analytic applications in financial services jennifer toomey senior director
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Analytic Applications in Financial ServicesJennifer Toomey
Senior Director
The following is intended to outline our general product direction. It is intended for information purposes only, and may not be incorporated into any contract. It is not a commitment to deliver any material, code, or functionality, and should not be relied upon in making purchasing decisions.The development, release, and timing of any features or functionality described for Oracle’s products remains at the sole discretion of Oracle.
Agenda
• Oracle in Financial Services• Industry Challenges in the Spotlight• Roadmap to Management Excellence • Q&A
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Oracle in Financial Services
Financial Services Customers Using Oracle Analytic Applications
Capital MarketsBanking Insurance
1998 20072005
Financial Consolidations, Budgeting & Planning
Basel II, Economic Capital, Credit Risk, Operational Risk
Transactional Analytics, Anti-Money Laundering,
Broker/Dealer Compliance
Multidimensional Profitability,Funds Transfer Pricing,
Asset Liability Management,Balance Sheet Planning
2006
Customer Analytics,Business Intelligence
Activity-Based Management, Funds
Transfer Pricing, Financial Services Data Warehouse
TreasuryServices
Investment in Market Leading Analytic Applications for Financial Services
Oracle Analytic Applications for Financial Services
Governance & Compliance
Credit RiskPerformance Management
Marketing
Governance Retail Credit Risk Multidimensional Profitability Portfolio Analytics
Compliance Risk Corporate Credit Risk Customer Profitability Marketing Analytics
Regulatory Compliance Treasury Risk Funds Transfer Pricing Service Analytics
Anti-Money Laundering Market Risk Finance Channel
Trading Compliance Asset Liability Management Balance Sheet Planning Channel Usage
Broker Compliance Regulatory Capital Budgeting & ForecastingChannel Performance
Sales Analytics
Fraud Detection Basel II : Credit Risk Consolidation
Operational Risk Basel II : Market Risk Accounting Hub
Operational Risk Basel II : Operational Risk
Economic Capital
EC : Credit Risk
EC : Market Risk
EC : Operational Risk
Specialized AnalyticsInsurance
Credit Cards
Mortgages
Enterprise Performance Management
Enterprise Performance Management
Customer Insight
Customer Insight
Governance Risk & Compliance
Governance Risk & Compliance
Enterprise Risk Management
Enterprise Risk Management
Oracle Positioned in Leaders Quadrants
The Magic Quadrant is copyrighted 2008 by Gartner, Inc. and is reused with permission. The Magic Quadrant is a graphical representation of a marketplace at and for a specific time period. It depicts Gartner's analysis of how certain vendors measure against criteria for that marketplace, as defined by Gartner. Gartner does not endorse any vendor, product or service depicted in the Magic Quadrant, and does not advise technology users to select only those vendors placed in the "Leaders" quadrant. The Magic Quadrant is intended solely as a research tool, and is not meant to be a specific guide to action. Gartner disclaims all warranties, express or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.
These Magic Quadrant graphics were published by Gartner, Inc. as part of larger research notes and should be evaluated in the context of the entire reports. The Gartner reports are available upon request from Oracle.
Sources: Gartner, Inc., “Magic Quadrant for Business Intelligence Platforms, 2008” by James Richardson, Kurt Schlegel, Bill Hostmann, Neil McMurchy, 1 February 2008Gartner, Inc., “Magic Quadrant for CPM Suites, 2006 “ by Nigel Rayner, Neil Chandler, John E. Van Decker, 19 December 2007Gartner, Inc., “Magic Quadrant for Data Warehouse Database Management Systems, 2007” by Donald Feinberg and Mark A. Beyer, 10 October 2007
Magic Quadrant for Business Intelligence
Platforms, 2008
Magic Quadrant for CPM Suites, 2007
Magic Quadrant for Data Warehouse Database
Management Systems, 2007
Reveleus in Risk & ComplianceReveleus Basel II Solution emerges as the market leader
• Reveleus was named as a leader in Gartner’s Magic Quadrant• Tower Group named Reveleus the “crown jewel” of i-flex and
ranked Reveleus Basel II highest• Celent group considers Reveleus as the North American Market
Leader in Basel space
August ‘05
December ‘05
January ‘06June ‘06
Oracle’s Financial Services Strategy
Oracle’s Strategy and Vision is based on the view that the only way to bring a wide range of domain specific software capabilities to market is through:
• Developing and acquiring the most complete set of “best of breed” functional capabilities available from any one single vendor
• Pre-integrating these “best of breed” solutions through process based integration to reduce complexity and cost for the customer
• Standardizing and converging over time the “integrated best of breed” solutions onto a common, open technology architecture
• Building an ecosystem of system integrators to complement our own capabilities for platform lead implementations
© 2008 Oracle Corporation – Proprietary and Confidential11
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Industry Challenges in the Spotlight
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“In banks there is always a bias towards one side of the argument. The business line was more focused on getting a transaction approved than
on identifying the risks in what it was proposing. The risk thinking therefore leaned towards giving the benefit of the doubt to the risk-
takers.”
