SUPPORT SERVICES MARKETING

OF SERVICES PRODUCTS
Session 5- Dr.P.R.Kulkarni
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MARKETING
O Generally, marketing is understood as selling of products or
services.
O Some consider advertising or promoting a product as
marketing.
O The idea of marketing is much wider. It is essentially related to
customer.
O Market : the word market is common parlance refer to the
place where goods can be sold or bought.
O Marketing :Marketing is the business function that identifies the
current unfulfilled need and wants, defines and measures their
magnitude, determines which target markets the organization
can best serve and decide on appropriate products, services,
and programmes to serve these market, thus market serves as
link between a societys need and its pattern of industrial
response-Kotler



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MARKETING MANAGEMENT
O American Management Association has defined Marketing
Management as Marketing Management is the process of
planning and executing the conception, pricing , promotion
and distribution of goods ,services and idea to create
exchanges with the target groups that satisfy customer and
organizational objective.
O Functions of Marketing Management :The functions of
marketing management are : Analysis, Planning,
Implementation and Control..
O Analysis : There is need to understand customer,trends and
changes in the environment and internal strength and
weaknesses for drawing out effective market plan.
O This require collection of information on these ares.
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O Planning : it covers both strategic planning for the long
term marketing direction of the firm selection of target,
estimate of requirement resources.
O Implementation : The implementation of strategic and
tactical plan requires staffing, allocation of task,
budgeting ,
O Control :Measurement and evaluation of progress
against the goals and target spelt.
- Products and services :A Product is defined as
anything that has the capacity to provide the
satisfaction, use or perhaps the profit desired by the
customers. Product & service are used
interchangeably in banking parlance.
- Banks products are their deposits / borrowing
schemes / other products like credit card or foreign
exchange transaction which are tangible and
measurable whereas service can be such products +
the way / manner in which they are offered.

