Banking on Capture: S O L I D P O S S I B I L I T I E S. e x p e r i e n c e d

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1 t r a n s f o r m i n g P O S S I B I L I T I E S S O L I D T E C H N O L O G Y D R I V E N e x p e r i e n c e d Banking on Capture: Transforming Enterprise Content Management through Intelligent Distributed Capture 1 P R O P R I E T A R Y A N D C O N F I D E N T I A L

2 Overview ECM begins with Capture When and how you digitize content matters First point of touch Retained transactional intelligence Automated recognition and validation Focus on ease of use, security, and compliance Branch banking use cases can teach us important lessons about the art of the possible Explore how more effective distributed capture practices could transform your ECM ecosystem 2 P R O P R I E T A R Y A N D C O N F I D E N T I A L

3 Banks as a Proving Ground Imagine Solutions is seeing broad financial industry interest in paperless branch initiatives Better Tools Distributed capture that can scale, is simple, and is secure Advances in recognition and autoclassification Seamless integration into core systems Re-Imagining the Branch On-ramp to digital customer experience Automation: Paper stops, vs. starts, here Extending the branch to customers homes and mobile devices 3 P R O P R I E T A R Y A N D C O N F I D E N T I A L

4 Distributed Capture Multiplier Effect 100% 80% 60% 40% 20% 0% Customer Value Proposition Central Capture to Archive Central Intelligent Capture Distributed Capture Business Acceleration Transportation Keystroke Savings w/ Dist Capt Vol Keystroke Savings Archive/Retrieve w/ Dist Capt Vol Archive/Retrieval Enterprise Distributed Capture can generate a 3x multiplier vs. central capture implementations* increased capture volume transportation elimination accelerated business processes 4 P R O P R I E T A R Y A N D C O N F I D E N T I A L * Based on actual Imagine Solutions client case studies

5 Courier Elimination: A Compelling Financial Case New Business Case Dynamic This is a big number Without checks, the game changes Branch capture is more compelling The requirement for check transportation has historically eliminated transportation savings from the distributed document capture business case Couriers are now in the crosshairs for expense take-out Assume $40/pickup cost per branch Banks traditionally averaged 3 pickups/day for checks 90,000 U.S. branches x $40 x 3 x 250 days/yr = $2.7 billion Following branch check capture elimination, banks typically reduce to 1 courier run/day for documents (i.e., $1 billion per year) This translates to a cost basis of $10,000/yr per branch $5,000 investment per branch in hardware, software, services can realize a 6 month payback through transportation savings alone Benefits in operational quality, compliance, customer experience 5 P R O P R I E T A R Y A N D C O N F I D E N T I A L

6 So Why Isn t Distributed Capture the Rule? Perceptions about the acceptablity for audit Concerns about image quality or data inaccuracies Diffculty of training users across departments/branches Reliability of automated decision-making Existing solutions are "good enough" Investment costs of scanners and software Perceptions about legal admissibility of electronic Logistics issues of where and who will capture Still thought of as scan-to-archive not scan-to-process Justifying the invesment demonstrating ROI Resistance to change 0% 20% 40% 60% Source: Document Scanning and Capture: Local, Central, Outsource AIIM Survey P R O P R I E T A R Y A N D C O N F I D E N T I A L

7 But, Businesses Understand Its Value More options for relocation, outsource, etc. (organizational flexibility) Improve resiliience to incidents (business conitnuity) Reduce usage of paper and copying (environmental) Reduce physical storage space (office costs) Improve speed of access (customer service) Improve process thoughput (productivity) Records security and accessibility (compliance) Improve searchability of business documents 0% 10% 20% 30% 40% 50% 60% 70% Source: The Paper Free Office dream or reality? AIIM Survey P R O P R I E T A R Y A N D C O N F I D E N T I A L

8 Game Changing Tools Make It Feasible Imagine Solutions Encapture IBM Datacap Digitize and Capture Content Sooner Understand and Classify Content Better 8 P R O P R I E T A R Y A N D C O N F I D E N T I A L

