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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...
Garantis Change Journey Road Map
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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...
Garantis Change Journey Road Map
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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