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O What is services ? Kotler defines services as A
services is any act or performance that one party can
offer to another that is essentially intangible and does not
result in ownership of any things. Its production mayor
may not be tied to a physical product
O Characteristics of Service products :
O Intangibility : not in in the physical form lecture given.
O Inseparability : The consumer presence is in most
cases necessary at time of production.
O Heterogeneity : The services offered are not similar all
time to all customer.
O Perish ability : This means that service unit can not be
stocked.
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MARKETING OF FINANCIAL SERVICES
O The characteristics of services such as intangibility, in
separation, ,heterogeneity and perishability, are present
in financial services too.
O Financial Market in India consists of credit market, equity
market, insurance market,the money market. Mutual
funds.
O Marketing of Nanking products :Banking marketing is the
aggregate function, directed at providing services to
satisfy the customers financial needs and wants , more
effectively than competitors keeping in view the
organizational objectives of the bank. It highlight on (1)
Banks provide services (2) Aim is to satisfy customer
need (3) Nature of need financial products (4)
competitive element ,effective and
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The team model includes:
Service level management: Using service level
agreements as a basis for process/service improvement.
User support: Making end-users aware of the facilities
available and be able to exploit them to the best effect in
support of their needs.
Requirements/Change management: Monitoring the
requirements of end-users and taking them into account
during the ongoing development and delivery of services
and systems.
Relationship management: Managing relationships
with providers at all levels including: strategic, service
delivery and contractual levels.
Service management: Establishing suitable baselines
on which to track performance relating to service delivery
and capability improvement.
Business continuity: Establishing an ongoing appraisal
of risk and assuring that the necessary service
components are recognized within business continuity
plans; ensuring that business continuity measures are
adequately tested.
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MANAGING SERVICE DELIVERY
There should be a detailed
agreement of the required
service levels and thus the
expected performance and
quality of service to be
delivered.
Where the provider is an in-house
department, the level of service
required will be set out in a
Service Level Agreement (SLA).
Wherever there are formal
agreements, on service levels
as elsewhere, there is often a
need for some flexibility. This is
particularly true in the early
stages of an agreement.
Establish what levels of service are
requiredService level
management is the process of
managing the performance
provided to the customer as
specified in the contractual
performance metrics.
It balances cost and quality of
services in order to provide the
customer with value for money.
Points to be considered What needs to be done to maintain
service delivery
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Price comparisons offer a quick
and effective way to gauge
whether you are getting value for
money.
Providers could be obliged to
benchmark their own costs, or
those of their subcontractors, by
the contract.
Compare the value for money
you are getting with what other
organizations are getting.
Compare the way you manage
contracts with the way other
organizations manage theirs.
Compare prices and learn from
others.
Benchmarking is the practice of
making like-for-like comparisons
between organizations with the
aim of ensuring continuing value
for money, getting better
performance, and improving
business practices.
MANAGING SERVICE DELIVERY (Contd.)
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Risks can relate to many aspects
of the contract, including
fluctuation in demand, lack of
provider capacity, change in
requirement and transfer of skilled
staff (on either side).
All risks should be identified and
managed.
Risks should be placed with the
party best placed to manage them
possibly the provider, although
they will want compensation in
return.
Risks placed with the provider are
referred to as transferred risks.
Business risk cannot be
transferred to the provider. The
final responsibility for achieving
outcomes remains with the
customer.
Manage the risks.
Risk is defined as uncertainty of
outcome, whether positive
opportunity or negative threat.
In the area of contract
management, managing risk
means identifying and controlling
factors that may have an impact on
fulfillment.
MANAGING SERVICE DELIVERY (Contd.)
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Aim to optimise the ratio between
value and cost. Realising that
value for money is not
synonymous with lowest cost.
Carefully consider all the benefits
that the contract provides in
relation to the ongoing investment
it requires.
All costs associated with the
contract must be taken into
consideration: set-up costs,
recurring costs, fixed costs, unit
costs, and the organizations own
overhead in managing the
contract.
Ensure
Ensuring value for money is about
the trade-off between service
quality and cost.
A key objective for the
management of any contract is to
ensure that it continues to achieve
value for money over time.
Quality measures might assess
such aspects as completeness,
availability, capacity, reliability,
flexibility and timeliness, among
others.
Some aspects of a service may
be measurable by numerical
means; others may require
subjective assessment.
Measure quality as well as quantity.
The quality of the service being
delivered must be assessed.
This means creating and using
quality metrics - measurements
that allow the quality of a service to
be measured.
MANAGING SERVICE DELIVERY (Contd.)
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It will normally be the
providers responsibility to
manage service continuity,
and this will be stipulated
in the contract but it will
need to be taken into
account in the
organizations wider
business continuity plan.
Those aspects of a service
identified as critical may
require careful
consideration and/or the
creation of a Business
Continuity Plan.
Ensureservice continuity
A major part of contract
management is
considering service
continuity what will
happen if the service fails or
is interrupted.
MANAGING SERVICE DELIVERY (Contd.)
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PRODUCT
O Product :Kotler has defined product thus A product is any
thing that can be offered to market for attention , acquisition,
use or consumption that might satisfy a want or needs.
O Banking Products: Banks are in the business of accepting
the deposits for lending or investment.
O A typical retail banking product mix are :saving account,
current account, anywhere banking account, senior citizen
account.
O Fixed deposits , cumulative fix deposits, recurring deposits.
O Loans : vehicle loans, housing loans, personal loan, credit
card
O Other services : telephone bill payment, safe deposit locker
demand draft ,demat account
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PRODUCT LIFE CYCLE
O This concept is one of the fundamental notions and
affect the marketing strategies substantially.
1. This concept implies that a product have limited
life span.
2. The sale of the product during its life span passes
through distinct stages
3. Each of the stages poses different challenges
opportunities and problems
4. Profit rise and fall at different stages
5. Different marketing strategies are required for
each of the four stages
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INNOVATION IN PRODUCT DESIGNING
O Life Cycle of Product:
Every Product has a life cycle and it becomes obsolete after
the completion of its life-cycle. Therefore, it is essential to
develop new products and alter or improve the existing ones to
meet the requirements of customers
4/18/2012 15 Dr.P.R.Kulkarni

