Royal BankFinancial Group

e-Business Vision& Strategies

Industry Positioning

RBFG eBusiness

• Royal Bank judged Internet Bank 2000 World's top-ranked bank for e-finance Lafferty Research UK, December 1999

• SFNB rated #1 Internet bank for 7 Consecutive quartersBoston-based Gomez Consultants, August 2000

• royalbank.com rated the most popular Financial Services web site destination for Canadians Media Metrix Canada, September 2000

• The bank has demonstrated innovative thinking towards the internet and other changes in technologyMorgan Stanley, December 1999

Strategic Issues

RBFG eBusiness

CustomerConnecti

vity(B2B & B2C)

CustomerConnecti

vity(B2B & B2C)

Informed

Consumer

Informed

Consumer

Disaggregation

Of Value Proposition

(Products separate

from services)

Disaggregation

Of Value Proposition

(Products separate

from services)

Unbundling

of theValue Chain

Unbundling

of theValue Chain

GlobalCompetiti

on

GlobalCompetiti

on

Challenge:Competitive standard for products, services & relationships is raisedCustomer views self as being in chargeCustomer has easy access to tools & information to create own solution

Challenge:Competitive standard for products, services & relationships is raisedCustomer views self as being in chargeCustomer has easy access to tools & information to create own solution

Challenge:Marketplaces are being reshapedBandwidth becoming free and unlimitedUbiquitous access - anywhere, any time, multiple personal devices

Challenge:Marketplaces are being reshapedBandwidth becoming free and unlimitedUbiquitous access - anywhere, any time, multiple personal devices

Challenge:Financial products and previously bundled financial services are being priced separately

Challenge:Financial products and previously bundled financial services are being priced separately

Challenge:Foreign FIs entering home turfFinancial services deregulation

Challenge:Foreign FIs entering home turfFinancial services deregulation

Challenge:Nimble attackers focus on specific pieces of the value chainCreates margin pressure

Challenge:Nimble attackers focus on specific pieces of the value chainCreates margin pressure

Strategic Framework

RBFG eBusiness

Success Measures

Initiatives

Strategies

Vision

• One vision

• Aligned strategies

• Verifiable Measures

• Initiatives

RBFG eBusiness

E-enable each customer’s quest for financial success:

Vision

We build global eBusiness products and services, and trusted relationships that continually draw customers to RBFG.

• Build essential relationships with customers and partners

• Create and distribute selected world class eBusiness products and services

• Continually improve organizational cost efficiencies through the deployment of eBusiness technologies

• Take a leadership role in creating new businesses

Strategies

RBFG eBusiness

Aligned Strategies

• being easy to do business with,

• being attractive to partner with,

• personalizing solutions, and

• integrating into their life-experience or business workflow.

Relationships

Strategies

Build essential relationships with customers and partners by:

Relationships

Strategies

SeamlessCustomerExperience…..?

8

• establishing a customer centric eBusiness product development discipline• take a portfolio approach to eBusiness

product development• cross-functional/cross-platform team• real-time development, market testing

and launch

• entering selected new markets to reach high-value segments

• partnering for scope, reach, speed, shared risk

Products & Services

Strategies

Create and distribute selectedworld-class eBusiness products and services by:

Products & Services

Strategies

World ClassProducts…..

“THERE’S NOTHING WRONG WITH OURPERSONAL FINANCE SOFTWARE, WEJUST DON’T HAVE ANY CUSTOMERS.”

• fully leveraging web technologies

• enabling complete customer self-service

• providing straight-through transaction processing to back-end systems

Reduce Base Costs

Strategies

Continually improveorganizational cost efficienciesthrough the deployment ofeBusiness technologies by:

Reduce Base Costs

Strategies

Business Unit BBusiness Unit A External Partner

It’s about breaking down internal walls: integrating and redesigning enterprise processes to gain efficiencies.

Then it’s about breaking down external walls: integrating and redesigning inter-enterprise processes using the Internet

1999 © The Concours Group.RBC051000

• investing in opportunities aligned with RBFG strategic intent

• capitalizing on disruptive opportunities that have potential for high impact

• being fast into market

Innovation

Strategies

Take a leadership role in creating new eBusinesses by:

Innovation

Strategies

CreatingneweBusinessesalignedwithstrategicintent…….

Aligning Initiatives To eBusiness Strategies

RBFG eBusiness

Strategy Initiative

Relationships

Products &Services

Reduce BaseCost

Innovation

Self-enrollment for on-line banking

Online cheque ordering

Directional Analysis of Current Initiatives

RBFG eBusiness

Strategy 1 Strategy 2 Strategy 3 Strategy 4Trends/Challenges Relationships Products and

ServicesReduce Base

CostsInnovation

Informed Customer

Customer Connectivity(B2C)

Customer Connectivity(B2B)

Disaggregation of ValueProposition (Productsseparate from services)

Unbundling of the ValueChain (margin pressures)

Global Competition

High initiative alignmentMedium initiative alignmentLittle initiative alignment

Key:

RBFG eBusinessB2B Online Marketplace Strategy

V- Market

FinancialServices

E-Procure

FreightFwdr

Insurance

WebHosting

RBFG Financial Services

Internal E-Procurement

Spend Aggregator

Horizontal Marketplaces

Vertical Marketplaces

OnlineBusiness

Centre

Agriculture Hotels RealEstate

IntranetAriba

Indirect

Capital

CustomsLogistics

Accting HR

Trade/FXL/CsL/GsFX

PaymentWireACH

Tax Filing

BankingBalancesTransfersReports

Risk MgtCredit

ScoringD&B

A/R MgtLock BoxBills pdBill Pres.Inv Pres.