercial bank

Total 317 branches

Market value was $150 million

Total active assets $1,6 billion

5,900 employee. %32 of employee university graduates.

11 levels in organization hierarchy .

Bank organization is based on products and functions

rather then customer

Issued 43,000 credit cards.

Mid size commercial bank

Total 317 branches

Market value was $150 million

Total active assets $1,6 billion

5,900 employee. %32 of employee university graduates.

11 levels in organization hierarchy .

Bank organization is based on products and functions

rather then customer

Issued 43,000 credit cards.


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4

The challenge of the change at Garanti has been to create a culture which is completelyopposite f the culture prevalent in Turkey. The change was decisive - we had to move fast,and those who could not come to accept the change, were left by the wayside. From theinside out, the view was sometimes chaotic, but it was a systematic chaos.Y.Akn ngr Ex CEO, Garanti

The challenge of the change at Garanti has been to create a culture which is completelyopposite f the culture prevalent in Turkey. The change was decisive - we had to move fast,and those who could not come to accept the change, were left by the wayside. From theinside out, the view was sometimes chaotic, but it was a systematic chaos.Y.Akn ngr Ex CEO, Garanti

Key factors driving innovation andchange

Changing customer expectations

Market conditions

Need for relationship banking

Market share and profitability

IT revolution

Growth

Globalisation

Anticipation of a macroeconomic environmentcharacterised by lower inflation

The Vision

Garanti should become a financialsupermarket

Garanti should stand out among the other banks

in delivering customers what they need andnot what the bank can offer

Therefore the bank has to focus on customersatisfaction

Garantis Change Journey Road Map

Changing the concept of banking

from money managementto financial services to meet

customer needs


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Garanti Romania

1992 1994 1996 1998 2000 2002 2004 2007

RetailBanking

BranchRedesign

CorporateBanking

RegionalOpsCenter

Cash ServiceBranches

CommercialBanking

Acik

CentralForeignTrade Ops

Segmentation

Credit Culture

InvestmentCenters

ADC

CRM

ReshapingBranchNetwork

Abacus SES

Segmentation

EVA

RetailSegmentation

AffluentBanking

BPR IT and

CentralOperationsUnification

SME

Mergers Code ofSales

CommercialSegmentation

Retail ServiceModel

1992 1994 1996 1998 2000 2002 2004 2007

Customer system POS

IVR

Network design &impl.

MS Windows impl.

Paralled Sysplex

Central database

Cheques imagerecognition

Development toolselection

IBM FDM, BDW datamodels

MS Exchange & NTimpl.

Advanced queuemgmt.

Datawarehouse impl.

Fax integration

Image processing&recognition

Sales mngmt tools

Financial AnalysisReport

Java based internetand call centerapplication

Campaignmanagement

Budget system

Electronicworkflow

Datamining

MR-single versionof truth

Customerprofitability

CRM & propensitymodeliing

IMS/DB to DB2

Cardlesstransactions

Coin dispensers

Pocketbank

Blackberryapplications

Data capturing andrecognition

... enabled by advanced technology

Strategic change projects...



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2008 2009

LoanProcess

Mobileinternetbranch

Video Risk

management

Fraudmanagement

Collection

IP Contact Center

Logo entegration

3G applications

Legal Follow up

Strategic change projects...



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Garanti, Integrated Financial Services Co. Focused on Retail

Corporate Commercial SMERetailPaymentSystems

Affluent

Upscale

Mass Market

Medium

Small

Mass

Garanti Bank caters any financial need of itscustomers with having a presence in all business

lines including corporate, private, commercial,SME, retail and investment banking.