9 Imagine Solutions Encapture The enterprise content on ramp Encapture IBM Datacap/Advanced Capture Solution FileNet/Other Repository/BPM System 9 P R O P R I E T A R Y A N D C O N F I D E N T I A L

10 IBM Datacap With IBM Datacap advanced document recognition, significant efficiencies can be attained Classification Eliminate Document prep tasks Manual indexing Barcode generation Indexing by branch personnel Extraction Eliminate Manual indexing Index verification Downstream data entry Validation Eliminate Manual signature validation Manual document completeness/ correctness validation 10 P R O P R I E T A R Y A N D C O N F I D E N T I A L

11 t r a n s f o r m i n g P O S S I B I L I T I E S S O L I D T E C H N O L O G Y D R I V E N e x p e r i e n c e d Customer Use Cases 11 P R O P R I E T A R Y A N D C O N F I D E N T I A L

12 Solution Proof Points 1. Stop the couriers. 2. Reach out creatively to customers. 3. Integrate capture into core business processes. 4. Learn more, sooner, about your content. 5. Correct errors where they happen. 6. Enlist the energy of your knowledge workers. 12 P R O P R I E T A R Y A N D C O N F I D E N T I A L

13 Stop the couriers. Is this part of your operational workflow? 13 P R O P R I E T A R Y A N D C O N F I D E N T I A L

14 Solution Proof Point: Stop the couriers. The Situation Bank with 700+ branch locations in 21 states $4MM in annual ground and air courier costs (36,000 miles/day) Desire to set stage for comprehensive image workflow The Decision Executive mandate to stop courier fees Deploy distributed and advanced capture to the branches Solution must be as simple as a fax machine The Solution Analyzed shipped content: 120 document types = 90% of volume Created rules for auto-classification of documents Branch staff place unsorted documents in MFD for capture and hit the green button Images sorted and routed to 5 lines of business Eliminated $3MM expense run-rate within 6 months of implementation Complete chain-of-custody audit trail Accelerated customer transactions Minimal staff training requirements High employee satisfaction 14 P R O P R I E T A R Y A N D C O N F I D E N T I A L

15 Reach out creatively to customers. Your customers don t like inefficient processes anymore than you do. Its messy. For some reason it's very messy. The servicers are very disorganized, said Pat Pinto, an attorney with the Orange County Legal Aid Society who helps homeowners in trouble deal with banks. "There have been occasions we have submitted five or six times the same documents to the same servicer who repeatedly tells us we didn t get them. " "Now we have the fax sheet, the confirmation sheet that the lender received it. But the lender tells us I m sorry we didn t receive it. I don t know what their fax room looks like. I can only tell you they repeatedly lose my documents," Pinto said. (Excerpted from 7/22/2010 National Public Radio report) 15 P R O P R I E T A R Y A N D C O N F I D E N T I A L

16 Solution Proof Point: Reach out creatively to customers. The Situation The Solution Major bank in federal home loan modification program (HAMP) 60% of applications abandoned due to incomplete documentation Bank under significant pressure to improve results The Decision Make it easier for applicants to run the paper gauntlet Take counselors to where customers are: community centers, schools, etc. Do it quickly while complying with data security requirements Remote Distributed Capture deployed within 60 days of go decision Security configured to allow capture of sensitive customer data outside the bank firewall Missing documentation identified at the point of customer interaction Imaged application files routed to IBM FileNet repository where they were immediately available for review Significant improvement in HAMP application rates and cycle times Immediate reputational benefit among customer, media, and government stakeholders 16 P R O P R I E T A R Y A N D C O N F I D E N T I A L

17 Integrate capture into core business processes. Let your application systems request the content they need. And then preserve the indexing information they provide. 17 P R O P R I E T A R Y A N D C O N F I D E N T I A L

18 Solution Proof Point: Integrate Capture into core business processes. The Situation The Solution Major Canadian bank with SAPbased mortgage platform Goal to enhance customer experience and reduce cost Program to originate loans in customer homes The Decision Make it easier for applicants to run the paper gauntlet Take counselors to where customers are: community centers, schools, etc. Do it quickly while complying with data security requirements Distributed Capture integrated into SAP loan origination platform Loan officers take laptops and portable scanners into customer homes Specific documents requested from SAP via Encapture Wizard based on that customer s application profile Captured images validated via Datacap Images migrated to FileNet P8 via IBM Content Connector for SAP Immediate enhancement to customer experience Reductions to incomplete or erroneous application files 18 P R O P R I E T A R Y A N D C O N F I D E N T I A L

