These young people will be the wage earners of

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Unformatted text preview: perations. A few examples may help to reinforce this point. Take the area of special offers. These may be part of an overall strategy, or could be in response to the actions of competitors. For instance, retail banks are always interested in trying to attract students, for a number of reasons. These young people will be the wage-earners of tomorrow, and today they tend to be short of money and therefore need credit services, so on these characteristics alone they are interesting. It is also easier to acquire a customer who has not yet established a relationship with another bank. Special offers might include free banking, short-term discounted rates on overdrafts and a range of other offers. By utilizing rules to manage these decisions, based on the criteria of whether the operation is on behalf of a student or not, the bank is now in a position to alter the offers at a moment’s notice. So for example, if the offer involves free banking for 12 Page 12 months, and a competitor makes a similar offer for 24 months, all that has to be done is to change the rule covering bank charges to specify that if the customer is a student, make the free period 24 months. No applications needed to change. What could have taken a few weeks can now be done in a few minutes. In the area of corporate banking, the need for agility is also apparent. Interest rates, counterparty risk, liquidity management and foreign exchange movements are just some examples that will affect the decisions being taken in banking operations, and the ability to quickly change the criteria for operational decisions is extremely valuable, potentially saving money, increasing profitability and reducing risk. Agility is also helped in another way. For more complex decisions, for example in the area of trading derivatives, it may be that the business spet will need to do some research and take advice before being able to come up with the new recommendations. The BRMS-supported rules-based decisions approach provides the ability for pooling expert knowledge, in this case in derivatives trading, to quickly come up with the optimal approach to decision-making. Ru...
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This note was uploaded on 01/29/2014 for the course ACC 230 taught by Professor Xia during the Winter '13 term at Bloomsburg.

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