O Product Life Cycle (PLC) & Product Strategies:
- Each product passes through he following stages in its life span
O i) Introductory stage low sales, negative profits due to lack of
awareness, limited distribution and unfamiliarity with the product.
O ii) Growth stage sales tend to grow and profits increase.
Market acceptance is the key factor. Competitive strategies by other
banks can affect the growth. Promotional strategies should be changed
to keep up the sales.
O iii) Maturity stage indicator is initial stability and then slow down in
volume of sales / profit. This gives indication about changes in products /
strategies.
O iv) Decline stage downward shift / drift in sales and reduction in profit
- Using life cycle to manage marketing of products:
i. High growth rate in consumer durable, car and housing markets. Banks
started giving liberal loans. Banks introduced new products.
ii. Demand was growing, so also competition. This resulted n maturity or
saturation which compelled some banks to adjust the pricing
downwards.
iii. SB Accounts also reached maturity phase because of growing customer
awareness for higher yield products.
iv. To overcome, banks started new products like flexi - accounts & also
products which provide safety, short term liquidity, comfortable yield and
tax concessions.

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NEW PRODUCT DEVELOPMENT
O New Product Development Strategy:
It starts at the Maturity / Decline phase is due to lack of
demand or obsolescence.
Stiff competition compels a bank to think of new ideas
for survival.
Based on customer changing needs.
Based on new ideas from research and development
team.

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STAGES IN NEW PRODUCT DEVELOPMENT
Generation of Product Ideas
Screening of Ideas
Commercial Feasibility
Product Designing &
Evaluation
Test Marketing
Lunching the Product
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PRODUCT DESIGNING & EVALUATION
O The company must ask these questions: Why
would a customer buy this product ?, What would
be the benefit ?, How might this product be used ?
O Test the usefulness of the new product idea with
customers and have an understanding of the
product as viewed by the customer.
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TEST MARKETING
O Test marketing can be very time consuming,
expensive and prone to competitive sabotage.
O Companies must plan carefully during this stage.
O It is the controlled release of the product so that the
sales, customer, manufacturing and support
organizations can test and modify the product.
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LUNCHING THE PRODUCT
O Launch of product consist of following:

Developing the Market.

Correct Sales channel.

Increasing volume to support the launch.

Supporting the product.
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FEEDBACK ON PRODUCT
PERFORMANCE.
O New Product success depends on following:
Incorporating customer feedback based on Test Market
conducted.
Before incorporating feedback suitable quantitative and
qualitative measures should be analyzed.

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O Product Analysis:
- Product Mix analysis is imperative to decide on
continuance of existing products or adding new
products, based on market research in the
following aspects
Potential demand
GAP analysis
SWOT analysis for the bank

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O Strategies for growth in business & profits:
1. Market Penetration:
- Market Penetration involves increasing sales of
an existing product in existing market. This is
possible through three strategies
i. Increasing current rate of use of a product
ii. Attracting competitive customers SWOT
analysis
iii. Attracting non-users of a product cross selling

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2. Market Development strategies involve increase in marketing
effort for existing products in new markets, attracting new
customers for existing products and expanding areas of
business.
3. Product Development
4. Product Diversification
O It can be shown through the following figure:
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Existing Market New Market
Existing Products

New Products
=

=
Market Penetration A

Product Development C
Market Development B

Diversification D

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Product Strategy Market Strategies
No market change Improved market New Market
No Product
Change
Design simplification
Greater integration
Branding change
Change in package
New uses
New users
Product Change Product line
simplification
New models
Product
customerisation
Market extension
New Product Replacement of old
product
Diversification Product
Diversification

O Product Management (Contd)
O Product Development / Innovation:
Role of Product in Customer Satisfaction:
- Any product or service developed by a bank has to satisfy the needs
of the customer.
- General Need of Customers are
+ Financial Security
+ Quick Service
+ Convenience
+ Attractive Yield
+ Low Cost Loans
+ Personalized Service
+ Advice / Counselling
+ Easy Access
+ Simple Procedure
+ Attractive Package
+ Friendly Approach
+ Variety of Products
- This list is only illustrative


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O Product Management (Contd)
O Product Development / Innovation:
Role of Product in Customer Satisfaction:
- The product conceptualization and development
has to bear these needs in mind.
- For example, using the PLC approach seen
earlier a banker may group these needs into
following segments:



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- Thus some needs like safety, liquidity, better yield,
personalized service and convenient location and timing
are the common factors which have to satisfied by any
banks product.

