SAP Forum & SUGMENA Conference

1. Digital Transformation in Banking
Kashif Al Aziz
Industry Director – Financial Services, SAP
May 11, 2016

2. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 2Public
Bank 2.0
YESTERDAY
Infrastructure, Risk, Processes
Regulation Focused
Paper Documentation, Silo Systems
Disconnected Data
ATMs, Bank Branches
Limited Communication
Bank 3.0
TODAY
Online and Mobile Banking
Digitally Empowered
Anywhere, Anytime
Convenient
Self-service
Product-Oriented

3. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 3Public
Bank of the future
Branch ATM Web Mobile
0 – 1
Visit / Month
3 – 5
Visit / Month
7 – 10
Visit / Month
15 – 30
Visit / Month
The bank of tomorrow
will
not be a place people
go.
Instead, it will go with
them wherever they
go.

4. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 4Public
88%
of customers look for financial
products online.
Empowered customers do their
research at home and open accounts
online
78%
of the total time customers
spend researching credit cards
happens online – an average of
3.5 hours.
62%
of the total time customers
spend researching mortgages
happens online – an average of
11.5 hours
SOURCE – GOOGLE
Source: Google Financial Service Team, September 2013
3%
MOBILE
29%
BRANCH
68%
ONLINE
Account
Openings

5. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 5Public
Market Players are different
19TH CENTURY VS 21ST CENTURY
• AWARENESS
• INTEREST
• DESIRE
• ACTION
SHARE RESEARCH
SHOP
PURCHASE
TRIGGER
EVENT
COMPARE
$20bn spent globally on mobile devices
80-90% of simple products will be purchasable online
and via mobile in the next five years
Source: Bain Consulting

6. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 6Public
Emerging FinTech
companies disrupting
the market, banks are
joining the race…
10% Acquired
07% Subsidiaries
20% Partnerships
43% Startups
20% VC funds
Source: SAP

7. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 7Public
Source: Gartner CIO
Priorities 2016
Digital Bank: Partnerships and Competition…
47% of executives expect their firms to enter
into a partnership with a Google, Amazon or
Facebook in the next 12 months.
49% expect their digital partnerships to
result in a business model change at their firms.
56% believe most companies will have to be
part of a network to leverage technology trends.
50% of executives said their partnerships
have already proven value ‘beyond doubt’.
Source: The Economist

8. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 8Public
Customers are in control of the relationship.
The traditional rules of marketing, sales, and
service are changing.
The customer journey is omni-channel and
complex.
Rules of engagement have also changed …
By 2018, one-third of the top twenty market share leaders in most industries will be
significantly disrupted by new competitors (and ‘reinvented’ incumbents).” Source: IDC

9. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 9Public
What is digital transformation?
Source: Virtrium
Altimeter defines digital
transformation as:
“The realignment of, or new
investment in, technology and
business models to more effectively
engage digital customers at every
touch-point in the customer
experience lifecycle.”

10. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 10Public
Segment of ONE customer

11. IDENTIFY
NEED
RESEARCH
OBTAIN
QUOTE
USE
PRODUCT
CONTRACT
OBTAIN
INFORMATION
ADD
FEATURE
RATE
ITEM
HELP AND
SUPPORT
INVOICING
PROBLEM
MAKE A
PAYMENT
SOLVE
PROBLEM
LOYALTY
BONUS
JOIN
GROUP
COMPLAINT
CHANGE
ADDRESS
ADDITIONAL
PURCHASE
OBTAIN
QUOTE
REFER
FRIENDS
WEB
PRINT
DIGITAL
ADVERTISING
WORD OF
MOUTH
SOCIAL
MEDIA
TV
RETAILERS
WEB
SITE
ANALYSES
KEYWORD
SEARCHES/
ADVERTISING
CONTACT
CENTER
WEB
SITE
E-MAIL
SOCIAL
MEDIA
RETAILERSWEB
SITE
CONTACT
CENTER
CONTACT
CENTER
RETAILERS
CONTACT
CENTER
CONTACT
CENTERSOCIAL
MEDIA
WORD OF
MOUTH
SOCIAL MEDIA
E-MAIL
SUPPORT
PORTAL
?
SUPPORT
PORTAL
?
BRAND
COMMUNITIES
?
Are all customers alike?

