First Vietnamese bank honored by TDWI

I am currently serving as BI Director in VPBank and also part of bank’s Board of Management. In terms of my role, I am responsible for realizing bank’s vision of transforming itself into an information driven bank. In early 2014, I set up the BI Competency Center (BICC) reporting directly to the CEO, Mr. Nguyen Duc Vinh. Starting with less than 10, the center now employs 40 people working in different areas supporting information needs of business and support units of the bank. BICC has got four BI departments and one Data Management & Governance department. My current focus is on how to utilize next-generation data management and analytics platforms for monetizing our data assets.

What is the importance of data management for organizations?

No one can deny that data is absolutely essential for better decision making. In fact, most of the organizations now have begun to treat data as their strategic asset. At the same time, advancements in IT and ubiquity of online platforms have led to mind-boggling growth in volume, velocity and variety of data that can be captured. Machine-generated data is expected to grow by 15 times in 2020 according to IDC. Such is the growth in volume of data that instead of usual megabytes & gigabytes, organizations now talk about terabytes & petabytes of data. There also has been a tremendous increase in the speed at which data is generated e.g. data from sensor feeds, social media, traffic feeds, financial transactions etc. Majority of the data has little or no structure or a structure that changes too frequently for any reliable schema at the time of ingest.

But with all the growth, the challenge that remains is what to do with this data and how to convert it into meaningful and actionable information. In order to derive maximum value out of data, it needs to be managed well. Hence the need for Enterprise Data Management (EDM) systems arises. EDM approach is not just limited to utilization of technology; it is an optimum combination of technology, governance and people.

What is the impact of having a data management system in a bank on its customers? Could you give an example right at VPBank?

Most of the banks use multiple IT systems for different business processes because of which customer data is in silos. A strong data management system provides a single view of the customer which helps banks to understand customers better and create segments. Once we have customer segments, it is possible to move away from a one-size-fits-all approach towards an approach in which there are specific programs tailored for each segment. At VPBank, we are looking to farm our existing customers (especially retail customers) better by selling more and more products to the same customer. We have launched 2 initiatives in order to achieve this – customer 360^o tool and cross sell modelling. Through our customer 360^o tool which is very comprehensive and looks at a customer from different dimensions, sales people especially Personal Bankers (PBs) can have a better understanding of them and they know which customers to target for farming. Additionally, we are now building analytical models for cross sell. With the help of these models, built using the most advanced tools like IBM SPSS, R etc., we can know which customers will respond better to our sales offers. These initiatives help us to engage with customers according to their needs and at the same time we achieve a better utilization of our limited resources.

VPBank’s Business Intelligence Competency Center (BICC) is one of the first such centers in the banking system in Vietnam. Please share with us the idea behind setting up BICC. Also let us know the difficulties faced while building this center and its benefits for your bank?

VPBank is on an aggressive growth trajectory. The management realized that in order to achieve its ambitious 5 year goal - one of the top 3 banks in Vietnam (by retail business) & top 5 (overall), the bank has to transform itself. One of the pillars of this transformation was building a world class data management & BI capability ultimately leading to information driven culture in the bank. Data Committee, constituted & chaired by our CEO, was immediately entrusted with the task of overseeing all bank-wide data related initiatives. In order to implement CEO’s vision & also meet fast evolving business needs, Data Committee approved the creation of BI Competency Center (BICC) with the objective to promote and enable effective use of a shared BI service in the bank along with developing & managing a sound Data Governance mechanism.

There were definitely challenges e.g. convincing the bank’s Board of Directors about the value of BICC, finding the right people & technology, increasing the awareness amongst end users of information, coordination with IT etc. To overcome these challenges, BICC was conceived and implemented as an organizational change rather than a technology initiative and best practices like top down approach, phased roadmap, right positioning & communication, balanced mix of people, measurable success metrics etc. were leveraged to ensure success.

Since establishment, BICC has taken remarkable strides forward. For the first time in VPBank, information on critical areas like pre-sales/sales productivity, application funnel, operational effectiveness, loan attrition, campaign effectiveness, product quality, risk indicators, customer cross-selling etc. was available for senior management & day to day business users. Through the financial impact from this information, BICC was able to generate a first year ROI of 227%. Most importantly, BICC was instrumental in putting BI into business executives’ agenda. Ranked no. 1 in the bank for internal customer service excellence, BICC featured in the top 10 achievements of VPBank in 2014 Annual Report. With a 3 year development roadmap, BICC will strive to go further along its maturity curve and bring substantial value to VPBank.

Could you please share with us your further plans in VPBank?

BICC has been successful in more traditional forms of BI e.g. reports, dashboards, scorecards etc. but we still have a long way to go in terms of utilizing and ultimately monetizing Big Data. At the same time, we are looking at next-generation data management platforms like Hadoop in order to capture & act on more and more unstructured forms of data. Governance around data is also a challenge. In fact, VPBank was one of the first banks to have started the implementation of a Data Governance mechanism in 2014 focusing on areas like data ownership, data quality, data security etc. The initial implementation phase has yielded some impressive results especially data quality improvement but it will take time before governance becomes fully operationalized and integrated within bank’s processes.

Nowadays, data management is a global trend. What is your opinion about the market in Vietnam?

As I explained before, organizations across the world have realized that they need to manage the data well in order to derive any tangible benefits. I would say the trend is the same in Vietnam as well. Most of the organizations in sectors such as banking, telecoms, airlines, retail etc. are focusing on data management and BI initiatives, usually with the help from international consultants or partners. The market is taking off although there is a dearth of homegrown players. But devil is in getting the details right and focused execution. The key to success in these initiatives is developing people and sound governance processes over and above technology. At the end of the day, transforming data into information is as much an art as it is science. Making it happen needs the right mindset and implementation approach which can be different for different organizations.

VPBank has just received an international award from The Data Warehousing Institute (TDWI) in the “Enterprise Data Management Strategies” category. Could you share with us some details about TDWI and the judging criteria for this award?

For 20 years, TDWI, based in the USA, has provided inpiduals and teams with a comprehensive portfolio of business and technical education and research about all things data. The in-depth, best-practices-based knowledge TDWI offers can be quickly applied to develop world-class talent across your organization’s business and IT functions to enhance analytical, data-driven decision making and performance. TDWI advances the art and science of realizing business value from data by providing an objective forum where industry experts, solution providers, and practitioners can explore and enhance data competencies, practices, and technologies. TDWI presents five major conferences as well as topical seminars, onsite education, membership, certification, live Webinars, resourceful publications, industry news, and in-depth research.

TDWI's Best Practices Awards are designed to identify and honor companies that have demonstrated excellence in developing, deploying, and maintaining BI, data warehousing, and analytics applications. Companies from perse industries and sponsoring solution providers submitted entries that were judged in a variety of categories. The nominated solutions were evaluated on business impact, maturity, innovation, and relevance by independent judges.

It’s an honor for VPBank to be recognized by TDWI which is an authority on all things data. The best practice award endorses our CEO’s vision of transforming VPBank into a data-driven bank and provides further impetus to our implementation efforts. Looking at the previous winners of these awards namely; HSBC, GE Consumer Finance, Royal Bank of Canada, Scotiabank, IBM, SAP etc. and considering the fact that VPBank is the first winner of TDWI award from Vietnam, makes this recognition all the more special.