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Young Customers A Family with teenage
children
A retired couple
Would prefer a bank which
provides security,
convenience and quick,
friendly service at convenient
hours
Would have need for proper
saving with safety of funds
reasonable yield and
availability of low cost loans
for childrens education,
convenient location and
convenient hours
Would prefer high safety,
higher yield, counselling
advice and personalized
service at convenient
location

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PRODUCT MODIFICATION
O In the maturity stage of its life cycle the sale of the
product decline.
O At this stage, efforts to stimulate sales of the product are
made by modifying the product . They are:
1. Quality improvement :Objective of improving the
functional performance.
2. Features Improvement : Additional of new features
3. Style improvement :improvement in aesthetic appeal.
The purpose of making such modification is to get more
consumers in using the products
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O Product Management (Contd)
O Product Development / Innovation:
- Innovating a product essentially means developing a product
resulting in an increase in the product line.
- New product development starts with the maturity or decline of an
existing product line or due to lack of demand or due to
obsolescence of a product. Stiff competition compels a bank to think
of new ideas for survival or success in a given market. Based on
changing customer wants and needs the banks market research
department generates new ideas.
- The very modern manifestation of new product development has
been the customer-convenient-credit card.
- Normally such ideas for new products pass through following stages:



O (Contd on next slide)

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ENHANCEMENTS / MODIFICATION BASED
ON FEEDBACK.
O Customer feedback can result into following
enhancements:

Modification in existing design of product.

Additional security features.

Customized Statement.

Online Banking facilities etc.

Based on feasibility study above feedbacks can be
implemented subject to availability of resources and
benefits.
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PRODUCT DIVERSIFICATION
O Diversification refers to entering attractive opportunities
which are outside the existing business of the firm.
O There are three types of diversifications ;
O Concentric diversification
O Horizontal diversification
O Conglomerate diversification



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BRANDING OF BANKING PRODUCT

O Brand is the name, term, sign, symbol . or design or
combination of these.
O Brand has become an important part of the product as
they import the perceived vale to the product.
O Branding of service product is not new to us.
O LIC brought out its product with brand names even when
there was no competition.
O Bank brand their product and customers are familiarized
with this brand names.
O Seven financial institutions found place in the list top 100
brands.
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O Most of them were from North American and European
region.
O Branding in the bank use to display the trust and
confidence because the customers preference was
security of money.
O City ever sleeps (city Bank), World Local bank HSBC,
trusted family bank Dena Bank, Building Relationship
beyond time and Taking technology to common man-
Indian Bank
O Good people to grow with IOB are the some of the
example of branding bank services.

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.
O Elements of Product Mix or Product Package:

- Product Mix means the total range of products offered by a bank.

- Product Mix has three main characteristics:

O i) Width, ii) Depth & iii) Consistency.
- Depth depends upon number of products in each line.

- Consistency means whether products have production affinity &
market affinity.

- Frequent changes are made in Product Mix for diversification.

- Broader Product Mix enables better business turnover and minimize
the risk of failure.




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Factors affecting Product Mix Product Package:
i. Cost of production / Delivery
ii. Demand from customers
iii. Advertising / Distribution Cost
iv. Policy of the Bank

Acceptability of Product / Product Mix depends on:
i. Consumer acceptance
ii. Satisfactory performance
iii. Adequate distribution
iv. Effective packaging/ branding
v. Good service / delivery
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O Branding in Marketing:
A brand is the name or design which identifies the products or services of
a manufacturer and distinguishes them from those of competitors.
Generally before deciding brands, the following questions have to
answered satisfactorily:
1. Is the brand name essential?
2. What brand name would suit?
3. Should product be branded separately or as a product line?
4. Is it necessary to segment a market for each brand?
5. Is brand needed for strengthening existing market segment or form a
new product?

