Achieves £23 Million Cost Savings and Productivity Gains and 260% ROI with Oracle Database, Oracle9i Application Server, and E-Business Suite

Woolwich Independent Financial Advisory Services Achieves £23 Million Cost Savings and Productivity Gains and 260% ROI with Oracle Database, Oracle9i Application Server, and E-Business Suite

The Challenge: Dominating the UK Key Benefits Independent Financial Advisory • Increase in cumulative revenue growth by more than 250% in Services Industry four years, compared to 75% Independent Financial Advisors (IFAs) handle 43 percent of new financial services across its market business in the UK. IFAs were formed in response to a consumer preference for buying • £23 million contributed to profit from advisors not tied to one company’s products. growth—outstripping target by The Woolwich mortgage company founded Woolwich Independent Financial Advisory almost three times over five years Services (WIFAS) in 1989 to compete in the IFA market and provide advice to • 59% of excess profits enabled by Woolwich customers. WIFAS has grown to be the UK’s second largest IFA company Oracle-based sales management with around 400 advisors and 155,000 customers. Its sister company Sedgwick tracking system and e-commerce Independent Financial Consultants is also a top 10 UK IFA. “The Woolwich” is part of applications Barclays, one of the UK’s largest mortgage lenders. • Over £16.3 million net cost WIFAS’s vision was to become the UK’s most successful IFA player. To achieve that savings achieved through goal, it had to transform from a paper-based business, selling face to face and by increased staff productivity telephone, to an automated operation with a clear view of its customer operations, • Customer base increased from offering more product choices and faster delivery. WIFAS committed itself to retaining 52,000 to 155,000 over five years and growing its customer base, optimizing service and delivery, exploiting e-business benefits and hitting consistently high levels of customer satisfaction. • 260% return on investment achieved to date

“We needed a 360-degree view of the customer, our relationship, and a full transaction history, rather than a traditional product-centric partial view of the customer. This would allow us to analyze customer profitability and identify opportunities for maximizing individual customer worth.” Alan Keegan, Commercial Development Director The Answer: Tracking Customer Activity, Moving Online, and Preparing for Industry-Leading CRM

WIFAS recognized that it needed the help of a technology solution provider with Corporate Profile integrated technology that would work together seamlessly. The WIFAS project team Woolwich Independent Financial members were impressed by Oracle’s understanding of its industry and felt Oracle Advisory Services Limited shared WIFAS’s vision. To help team bonding, each WIFAS manager in the project London, UK “buddied up” with an Oracle team member.

wifas.co.uk Together WIFAS and Oracle developed a phased strategy based on automating back office, e-commerce, and CRM processes and delivering revenue and profit growth Woolwich Independent Financial through greater efficiency, cost savings, and improved customer service. Advisory Services (WIFAS) is a wholly-owned subsidiary of WIFAS also designed its strategy to be scalable into Sedgwick and the other Barclays Woolwich plc, one of the UK’s IFA businesses in the future. leading providers of personal Initiated in 1997, the first phase of the strategy focused on a core back office Sales financial services. Woolwich is Management and Referral Tracking (SMART) system based on the Oracle Database owned by Barclays, one of the UK’s and developed with Oracle Consulting. SMART now manages sales activity all the way largest mortgage lenders. through to commission receipt and banking. The automated system has delivered £23 Industry million in productivity improvements and cost savings. The Oracle-based architecture Financial Services and application suite are scalable to manage rapid growth and expansion.

