Minsk 2016

Development and implementation of MBO and KPI systems in a bank

We create key decisions and key events in partnership with our customers.

Purpose of KPI system

Decomposition of strategic and tactic goals to the level of responsibility of individual managers and staff.

* KPI (Key Performance Indicator) –is a type of performance measurement which evaluates the success of an organization or of a particular activity.

Operative monitoring of the productivity and efficiency of the bank.

The system of material stimulation and non-financial motivation, based on a culture of aim achievement.

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The composition of the KPI system

• KPI methodology• Tree of objectives for the bank• Position profiles• KPI information system :o Data acquisition and processing

subsystemo Performance indicators calculation

subsystemo Compensation calculation

subsystemo KPI analysis and monitoring

subsystem

• System roles:o Methodologisto Managero Usero Administrator

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The composition of the KPI methodology

• Regulations on material incentives• Regulation on KPI reporting• Positions profiles• Indicators library• Templates of indicators calculation formulas

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Example. Tree of objectives (fragment)

The sum of attracted deposits

The amount of attracted

deposits

The quality of the

portfolio

Number of attracted

clients

The sum of concluded contracts

Average daily balances on

deposits

The dynamics of credit assets

The quality of SME assets

Interest and fee income of small

and medium business

Interest and fee income of big

business

The financial result of

corporate business

…

…

…

The bank's profit

The financial result of the

retail business

Bankexecutiveslevel

Businessunitslevel

Departmentlevel

Localofficelevel

Specialistlevel

Example of position’s profile(client manager, services for corporate segment)

The group of competences

Competence Indicator Level

Knowledge

Information Security

Observance of banking and trade secrets

2Observance of confidentiality

Observance of information security

Bill of exchange and certificate of deposit

Options

1Target audience

Functionality

Credit technologyThe application process

3Determination of GSL

Skills and abilities

Conducting correspondence

Ability to build suggestions1

Using the rules of business correspondence and writing etiquette

Using IAMS Skills in the use of IAMS 2

Corporate competence

Focusing on the external client

Presentability, the ability to attract people2

Clarification of customer needs and opportunities

Formal requirements

Education Any field of educationCollegedegree

Experience Experience in the banking sector 7

Information KPI system

Questionnaires

Data WarehousePOS

CRM

Accounting systems

Employees and managers

Data acquisition and processing

subsystem

Performance calculation subsystem

Compensation calculation subsystem

Analysis and KPIs monitoring

subsystem

KPI Methodologist

Platforms for automation

Depending on the bank's IT-landscape and objectives of the project, we propose to consider the options for

KPI system automation platforms:

In collaboration with IBA Group,

Belarus

In collaboration with Kertios Consulting,

Russia

In collaboration with KPI Lab,

Russia 9

Our offer

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Integrated project of implementation and automation for KPI system

Development of methodology and position profiles

Trial measurements

and adjustment of the system

AutomationDesign of KPI system to be automated

Phase I Phase II Phase III

It's possible to separate projects of development and system automation or make individual project of setting

KPI system without automation

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Development of methodology and positions’ profiles

The first phase of the project includes the development of:

• Concept of KPIs’ management system.

• Tree of objectives and Balanced Scorecard (BSC).

• Regulation of monetary incentives for employees.

• Position profiles for managers and specialists (sets of indicators for each position covered by the system).

• Specifications of indicators (calculation formulas, sources and methods of obtaining information, the periodicity of the revision, the targets and limit values for related indicators).

• Individual C&B agreement with the employee.

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Trial measurements and adjustment of the system

Initially, the system is not automated. The system is being tested by the available means of information exchange and processes automation.

The goals to achieve during the system testing:

• Determine the system spread sequence

• Getting the KPIs’ trial measurements

• Correcting individual positions profiles to optimize system’s performance

• Creating the task list for the system automation13

Designing of automated KPI system

• Collecting, analyzing and recording business requirements

• Designing the system architecture based on the IT infrastructure and prospects of development of the system

• The development of technical specifications for automation

• Recommendations regarding the choice of automation platform and vendor for implementation

Technical task

• List of terms and abbreviations

• Purpose and objectives of the creation of an information system for KPIs management

• The business requirements for KPI management system

– Functional requirements for KPI management system:

– The structure of the subsystems

– Means and methods of information interchange between subsystems

– Integration with external systems

– Scaling features

– Personnel qualification requirements

– Requirements for system reliability and diagnostics

– Security and data protection requirements

– Requirements for the user interface

– Terms of use

– Functional requirements for the subsystems:

• Storage subsystem

• NSI management subsystem

• KPI calculation subsystem

• Subsystem of calculation of the variable part of salary

• Performance management subsystem

• The monitoring subsystem, performance analysis and reporting

• Subsystem data export

• Requirements for technical support

• Requirements for acceptance testing

• Documentation petition

AutomationWe provide support for the full cycle of an automation project:• Collecting of business

requirements• Project scope

confirmation• Schedule monitoring and

confirmation of the "control points“

• Matching of acceptance tests techniques and test cases

It is possible to bind our remuneration to the project's success indicators (including compliance with the schedule and budget of the project)

Vendor

BankSpe-

cifica-tion

Imple-mentation

Methodology

Project management

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Project team

Andrey GusakovskyManaging partner and founder of

the company "Key decisions". Certified Management Consultant

(CMC) in accordance to International Council of Management Consulting

Institutes (ICMCI).

Serge MustafaevProject manager in projects of human

resource management systems installation, diagnostic of sales,

personnel assessment, changes in the organizational culture of the company, audit and optimize the functional and

organizational structure. Extensive experience in the development and

implementation of incentive systems based on KPI, MBO and BSC.

Victor StepanovHead of IT practice.

Management consultant, economist, expert in the field

of project approach and management automation.

Extensive experience in the field of management

accounting systems, project management, KPI, ERP, CRM,

PLM, BPMS.16

Next steps

This presentation represents a variant of system approach to the implementation of management by objectives and KPI in the bank.

Offer for your bank must be based on your business need, the features of the corporate culture and IT infrastructure.

Looking forward to meet you for presentation of our comprehensive services, to know out about your needs and then to prepare a proposal.

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>350consulting projects implemented forBelarusian, Russian and Ukrainian companies

>200 author’s seminars and trainings >100 exclusive business

events

Our company

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Company structure

Consulting department

Department of Business Events

Business Training Department

Recruiting Department

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Key decision - is a combination of our experience and understanding of the uniqueness of each business.

- it is more than 20 years of experience in management consulting

- it is more than 12 800 trained staff

- it is more than 100 stars and business gurus from around the world

- 7 types of services is the company's staffing

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Our customers

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г. Минск, пер. Загородный 4-й, д. 58-Б офис 319

kr@krconsult.org

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