Citibank’s e-Business Strategy for Global Banking

Said Altınışık Moustafa Abdulaziz

Asuman Çakıroğlu Özgür Öztürk

 

Citibank’s Global Cash and Trade Division
Manage the flow of money for its corporate customers Provide tools and channels to receive money and to make payment efficiently Enable its customers to conduct transactions online

Citibank’s Global Cash and Trade Division
The Goal Build a single web-enabled platform for all customers with similar service needs, develop integrated solutions, and reach new markets

A.000 .Over 100 Customers .268.000 Countries . 2001: Staff .Global Corporate Banking at Citibank 1812: Founded as City Bank of New York 1976: named as Citibank N. 1998: changed to Citigroup Inc.192.000.

Global Corporate Banking at Citibank Core Products Transaction services: cash management. trade and custody services Corporate finance services: working capital finance. assetbased financing Treasury market services: hedging and foreign exchange . trade finance.

financial institutions. local corporations SME businesses Daily financial transactions $1 trillion worth .Citibank’s Cash Management and Trade Clients Services Multinationals. government sectors.

Citibank’s Cash Management and Trade Citibank understood that all banks offer Services similar services. o thus they differentiated themselves through o  Offering telephone hotlines  Relationship managers who understood clients’ needs  Product consultants who provide service expertise  Continous investment in technology .

Cash and Treasury Management Products Focus on finding ways to move money around in the most efficient manner Focused on developing solutions to address Accounts receivable process management Accounts payable process management Liquidity management .

.Trade Products Offered Trade finance Trade services Trade support services Product offering covered banking services and financing needs of customers who had import and export trade transactions.

Citibank emphasized on customer services(response time.In pricing policy. technology. support) Pricing And Customer Services By offering outsourcing Citibank Secured all the businesses from the customer Gained a total relationship with the customer Obtained economies of scale with a large number of customers .

internet banking capabilities Banks needed to identify what clients look for and keep up with the ones they supposed to develop “consultative” relationships .A Changing Global Environment/ Customers Sophisticated corporate customersadditional services(collect payment online. access to efficient web-enabled financial processes etc.) Middle markets.

B2B Market in 2000 Sophisticated clients were looking for ways to improve their traditional payment processes. Electronic invoicing Automatic application of payments to accounts receivable Online payment guarantees Multicurrency payment management Payment aggregation by invoice and currency .

Payment Methods Cheque–Most of B2B payments Notes and coins– Banker’s draft–Payment is guaranteed. Credit cards– Special presentation of cheques–Only in cases of extreme doubt about customer Transfers–from a bank account to another .

.Competition New technology required major investment in people. Deutsche Bank and Citibank were two leaders and ABN AMRO was also developing its product range. risk and technological services and few banks were competing at the global transactions services marketplace.

Empower local. .Citibank e-Business Strategy Vision – Become the world’s leading ebusiness enabler Aims : 1. regional and global customers 2.help them take advantage of the efficiencies and opportunities created by ecommerce.

Citibank’s e-Business Strategy connect transform extend .

C W H B E r e u m U e b l s a p d e t e d e n c a a u C k b s n n e t e o t m w b c e o a e o r n d r t k g e o a e f s s t b e t h a r e Six Key Elements ofCitibank e-Business Strategy .

Citibank’s e-Business Structure In March 2000 – Formated Internet Operation Group responsible for Internet activities between e-Citi and the bank’s business unit. In April 2000 – e-consumer and ebusiness units In May 2000 – e-capital markets and easset management units .

Citibank decided to form alliances in 2000 .Citibank’s Alliance Strategy Citibank tried to excel all facets of e-business but failed to do so. Clients and technology were constantly changing and it was hard to keep up to clients’ needs.

com ● Oracle ● Commerce One Inc.net .Citibank’s Alliance Strategy Key technology players to form FinancialSettlement Matrix. ● SAP AG ● Wisdom Technologies ● Bolero.

 .com A Company to connect buyers and sellers in emarketplaces while performing activities such as: Payment Processing  Credit Services  Other services   through multiple participating banks and  financial institutions.FinancialSettlement Matrix.

Connect Customer convenience is important for Citibank Provide clients with various options to access Citibank Internet provides the flexibility to meet this demand .

CitiDirect Designed for corporate customers Customers can perform various transactions on-line Transactions take place in real-time In 8 months. 1000 customers were using it .

Transform Back office activities(loan prcess. cash mgmt) Not at the forefront of a customer’s mind Traditionally was a function of bank-customer relationship Citibank realized that. . should be commoditized. required more that 200 data centers. this function.

the number of data centers were decreased to 60 .Regionalisation for Transformation Process involves consolidating all data centers and merging them in Singapore Data is centralized In May 99.

and build it up to replace all the smaller centers Greenfield approach (ask where to get the best balance of all factors of production and start from scratch) Available people and skills Pure cost of labor (especially for lower-skilled areas) .Regionalisation Approaches Considered Take the biggest infrastructure already existing.

Benefits of Regionalisation Provided continual improvement opportunities Reduced the time cycle for transactions Minimized error rates to near zero Yielded new efficiencies for Citibank and customers .

g. no documents checked Centralization made it easier to access data through various security systems: e.Internalizing the Web Transformation focused on “Workflow automation” Employees could access to information in a much easy and reliable way: no phone calls. signature verification .

Straight-through Automation: by… Continuous improvement Artificial intelligence projects to reduce error rates Real-time. on-line transactions created a certainty for customers .

timeliness. accessibility and responsiveness Processing became one of Citibank’s unique selling propositions .Achievements First in the financial services industry to receive a quality award Customer surveys favored Citibank in areas of accuracy.

Extend Building a new global infrastructure gave Citibank the opportunity to:  Deliver e-products more quickly and more efficiently  Ability to install capability improvements from one regional area to world-wide .

Extend Priority was to move all corporate customers to CitiDirect The greatest concern of most customers was security In 2001 Citibank understood that it must provide old methods too for conservative SMEs and on-line services for MNCs .

Pay importance in emerging markets which consists of 86% of world’s population and 43% of world’s purchasing power Strong Brand Innovative.The Citibank Advantage Global Reach 268.000 employees in 100 countries. global bank offering excellent customer service Continuous Investment in Technology Heavy investment of technology Provide customers most cost-effective. cuttingedge. reliable and secure solutions .

Conclusion The Internet changed how institutions made strategic decisions. Customer expectations and needs were increased. Citibank responded by: Web enabling access points to allow customers connect to Citibank Building a new global infrastructure to deliver products and services on-line Integrating products in new ways .

THE END Thanks for your patience. .

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