Annual Gross Revenue The second phase in 2000 developed WIFAS’s e-commerce capability. WIFAS and £68 Million Oracle Consulting worked together to establish a technology platform capable of developing an e-business channel linking the IFA businesses to providers and Chief Executive Officer consumers. The initial requirement was to achieve a Web presence and channel Dawn Johnson, allowing the IFA businesses to exploit the new UK Stakeholder Pension offering. Retail Regulated Sales Director Using the portal functionality of Oracle9i Application Server, WIFAS and Oracle Oracle Products and Consulting developed new Web sites for both WIFAS and its sister IFA company, Services Studied Sedgwick. These portals enable consumers to view details of their own portfolios. • Oracle Database Sedgwick can co-brand sites with its corporate clients so that client employees can • Oracle9i Application Server access their pension information online. The portals also allow work-site marketing to • Oracle9iAS Portal promote additional products and services to corporate client employees. • Oracle9iAS Discoverer • Oracle9iAS Warehouse Builder WIFAS’s next steps in its e-commerce strategy will give customers a full online • Oracle eMail Center service. They will be able to value their holdings in real time—an industry-leading • Oracle TeleService advantage in the UK—get quotes for new products, complete applications online, and • Oracle Consulting transfer funds into new or existing products. More product providers will be able to complete their business online (three are online currently), removing paper and manual intervention from quotes and new business processes. Customer satisfaction levels “The relationship with Oracle was critical. should further improve, and WIFAS and Sedgwick will gain from additional online We trusted the company and felt we had a efficiencies and reduced processing costs. Transparency of holdings information should strong psychological contract with the also encourage higher levels of customer investment. organization. Oracle had a good In 2001, the third phase of the project focused on a CRM solution based on understanding of our industry and the Oracle9iAS Portal, and Oracle CRM (TeleService, Foundation, eMail Center and challenges WIFAS faces. They gave us access Intelligence Tools). The solution includes a contact center manned by qualified IFAs. to industry specialists and were able to share Emails from each Web site (WIFAS and Sedgwick) are also managed and directed our strategy and vision for the future.” automatically to the right staff, enabling further efficiency savings. Alan Keegan, Commercial Development Director WIFAS faced a significant CRM challenge in extending access to and improving the quality of customer information. WIFAS had to ensure that all its financial advisers 2 and managers receive a single version of information about customers, products, and “My own experience of Oracle has been the most key business performance indicators on a daily basis. positive experience that I have ever had in systems development - and I have had some. WIFAS turned to Oracle 9iAS Portal, Oracle9iAS Discoverer, and Oracle9i Warehouse They were flexible, patient, straight. The Builder to create intelligent self-service. Oracle’s integrated business intelligence tools relationship worked really well.” extended an intranet portal with Web analytical capabilities that presents a centralized Dawn Johnson, view of heterogeneous data seamlessly integrated in an Oracle Data Mart. Users can Retail Regulated Sales Director now access management information via a Web browser, and the IFA decision makers have a complete view of all customer interactions. Market Cumulative Faced with challenging goals and a variety of governmental regulations that are Revenue Growth changing its industry, WIFAS selected Oracle TeleService, Oracle eMail Center, and % Oracle9i Application Server to lower the cost of sales operations and leverage business 300 opportunities presented by the regulatory changes. Ultimately, the Oracle E-Business 250 200 Suite has allowed WIFAS to increase its ability to up- and cross-sell, identify new 150 customer prospects, and even provide online valuations of insurance products directly 100 to its customers and advisors, significantly enhancing the quality and depth of the 50 customer relationship and experience. 0 19981999 2000 2001 250% Revenue Growth vs. Industry Rate of 75% WIFAS L&P markets WIFAS achieved significantly better revenue growth than its competitors in the life WIFAS revenue growth significantly better than L&P markets and pensions IFA market sector. Over four years, WIFAS grew cumulatively by over Performance in 2000 mirrors poor performance overall 250 percent compared with 75 percent cumulative growth for the market as a whole. Between 1996 and 2001, the customer base grew from 52,000 to 155,000. During the WIFAS Cumulative Profit Growth same period the average number of policies per customer increased by 29 percent for 1997-2001 new customers and 4 percent overall. £m £63.5m Exceeding Growth Target by 150% 70 60 15.9 WIFAS exceeded its growth target between 1997 and 2001 by more than 150 percent 50 6.8 (£39 million). Of this achievement, the company credits £16.3 million to cost savings 40 16.3 and £6.8 million to productivity benefits, both enabled by Oracle. 30 20 24.5 24.5 Cost, Benefit, and Payback 10 Over the last five years, Oracle’s products have helped WIFAS achieve a 260 percent 0 Growth Target Actual return on investment (ROI) for the SMART and E-Commerce projects undertaken so Additional productivity Cost benefits – SMART far. The payback period was 2.5 years. Productivity – SMART Growth target Growth target set at doubling profit four years Improved Staff Productivity and Cost Savings of £16.3 Million Significant profits in excess of growth target achieved – 59% of additional attributed to An important benefit of the WIFAS and Oracle strategy is improved staff productivity. SMART/E-Commerce Because of the quality of information available now online, the staff required to support each customer-facing IFA has decreased significantly: support staff needed for each IFA has decreased by 60 percent over four years—equivalent to £11 million WIFAS Project Financial Returns savings. The number of managers required for each IFA has decreased by 21 percent £m over the same period—equivalent to £7.6 million savings. Meanwhile the number of 30 25 other staff in the rest of the company required to support each IFA has also decreased. 20 Because the staff “on-cost” (non-staff overhead) has remained proportionate to direct 15 staff costs, real estate cost savings are delivered in line with staff cost savings. Staff 10 productivity over four years represents a net saving of £16.3 million. 5 0