While selecting a brand name a bank should:
i. Choose a short & simple one
ii. Prefer one which is easy to pronounce and remember
iii. Avoid confusing or negative connotations
iv. Ensure that it suits the characteristics of a product market
v. If the banks name is highly established & accepted the brand name should include
that (banks) name also like Citicard or Indbank fund or Bobcard, etc
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BRANDING IN MARKETING

Advantages of Branding to Buyers (Customers)
a) Brands are dependable guides to contents, processes,
qualities, etc
b) They make shopping of various products feasible and
convenient
c) They assure satisfaction
d) They satisfy the status needs or the emotional needs of
the customers






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Advantages of Branding to Sellers (Bank)
a) It ensures repeat sales through identification
b) It ensures product stability through customer
loyalty
c) It helps segmenting a market
d) Customer even pays a higher price for branded
product than an unbranded
e) It shields from price competition
f) Successful brands add to the corporate image of
the bank
O The brand establishes after undergoing the
following chain:
O Rejection Non-recognition Recognition
Preference Loyalty Insistence
Repeat Buying


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O Branding in Marketing: Role of Brand in
Bank Marketing:
- In banking industry as the competition is cut
throat and products are quite similar as to the
basic nature and benefits / returns to the
customers the service delivery and branding are
excellent tools which enable a bank to create
and maintain an image among the customers

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- In India the banks have been creating their distinct marks by
establishing sign offs for their total image like A bank with
personal touch or Friendly Bank, Good to Bank With; Bank to
bank upon or Growing with you, etc.
- Such sign offs, indicates the positioning adopted by a bank within
the perceptual marketplace to gain a more advantageous
position
- Some examples of brands are:

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Bank Prodcut Brand
Citi Bank
State Bank of India
Canara bank

Indian Bank
Citi Bank
Credit Card
Mutual Fund
Growth Fund Schemes

Housing Loan
Car Loans
Citi Bank card
SBI Mutual Fund
Can Growth
Can Share
Ind Shelter
Citimobile
O Branding in Marketing:
- It can be, therefore, said that brands are very important as
product (marketing) strategy in marketing of banks services
as branding indicates how the organization chooses to use
branding as an integral part of its overall marketing strategy
- To the customer such brand name means a means to identify
the product and differentiate the product from other similar
products in the market.
- In a customers language, two questions have to answered
satisfactorily in this branding effort:
i. What is it in this bank which is different form other banks
in terms of its position, sign off and product range?
ii. What are the product brands which are more beneficial
which this bank offers distinct from other banks products?


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PRICING OF BANKING PRODUCTS
O Price is the second major element of marking mix.
O Price is the only one that generate revenue while other
elements incurred cost.
O Several factors influence price and hence its determination is
complex process.
O Objectives of Pricing: there are several objectives which
firms have in pricing.
O Out of these objectives some are primary and secondary
O The objectives generally pursued by the firm in setting prices
of product can broadly classified in seven major objective
1. Profit 2. survival 3. Market shre 4. Cash flow 5. status-quo 6
Product quality 7 communication image
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PRICING OF BANK PRODUCT AND SERVICES
O There are two major cost which have to considered while
pricing bank products
O They are (a) interest cost (b) servicing cost
O Normally interest cost constitutes 67% o the price and
service cost is around 33% in any bank products . Bank
now price each of their services.
O Traditionally, bank have been adopting pricing (ROI) on
the basis of value of loan or best on the development of
priorities.
O But these days ROI offered deposits and charge on loans
and advances is :
1. Cost of fund based
2. Market related
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O Other factors which impact in Bank pricing :
1. Risk and Return
2. Monetary Policy
3. Capital adequacy
4. Cost befit analysis

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DISTRIBUTION CHANNEL

O The goods reach from producers to consumers
through a chain of entities associated with the
process directly or indirectly.
O Service products (bank) have distinct
characteristics hence the distribution of service
product is complex.
O Banking services mainly depend upon direct
distribution through own net work of the branches.
O With the technological revolution in banking in
addition branches many more delivery channels are
used by the banks to make their product reach the
customer.

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O Branches are the primary distribution outlets for
banking services. These fixed in location and
consumers are required to visit the branch for the
transactions.
O Technological Channels :
O Telephone banking and call centers
O Automated teller machines
O Personal computer
O Plastic cards
O Virtual branches and automated video banking.


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SALES & DISTRIBUTION SYSTEM

O Sales Promotion:
- Sales Promotion means, the banks well organized, planned
and goal oriented efforts which must 52be in line with its
overall business goals and objectives in the desired market
areas keeping specific needs of customers in mind.
- The promotion efforts include the communication channels of:
o Advertising
o Publicity
o Sales Promotion
o Person-to-person communication
o Banks internal communication process, etc.


