Above: When viewed from the back, the History Wall captures the HSBC corporate signature in embossed form. An original design by Thomas Heatherwick Studio, this contemporary work of art — measuring 34.5 metres long and 6.6 metres high — marks the history, achievements and values of the Group. Its 3,743 images, taken from documents, photographs, portraits and illustrations of staff, buildings, events and businesses, are attached to metal rods and suspended like flags from the glass wall (detail at right). The inset shows preparation and fitting out work in the wall area prior to the installation of the images in early 2002. 10 HSBC HOLDINGS PLC The Implementation of HSBC’s Strategy: a Review by the Group Chief Executive It is always gratifying when the quality of our service or products is recognised in the form of customer commendations in major surveys, or awards from the media and professional organisations. We received a good many in 2002, including The Banker magazine’s top accolade of ‘Global bank of the year’. Others are highlighted in various parts of this review. Personal Financial Services Improving the quality and range of services we provide to our 36 million personal customers worldwide remains a key strategic objective. With this in mind, we concentrated on developing our Personal Financial Services team in 2002. By aligning our 2002 was the fourth year of our current five-year plans and initiatives across all our main Personal strategic plan which focuses on ‘Managing for Value’. Financial Services operations, we have established a In spite of the testing economic conditions in many framework within which we can develop our business of our markets, we have made further solid progress. and become even more customer-driven. In 2002, the Throughout the year, we have continued to place business made a pre-tax profit (on a cash basis) of emphasis on managing across geographical US$3,543 million. boundaries. This involves harnessing the general managerial skills and local experience of our people HSBC Premier, our internationally uniform in different countries around the world with the service for our most valuable personal customers, is a specialised knowledge of those responsible for our good example of our customer-driven approach. In various businesses. We refer to this as ‘collective 2002, the service was launched in a further six management’ and we believe that our success on this countries — China, France, Panama, Taiwan, front gives HSBC significant competitive advantage. Thailand and Turkey — bringing the total to 29, the In simple terms, this is teamwork on an international number of Premier customers to 632,000, and the scale. number of Premier Centres to over 200. This year will see Premier launched in Greece, and Mexico We have also continued to invest heavily in where we now have almost five and a half million ensuring that we remain customer-driven and able to personal customers. On average, Premier customers service customer requirements better by introducing buy 2.5 times more products from us than our other superior systems and training support for our staff. customers. This has included looking at more flexible pricing structures, offering new and innovative products, and In a particularly important and exciting providing our customers with real alternatives to development, International Services from Premier for traditional investments. In fact, a significant internationally mobile customers have been piloted proportion of the more than US$2.5 billion we among Canada, the Hong Kong SAR, Jersey, the invested in technology in 2002 was spent on customer UK and the United States. These services include relationship management systems, on electronic seamless account opening and credit history transfer delivery channels such as the internet and telephone across borders, and will be extended in 2003 to banking, and on the worldwide roll-out of our Brazil, France and India. standard computer systems. Our customer relationship management systems It was a year of major development for our and skills are now used in varying degrees in more electronic banking services, with a stream of than 30 countries. For example, following its success innovations and service enhancements increasing in the UK, our ‘Individual Solutions’ programme satisfaction levels among our customers and was launched in the Hong Kong SAR where 800,000 providing them with greater choice in all our major Individual Solutions were implemented for geographical areas of operation and lines of business. more than 600,000 customers. In 2003, HSBC Bank More details can be found in the following sections. USA will also adopt the customer relationship 11 HSBC HOLDINGS PLC The Implementation of HSBC’s Strategy: a Review by the Group Chief Executive (continued) management systems and processes first developed in HSBC Insurance Agency (USA) Inc. increased HSBC Bank plc. premium volume from US$667 million in 2001 to US$1.4 billion in 2002, mainly from fixed annuity Our customer relationship management initiatives and life insurance sales. Telemarketing of general are being aided by a more standardised approach to insurance products was fully launched in Hang Seng customer segmentation, enabling us to develop Bank, while the joint HSBC Life (International) services linked to customer life stages, cultural Limited and Hang Seng Life Limited operations diversity and gender. For instance, new services became the Hong Kong SAR’s second largest issuers developed for the benefit of children were launched of new insurance to personal customers. in 2002 by Hang Seng Bank Limited and HSBC Bank Australia Limited, while female executives were In Brazil, pensions growth was among the highest the focus of HSBC Bank Middle East’s new Yasmeen in the market, with 36 per cent more participants and services. HSBC Bank USA launched an Islamic- 16 per cent more paid in contributions. In Argentina, compliant home finance package, charge card and we began selling motor and home insurance on the bank account for the Muslim community. internet and, in spite of the economic crisis, HSBC increased its auto scoring portfolio by 30 per cent. The provision of insurance products to personal customers is an increasingly important part of our In the UK, where insurance cross-selling is wealth management strategy. We provide both our benefiting from strong mortgage sales and lending, own and externally sourced life, pensions, HSBC is now the leading provider of individual investment-linked and protection products, as well as income protection, with a market share of 19 per insurance broking and actuarial and consultancy cent. HSBC Bank plc also became the fifth largest services in 35 countries and territories. provider of UK pensions, with a six per cent market share for its award-winning ‘stakeholder’ pension. 12 Main picture: A close-up view of the top floors and the roof of HSBC Group Head Office, looking east and taken from the roof of the tallest building in the UK, at 1 Canada Square. In the panorama behind the building, the runway of London City Airport, which serves mainly business travellers, is visible in the distance on the right, with the Millennium Dome on the far right on the bank of the Thames. Right: The top picture shows a construction worker looking towards the City of London as the HSBC hexagon symbol nears across the world. Rotating these meetings among the final stages of installation in 2001. A giant hexagon symbol different continents provides our senior executives appears on each of the four sides of the building just below the with first-hand experience of what our customers in roof. Powerful back lights illuminate the brand at night. The different countries want — a real example of double-level space below the brand in the main picture is the collective management at work. International Boardroom, shown during fitting out in the middle picture and with the Directors getting ready for the start of their first Board business centres in each country ensure that our meeting to be held in the new building in September 2002. In front-line employees can meet our customers’ cross- addition to providing state-of-the-art audio-visual facilities, the border needs quickly. Boardroom has a map of the world created from two-tone aluminium slats across an entire wall and, from its floor-to- HSBC Premier customers, for example, reaped the ceiling window, a panoramic view across London. benefit of Portfolio Plus, HSBC Republic Investments Limited’s laptop-based discretionary portfolio management service, while our structured It is important, particularly in the current and capital-protected products were extended economic climate, that we continue to innovate and further by our French subsidiary, Sinopia Asset share best practices. We hold quarterly meetings of Management. our top Personal Financial Services managers from 13 HSBC HOLDINGS PLC The Implementation of HSBC’s Strategy: a Review by the Group Chief Executive (continued) We recognised our customers’ desire to invest in acquired ABN AMRO Bank’s retail mortgage more equity products, underpinned by varying portfolio in the country. degrees of protection against loss. Our business in Nothing has had quite the impact on our Personal Hong Kong achieved turnover of HK$28 billion in Financial Services business in recent years as the structured deposits. HSBC in Canada, Singapore and advent of the e-age, where we made quite dramatic Taiwan also launched various structured deposits, progress in 2002. while Hang Seng Bank introduced 30 capital- protected funds. HSBC Bank International Limited Although our e-efforts have focused mainly on in the Channel Islands sold a record US$900 million internet banking, important developments in e-mail of capital secured funds. and mobile phone applications are now also paying dividends, and all our major business lines are In another important area — cards — we showing strong e-channel growth.