Increased Customer Base -5 While WIFAS’s e-commerce strategy is still being implemented, customers are -10 1997 1998 1999 2000 2001 Aug02 benefiting already from the company’s ability to track individual interactions. The NPV = £16m Cost company can pick up the customer trail from the moment the customer is referred to IRR = 285% Benefit ROI = 280%+ Cumulative net benefit WIFAS. As a result, the right financial advisor can quickly be in front of the right Payback period = 2.5years

3 customer. The ability to analyze customer information more efficiently means that “It used to take a manager 1.5 hours to direct marketing campaigns can better match customer needs. prepare for a review with an IFA. Reports are now automated, and it takes less than 30 The proof of improved service is an increase in the customer base from 52,000 to minutes.” 155,000 between 1996 and 2001 and an increase in the number of products sold per Chris Regan, customer—29 percent for new customers and 4 percent overall. Managing Director Financial Management and Control of Risk

A major benefit of the automated back office sales and marketing tracking system is that the WIFAS Finance Department now has insight into every customer transaction. “We now know our customers and how we are Where detail is needed, WIFAS staff can drill down into customer accounts to engaging with them.” individual policies. Oracle’s end-user-focused business intelligence tools enable better Alan Keegan, accuracy in equipping the IFAs to report quickly and accurately to customers. Commercial Development Director As a result, the company is also better run and managed. For example, internal accounting has improved, and commission payments are almost always right the first time. Oracle’s business intelligence tools enable the IFAs to perform a more targeted “We have transparency of the information— analysis of customer data and develop their own reports, sorted and organized according right down to the individual customer. We to specific business requirements. They can now forecast business trends; generate know exactly where the income has come from.” exception, summary, or stratified reports; and produce graphical representations on a Ian Smith, daily basis. WIFAS can have a complete end-to-end view of the business and can Retail Regulated Sales Financial Director understand where leads are coming from. It can also better manage risk.

Company Culture and Market Positioning “We have reduced our costs, have standardized Oracle’s integrated solutions have enabled all staff to do their jobs better, share better processes, have line of sight of everything, and quality information, and respond to customers and colleagues quickly and accurately. clear accountability. We have increased our WIFAS has observed increased staff credibility with providers and customers. income, achieved governance over the business, Customer retention and acquisition performance is strong. Business controls are more and flexibility to react to changing market efficient. Company culture is changing fundamentally, and the company is equipped places.” with the flexibility and scalability to realize its vision to be the number-one IFA in Caroline Chinnock, the UK. Business Development Manager

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