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O Composition of Product Mix

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Mass Communication Person-to-Person Communication
Advertising Personal Sales
Publicity Internal Communication
Sales Promotion
Public Relation

O Objectives of Sales Promotion:
Objectives of Sales Promotion are:
1. Informing/telling/educating potential customer
2. Informing existing customers about new products / services
3. Following up with existing/potential customers for schemes introduced
4. Approaching a new segment of customers to attract them to promote new
scheme.
O Distribution Channels:
Direct Channels:
i. Branch Network
ii. Electronic Channels ATM, Internet Banking, Phone
Banking, Mobile Phone Banking, Online Anywhere Banking,
etc
iii. Banking at door step
In-Direct Channels:
i. Direct Marketing Agents (DMS)
ii. Direct Selling Agents (DSA) Telemarketing Executives
(TMEs), Field Sales Personnel, namely Direct Sales
Executives (DSE),/ Business Development Executives
(BDEs)
Issues to be considered:
+ Channel Selection
+ Channel Management
+ Empanelment of channel partners
+ Monitoring a channel partner integrity, performance &
productivity rewards.



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DSA (DIRECT SELLING AGENTS)
O WITH limited branch networks, private sector banks are
increasingly depending on outside agencies to sell their
retail products
O These sales personnel are given variable pay depending
on the volumes of business they bring in, making the
situation very tricky if the bank is not careful in tracking the
quality of the assets they bring in.
O ICICI Bank has seen 100 per cent of its incremental growth
in its home loan portfolio through its DSA network. Home
loans disbursed by ICICI Bank for the year 2002-03 were
Rs 7,000 crore. Even its, by now famous, `loan melas' are
conducted by DSAs under the supervision of its
employees.
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BANKER AS A DSA/DMA
O In a bank branch DSA/DMA is the branch manager,
officer, manager , marketing manager, the front line
people and sub staff who offer various services
O The banking offers various non conventional services to
customers.
O The job of the DMA/DSA is to collect the information
about the customer with all details and create a data
base.
O Create awareness among the customer educate them
about the user friendliness of the system.
O Convince them about the security aspects, generate
report to accommodate the need of the customers and
management.

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DMA (DIRECT MARKETING AGENTS)
Role of Direct Marketing Agents in banks are following:
O To market and publicize the loan schemes / products of banks
O DMA collect the loan applications of the interested parties with requisite
fees as per rules of the bank in the shape of cheques / draft and deliver
to the concerned bank's branch.
O To carry on thorough verification of the account to be introduced of the
applicants, seller of the property, guarantors and property to be provided
as security for loan.
O To educate the customers on the policies and terms of lending of bank
and to cover the company against any claim or damage arising out of
non-compliance of any of the terms and conditions as above.
O To ensure regular payment of installments in the accounts introduced by
him and timely deposition of Post Dated Cheques.
O To ensure recovery in the event of default / non-payment in any account.
O To protect the interest of the company and ensure that image of the
company is not tarnished by any deeds performed / statements made by
him.


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O Direct Selling Agents (DSA)
O Code of Conduct for Direct Selling Agents:
Declaration to abide by the Code of Conduct
Salient aspects of the Code of Conduct
4 Tele-calling a prospective customer (Prospect)
- Consent to be obtained
- Not to call a person who is flagged in do not disturb list
4 Time of contact normally between 09:30 hrs & 19:00 hrs
4 Maintain prospects privacy
4 Leaving a message in the event when the prospect is not
available the message must indicate the purpose of call; is
regarding, selling or distributing a bank product.
4 No misleading statements / misrepresentations permitted
4 Tele-marketing antiquates pre-call, during call, post-call.
4 Gifts or bribes not to accept any gifts / bribes of any kind from
prospects
4 Precautions to be taken on visits / contacts maintain adequate
distance, no visiting large numbers, etc
4 Other important aspects appearance & dress code