19 Learn more, sooner, about your content. Distributed capture enables earlier awareness of critical business content. 19 P R O P R I E T A R Y A N D C O N F I D E N T I A L

20 Solution Proof Point: Learn more, sooner, about your content. The Situation The Solution Bank with 1,200 branches using 3 rd party provider for physical pickup, capture, and indexing of loan docs Expensive Error prone Slow The Decision Set up POC around small business loans to prove: Distributed capture technology Auto classification technology Staff usability Build business case for full branch capture initiative Encapture deployed for MFP and desktop scanner use cases Datacap deployed to perform auto classification and selected data extraction for 12 document types POC demonstrated 93% accuracy in automated classification of bank loan documents Accelerated availability of loan documents for review and approval Elimination of requirement for transportation and manual indexing High usability survey scores from branch staff 20 P R O P R I E T A R Y A N D C O N F I D E N T I A L

21 Correct errors where they happen. Validate customerprovided content with conversational response time. 21 P R O P R I E T A R Y A N D C O N F I D E N T I A L

22 Solution Proof Point: Correct errors where they happen. The Situation Bank with 115 branches concerned with 4% account opening error rate Wanted to avoid calling customer back to branch Errors generally caught in manual, back office review next day The Decision Remove dependency on shipping new account form to back office Automate validation of new account form completeness Catch errors and correct before the customer leaves the branch The Solution Integrate capture into teller platform to identify required new account docs Capture signature cards and customer supplied docs through Encapture client on branch MFD Route to images and required signature fields to Datacap Use Datacap to verify that required signatures are present If not, immediately generate with new doc request to branch officer Use Datacap to automatically extract signature snippets and send to FileNet P8 with full index information 22 P R O P R I E T A R Y A N D C O N F I D E N T I A L

23 Enlist the energy of your employees. Your customer-facing knowledge workers are essential to making this work. 23 P R O P R I E T A R Y A N D C O N F I D E N T I A L

24 Enlist the energy of your employees They have the most intimate knowledge of customer transactions They are the most motivated to ensure a great customer experience Employee Quotes from a Branch Capture Client Glad to see - easier to use. It is much nicer than shipping paper all over. Hope to see more departments going paperless. I was glad to see we aren't killing as many trees anymore! I felt the support system for this project was great. Thanks so much. I really think this is a great system and have high hopes it will save lots of money and time. Don t assume you have to insulate them from these changes they will embrace a better way of doing things! I think this is much more efficient and must be a cost savings as well. Love it!! I love the initiative on our company s part to help our environment! We are getting the hang of it, it's easier all the time. 24 P R O P R I E T A R Y A N D C O N F I D E N T I A L

25 t r a n s f o r m i n g P O S S I B I L I T I E S S O L I D T E C H N O L O G Y D R I V E N e x p e r i e n c e d Conclusions 25 P R O P R I E T A R Y A N D C O N F I D E N T I A L

26 Distributed Capture Best Practices Digitize paper at the first point of touch Integrate document capture into branch processes Retain as much document intelligence as possible for image classification and indexing Minimize effort and complexity for branch staff Automate classification and indexing wherever it is cost effective to do so Expect your employees to support positive change 26 P R O P R I E T A R Y A N D C O N F I D E N T I A L

27 Conclusion Banks are serving as a proving ground now for a new array of distributed capture use cases with major operational and customer benefits These emerging use cases offer truly transformative opportunities in enterprise content management Many industries with distributed, paper intensive footprints could benefit from these practices 27 P R O P R I E T A R Y A N D C O N F I D E N T I A L

28 t r a n s f o r m i n g P O S S I B I L I T I E S S O L I D T E C H N O L O G Y D R I V E N e x p e r i e n c e d Questions? 28 P R O P R I E T A R Y A N D C O N F I D E N T I A L