Financial Subsidiaries

Garanti operates as an integrated financial services company withits nine subsidiaries offering service in payment systems, pension,

leasing, factoring, brokerage and asset management


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127170

217

288

337

468

2 00 2 20 03 2 00 4 20 05 20 06 20 07 2008 2 00 9 20 10 1Q11

CAGR: 21%

Turkish Banking Sector - Assets & Major Players

Total Assets (US$ bn)

Top 10PrivateBanks:64%

StateBanks:32%

20%

25.01%

40.9%

94.73%

100%

99.84%

100%

519

Foreignownership

%

Top Private Banks by Asset Size 1Q 2011

450

61.93%

613 633

33.98%


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Integrated financial services company

Technologically advanced, innovative and dynamic

Customer-centric growth model, key focus on

profitability and asset quality

Ownership structure:

Jointly controlled by Dou Group and BBVA

51% in the free float

0

10

20

30

40

50

60

70

80

90

100

2002 2003 2004 2005 2006 2007 2008 2009 2010 1Q11

US$Billions

Asset Growth

Total Assets

US$ 90 bn

US$ 597 mn

Branch Network

893

Customer Number

>10.1 mn CAGR: 26%

Q1 2011 Net Income

Garanti - Pre-eminent Banking Franchise


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Leveraging Technology to Advance in Business

A wholly-owned subsidiary of Garanti Bank.

One of the largest IT service providers in Turkey. (900 employee)

Creates tightly integrated and fully in-house developed, custom-fit IT solutionsFocused on banking and financial services

IT services with state-of-the-art information technology

Well-reputed as innovator and visionary

A wholly-owned subsidiary of Garanti Bank.

One of the largest IT service providers in Turkey. (900 employee)

Creates tightly integrated and fully in-house developed, custom-fit IT solutionsFocused on banking and financial services

IT services with state-of-the-art information technology

Well-reputed as innovator and visionary

Business & ITAlignment

Garanti has differentiated itself from others by information Technology...

Innovative customer oriented products and services

Best customer relationship management solutions

Alternative Distribution Channels

Centralized operations

Business Intelligence solutions

Garanti with $90 billion asset size, is recognized for the 11th time as the

Best Bank in Turkey by Euromoney

Innovative customer oriented products and services

Best customer relationship management solutions

Alternative Distribution Channels

Centralized operations

Business Intelligence solutions

Garanti with $90 billion asset size, is recognized for the 11th time as the

Best Bank in Turkey by Euromoney


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Design Principles and Key Features

24x7 Real-time on-line application Banks continue to process business seamlessly as End of Day processing is not a

necessity; it is just for backups, interest accruals and MIS populations.

All updates and inserts are done in real time including Accounting

Modular yet fully integrated solution

Integration at database level. Not Siloed applications

Single Customer View

Compliance with regulatory requirements

Easy of use. Different application views (portals) for differentuser roles


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Design Principles and Key Features

Scalable

The state-of-the-art 3-tier architecture has the capability to handlehigh volumes of transactions from large number of users acrossmultiple channels and modules.

The architecture ensures consistent high performance and quick

response times

Multi -

Currency

Channel

Lingual

Country

Strong Distribution Channels . All channels use same back-end applications forbusiness logic and database access.


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RiskManagem

net

Banking System Architecture

Banking

Application

Single customer database

Integration at the data level

All channels are serviced by in-house developed software and by the same host system

Tightly integratedDeveloped in-house

Softwareenabling

centraloperations

Chan

nel

Manage

ment

BusinessReporting,

BusinessIntelligence

Accounting

Customer Information System

Teller

Budgeting

Feeand

Commission

CashDeliery

Management

Che!ues

"ayments

#FT$S%IFT

Image"rocessing

Securitiesand

Treasury

Consumer

&oans

Commercial

&oans

ForeignTrading

CreditCards

Issuing

CreditCards

Ac!uiring

Collection

D

ocument

Ma

nagement

"rocess

A

utomation

Security System, Fraud ' AM&

Branch

(ffice

AT

M

"(

S

eM

ail

%#B

Mo)ile

De

ices

Smart

"ho

nes

CallC

enter

I*

R

SM

S

Fa+


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1414

Technology Infrastructure

Branch-

Regions

Central(perations

"aymentSystems

Client/Server applications

Internet)anking

./#TApplica.

0iosk

ContactCenter

ATM

Web Based Applications

Mo)ile

Deices

(pera

tions

Parallel Sysplex Architecture

Digital

)ack)one

Digitalcapillarynet1ork

*ideo

systems

*oice

systemsSerice&eel

Management

IT Security

Disaster Recoery

Virtualization & Consolidation

Internet

Infrastructure

Systemsm

anagement

/et1ork

Management

D%

andDataminingB

usinessIntelligence

%orkflo1

DocumentManagement

Intelserers

(fficeAppl.