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MONITORING A CHANNEL PARTNER
O As channel partnerships develop and become more
complex, however, the need to measure their effectiveness
becomes crucial. banks not content with mere incremental
revenue are looking for ways to analyze channels, refine
them for maximum return and avoid any pitfalls.
O the most sophisticated metric is analyzing which individual
partners is performing well or poorly. That means finding
ways to assign appropriate sales allocation to individual
activity and pinpointing the exact location of the point of
sale,
O Automated systems, such as MarketStar's
PartnerDynamics software, can help manage channel
initiatives with a list of daily activities for specific DSAs
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INTEGRITY
O Globally, the banking and financial services sector is one of
the largest users of information systems. This has held true
in India too, where banks and financial institutions are one
of the largest deployers of IT in the country.
O With the RBI actively encouraging the banks to shift to
internet banking and advocating real-time clearing
systems, the IT adoption rate in the banking industry is
bound to increase. Banks with a smaller footprint are also
catching up with the larger players in moving towards
connected systems. As technology adoption takes place on
a war footing, care should be taken that effective security
systems and IT safeguards are in place.
O The off shoring of the back end processing transactions of
global financial institutions to India has increased the
importance of security. Maintaining the integrity,
confidentiality and availability of data is a new concern that
banks have to contend with.
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PRODUCTIVITY REWARDS
O Cash incentives are in the form of a bonus. A bonus is an
incentive payment that is supplemental to the base wage. It
has the advantage of providing employees with more pay
for putting out a greater effort. A Spot bonus could also be
used; it is an unplanned bonus given for an employees
effort unrelated to an established performance measure.
For example, an employee may receive a spot bonus for
working long hours to keep a client or fill their order. Many
service managers are finding that cash is not as powerful
for motivating a employees performance. Today's
employees want more from their jobs than just money;
people want higher positions and internal recognition
O Incentives can also be in the form of non-cash items. The
most popular of the non-cash incentives include free
merchandise, travel, recognition and status. Other types of
non-cash incentives are, tuition credits, shares of stock,
consumer merchandise, flexible working hours, company
car, paid time off as well as health services
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18 April 2012 Dr. P.R Kulkarni 62
FINANCIAL PLANNING AND FINANCIAL ADVISORY
RESPONSIBILITIES
O Financial planning is the process of establishing personal and financial goals of an
individual and his/her family and meeting them through proper management of
his/her personal finance. The financial goals may involve buying a home or a car,
childrens marriage and education, funds for medical treatment, retirement,
vacation abroad etc. The on-going process involves taking stock of all existing
resources, developing a plan to use them, and systematically implementing the
plan in order to achieve short and long-term goals. The plan must be monitored
and reviewed periodically so that adjustments can be made, if necessary, to
assure that it continues to move toward the clients financial goals.

Financial Planner is an expert in the process of financial planning which essentially
involves: establishing and defining the client-planner relationship; gathering client
data, including goals; analyzing and evaluating the client's financial status;
developing and presenting financial planning recommendations and/or
alternatives; implementing the financial planning recommendations and monitoring
the financial planning recommendations. Using this process, financial planner can
help his clients work out where they want to be financially and what needs to be
done to be there. Financial Planner specifically gives his analysis and advice on
personal financial statements, investments, taxation, debt & risk management,
cash flows, insurance, stocks, trusts, retirement and other components of personal
finance.

18 April 2012 Dr. P.R Kulkarni 63
FUNCTIONS AND RESPONSIBILITIES
O Financial Planning Services - Inflation, falling interest rates
and fluctuating market conditions require to plan finances
carefully
O International Services -
O Mutual Funds -
O Business Select - a range of financial services and
personalized business-banking solutions that help to
maximize business potential
O
18 April 2012 Dr. P.R Kulkarni 64
MEANING AND CONSTITUENTS OF WEALTH
MANAGEMENT
OWealth Management is a professional service which
is the combination of financial/investment advice,
accounting/tax services, and legal/estate planning for
one fee.
OWealth Management is classified as an advanced
type of financial planning that provides individuals
and even families with private banking, estate
planning, asset management, legal service
resources, trust management, investment
management, taxation advice, and portfolio
management. Thus, wealth management
encompasses asset management, client advisory
services, and the distribution of investment products.
18 April 2012 Dr. P.R Kulkarni 65
ADVISORY ROLE
O Wealth management is a high level form of private banking
that provides various types of investment, insurance and bank
products and services.
O Persons engaged in wealth management usually work for
brokerage firms, large banks, trust departments, or
investment and portfolio management firms. Boutique firms
such as a Registered Investment Advisor also tend to provide
a wide array of family office services.

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