“Confessions of a Risk Manager”The Economist, August 7, 2008
Analytical Challenges
Compliance Challenges Overspending on redundant, manual
processes Lack of vision around performance
management connected to compliance One-off regulatory compliance projects The burden of compliance will only continue to
increase
Risk
CustomerInsight
Risk Management Challenges No framework for consistent management
and mitigation of risks across enterprise Interrelated risks treated in silos of
information Weak business, physical and IT
standards to support enterprise risk management
Inaccurate and delayed monitoring of key performance and risk indicators
Cust. Insight Challenges No single source of truth for customer data
Incomplete view of customer
Inability to cross-sell intelligently to customer base
No way of tracking or refining campaigns
Compliance
Performance
Performance Challenges Information not timely enough to evaluate
organizational performance
Multiple Versions of the truth
Inconsistent, measures, targets and accountability
Managing returns require risk adjusted insight
• “Get me the data that I need”• Data sits in multiple places• Data is difficult to get at for the business user• Data is not formatted or presented in a way that’s relevant to me
• “Produce the data that I need to help me run my business better”• Data from Operational systems only tell part of the story• Financial services are about analyzing and risk
• “I don’t trust the data I see”• ”My data does not match that of another departments”
• Definitions are not matched, clean or normalized• Data is not reconciled between systems
Problems with Getting Actionable Intelligence
Getting the wrong, too detailed, or insufficiently detailed report
Getting data or facts, not information
Getting information that does not make any sense
Def
init
ion
s m
ism
atch
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cro
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epo
rts
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Roadmap to Management Excellence
The Next Wave: Extend Operational Excellence to Management Excellence
Time
CompetitiveAdvantage
OPERATIONAL EXCELLENCE
MANAGEMENT EXCELLENCE
OLTP & ODSSystems
Data WarehouseData Mart
SAP, Oracle, Siebel,PeopleSoft, JDE, Custom
ExcelXML
BusinessProcess
OLAP
Oracle EPM SystemIndustry’s First Integrated EPM System
Fusion Middleware
Business Intelligence Foundation
EPM Workspace
BI ApplicationsPerformance Management
Applications
Market Leading Applications
BI Applications
EPM Workspace
OLTP & ODSSystems
Data WarehouseData Mart
SAP, Oracle, Siebel,PeopleSoft, Custom
ExcelXML
BusinessProcess
OLAP
Fusion Middleware
Business Intelligence Foundation
Enterprise Performance Management
Enterprise Performance Management
Customer Insight
Customer Insight
Governance Risk & Compliance
Governance Risk & Compliance
Enterprise Risk Management
Enterprise Risk Management
Oracle’s Analytic Applications Vision in Financial Services
1. Merge Best-of-Breed capability across products
2. Create a single integrated platform
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Financial Services Business Intelligence
Financial Services Analytics Framework
Financial Services Data Model
TreasuryServices
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Analytic Applications
Financial Services Business IntelligenceFinancial Services Business Intelligence
Financial Services Analytics FrameworkFinancial Services Analytics Framework
Financial Services Data ModelFinancial Services Data Model
Inte
gra
ted
So
luti
on
Str
uc
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Inte
gra
ted
So
luti
on
Str
uc
tureReports
Alerts
Dashboards
Embedded
Purpose Built Engines
Common Tools
Business Rules
Stochastic Modeling
Common Objects
Common Dimensions
Pre-Integrated and Extensible
High Volume
Integrated Analytic Applications for Financial Services
Enterprise Performance Management
Enterprise Performance Management
Customer Insight
Customer Insight
Governance Risk &
Compliance
Governance Risk &
Compliance
Enterprise Risk Management
Enterprise Risk Management
Analytic Applications
Enterprise Performance Management
Enterprise Performance Management
Customer Insight
Customer Insight
Governance Risk &
Compliance
Governance Risk &
Compliance
Enterprise Risk Management
Enterprise Risk Management
Profitability&
Allocations
Budgeting&
Planning
FundsTransferPricing
AssetLiability Mgmt
CRMAnalytics
Interconnected, Integrated Analytic Capabilities
Credit RiskEC/BASEL
Credit RiskRetail/Corp Market Risk
OperationalRisk &
EC
Compliance& Fraud
Risk Governance
ChannelBehavior
RiskPerformanceCustomer Insight
Business Intelligence Dashboards, Queries, ReportingU
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An
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Ass
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En
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Profitability&
Allocations
Budgeting&
Planning
FundsTransferPricing
AssetLiability Mgmt
CRMAnalytics
Interconnected, Integrated Analytic Capabilities
NII
An
alyt
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Ap
pli
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sCredit RiskEC/BASEL
Credit RiskRetail/Corp Market Risk
OperationalRisk &
EC
Compliance& Fraud
Risk Governance
An
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ChannelBehavior
Transaction Drivers & Costing
Cash Flow & Pillar 2Credit & Behavior ScoresR
AP
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Capital AdequacyMulti-Channel Fraud
Regulations/PoliciesProcesses
Segmentation
RiskPerformanceCustomer Insight
Variance Future Balance Sheet
Treasury NII, Variance & Scenarios
Sec
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C
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Customer Profitability
Business Intelligence Dashboards, Queries, ReportingU
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Oracle Team & Development Method
• Single Division Focused on Analytic Applications for Financial Services
• Significant New Investment in Development Resources• Framework Based Approach to Development• Common Objects Leveraged Across Solutions
• Allows greater speed to market• E.g. Common retail pooling engine stratifies instrument groups
for use in Basel II, ALM, FTP, Economic Capital• E.g. Prepayment assumptions defined in single place and
leveraged across the suite
• Business Logic Embedded in Rules Interface• Users able to modify calculations to fit their business
Platform Value Propositions
Comprehensive Covers absolutely all areas of interest to FSIs
Customer & Employee Centric 360 degree customer information with full employee connections
Best of Breed for FSI Each area is deep and rich, market evidence of cutting
edge capability
Connected & Integrated across Functions
e.g. Profitability and Risk are seamlessly available
together for RAPM
Consistent across the Enterprise Dimensional and other definitions are commonly shared
Pervasive and Actionable across the Business
Easily slides into the business processes thru standard interfaces
Immediate and Timely Manages near real-time data updates
Closed Loop Includes user actions and results in the analysis
Industrial Strength Built on Fusion Architecture