ClientAppl.

%indo1sclients

Fa+SMS

Mo)ile

2196317

4$(S 5ni+Serers

ApplicationSerers

(racleMS S-&CICS DB6


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Garanti - Multi-Channel Distribution Network

1st in the World to Allow

Money Transfer Via SMS

223k Users wap.garanti.com.tr --1st

internet bank access via

mobile in TR w/o application

downloads or activations

Mobilebank

893 Branches

Presence in 76 Cities:

94% Geographic Coverage

3,160 ATMs

19 mn txs/mo

Cardless Transactions

Coin Dispenser 1.1 mn logins on peak

days

~1.8mn Internet Bank Active

Customers

>750k Log-ins Daily

~13 mn Transactions/mo

Recognized As Turkeys Best

Internet Bank

4.6 mn Calls/mn

>1.1 mn active customers

14 seconds: avg.

response time

256k Sales/mo

Branch Network

Online Banking

Contact CenterATM


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Garanti Technology - Integrated to our Daily Business

Cepbank the first application in theworld that provides money transferservice by mobile phone (2005)

Garanti Mortgage thefirst mortgage call centerwith IVVR system in thebanking sector, enables

customers to have a videocall. (2008)

Bonus Card Turkeys first chip-basedand multi-branded credit card.(2000)

Flexi Card Worlds first flexible credit card,which allows for the customization of allparameters including financial and visual.(2005)

Paperless banking Worlds firstID-scanning application has createda paperless branch, which offers ashareable, easy-to-access and softbranch environment (2006)

Bonus Trink the PayPassfeatured credit card withcontactless chip technology.(2006)

Cepubesi the mobile branchwas launched (2007)

Golden Bonus Card the worlds firstgold - saving credit card (2010)

BonusluAvea Launched the worldsfirst NFC (Near Field Communication)payment enabled SIM card (2010)

Money Card Turkeys first credit cardwhich is multi-branded and also offersbrand-specific loyalty benefits (2009)


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Extensive Business Performance Monitoring

SingleVersion of

Truth

Management information isprovided at all levels forperformance monitoring

Bank level

Business line level

Region level Branch level

Sales person level

Customer level

Platform for management andlegal reporting

A single source of data iscreated to establish a commonunderstanding across the bank

Single data dictionary

Standardized management reports

Consolidated data integration intomanagement reporting platform

CustomerProfitability

BudgetPlanning

IBM BDW data model is used in designing DW

Business Intellligence (Datamining) projects with IBM team

Management reporting and CRM projects with IBM team selected as

finalist in IMS 2001 London event

IBM BDW data model is used in designing DW

Business Intellligence (Datamining) projects with IBM team

Management reporting and CRM projects with IBM team selected as

finalist in IMS 2001 London event


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1818

Number of Transactions / Day (mio.)

Performance Figures for Systems and Operation

Average Internet trx/ Month (7000)

Average daily txs. : 215 million

Peak daily txs. : 270 million

Average response time: 0.042 sec.

91

2007 2008

142150

2009

198

2010 2011

215

8,2869,967

2007 2008

11,327

2009

11,690

2010

12,640

2011

Internet Average trx/month : 12,640,000

Internet Logins/day on peak days :1,209,639

Internet Average response time : 30 msec.

End to end average response time(second)

0,09 0,095 0,12

0,31

0,39

Operation

center

Investment

centers

Branch POS ATM

withdraval


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STA/B5& 2MR IBM Site

GDPS (Geographically Dispersed Parallel Sysplex)/ XRC (Extended Remote Copy) solution

Compliant with GBs Disaster Recovery & Business Continuity plan

25,5 TB total transferred disk size, 4.7 TB daily updated data

Two test slots per year

565 km away from istanbul

Disaster Recovery service from IBM

Istanbul

Izmir


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VIDEO BY TUFAN ALATAN EVP GARANTI TECHNOLOGY

garanti bank -leveraging technology to advance in business

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