12. SOZIALE MEDIEN
FREUNDE
WERBEN
BEWERTUNG
POSTEN
GRUPPEN
BEITRETEN
BESTELLUNG
ÜBERWACHEN
PAKET
ERHALTEN
FEHLENDER
POSTEN
TELEFON
EINRICHTEN
ABRECHNUNGS-
PROBLEM
ZAHLUNG
TÄTIGEN
TELEFON-
SCHADEN
SERVICE
KÜNDIGEN
NETZWERK-
PROBLEM
CHANGE
ADDRESS
ANGEBOT
ERHALTEN
IDENTIFY
NEED
RESEARCH
OBTAIN
QUOTE
USE
PRODUCT
SERVICE
NEU BEGINNEN
KAUFENCONTRACT
OBTAIN
INFORMATION
ADD
FEATURE
RATE
ITEM
HELP AND
SUPPORT
INVOICING
PROBLEM
MAKE
PAYMENT
SOLVE
PROBLEM
LOYALTY
BONUS
JOIN
GROUP
COMPLAINT
CHANGE
ADDRESS
ADDITIONAL
PURCHASE
OBTAIN
QUOTE
REFER
FRIENDS
WEB
PRINT
DIGITAL
ADVERTISING
WORD OF
MOUTH
SOCIAL
MEDIA
TV
RETAILERS
WEB
SITE
ANALYSES
KEYWORD
SEARCHES/
ADVERTISING
CONTACT
CENTER
WEB
SITE
E-MAIL
SOCIAL
MEDIA
RETAILERSWEB
SITE
CONTACT
CENTER
CONTACT
CENTER
RETAILERS
CONTACT
CENTER
CONTACT
CENTERSOCIAL
MEDIA
WORD OF
MOUTH
E-MAIL
SUPPORT
PORTAL
?
SUPPORT
PORTAL
?
BRAND
COMMUNITIES
?
Awareness
Interest
Decision
Purchase
Usage
Purchase
Recommendation marketing
Decision
Usage
SOCIAL MEDIA
1212
Of course NOT …
Because every customer
has a unique approach.

13. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 13Public
Personalized
Offers
Location-
Based
Offers
Real-Time
Customer
360
Segment of ONE customer
Only 6% of banks
are able to personalize marketing using deep
insights on preferences, behavior, sentiments

14. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 14Public
What do you need?
Customer segmentation strategy
Real-time data platform
Smart Analytics:
 Predictive … Social media
 Risk, Credit, Markup etc.
Events stream processing capability
Segment of ONE customer

15. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 15Public
Seamless Banker
?

16. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 16Public
Call Center
Agent
Supervisor
Teller
Self-Service
Kiosk
Universal Banker
Only 11% of FSIs
have a 360⁰ view of their
customers, providing
consistent experience across
all products and channels

17. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 17Public
What do you need?
Omni-channel strategy
Real-time data platform
The right CRM components
Business analytics
Universal Banker

18. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 18Public
Business Networks

19. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 19Public
Payment
Processing
Cash
Management
FXTrade Finance
AP/AR
Automation
Reconciliation
Business Networks
Over $12 Trillion in Spend

20. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 20Public
What do you need?
Business Network Model
Agile Business Connectivity Platform
Simplified User Experience with
Scalability
Business Networks

21. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 21Public
Effective Prudence

22. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 22Public
• Policy Mgmt.
• Process & Controls
• Simulate
• Disclosure & Certification
Compliance
Effective Prudence
Risk
Management
• Identify
• Assess
• Prioritize
• Mitigate
Governance
• Define Policy
• Enterprise Risk View
• Regulations Oversight
• Monitor Performance
31% Lower
Compliance and risk
mgmt. FTEs per
billion US$ in revenue
when issues/reports
are efficiently
extracted and shared

23. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 23Public
What do you need?
Risk governance strategy
Real-time data platform
Business Analytics
Risk data model and framework
Effective Prudence

24. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 24Public
SAP HANA PLATFORM
Customer Experience
Omni-Channels
Workforce
Engagement
Big Data & Internet of
Things
Supplier Collaboration
Business Networks
HANA CLOUD
PLATFORM
SAP FIORI
Digital Core
Transformation
SAP Framework for Digital Transformation

25. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 25Public
Omni-Channels
Unified GRC platform,
Risk Data Model
Business Networks
Data Platform & Analytics
Customer
Segmentation,
Predictive,
Omni-Channels
Straight Through event
Processing
Core of Digital Banking

26. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 26Public
Omni-channel platform
Digital Banking
Financial foundation channel services
(entitlement, messaging, alerts, …)
Digital banking service solutions
SAP Digital Banking Customer Centricity Framework
OData/REST/HTTP
Digital Commerce
Content management
Customer experience management
Commerce
services
Guided quoting
and selling
Channel management services – MA(D)P, MAM
(SAP Mobile Platform: Security, audit, admin, offline data, app lifecycle)
Retail
banking
Commercial
banking
Mobile
money
…
Service-oriented
architecture
INTERNET MOBILE E-MAIL CALL
CENTER
MARKET
PLACES
INTERNET
OF THINGS
CONTACT
CENTER
POS MARKETING
CHANNELS
DIGITAL
GOODS
SOCIAL
NETWORKS
SAP HANA : Real-time Solution
SAP CRM Analytics solutions
from SAP
Core banking solutions
from SAP
Process orchestration and integration
Non-SAP systems
P P
P P P
P
Digital Marketing
Customer data
management
Next best action, Predictive
P
Planning and budgeting
Targeting/customer insight
Cross-channel campaign
execution

27. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 27Public

28. Thank you
Contact information:
Kashif Al Aziz
Industry Director, Financial Services
Riyadh, Saudi Arabia
kashif.al.aziz@sap.com
‫شكرا‬
@SAPFORBANKING
discover.sap.com/digital-banking