Introduction to Retail Bank MarketSim
Mike Allen
Objectives
Overall objectives of school
Objectives of your first year
Your scenario
Navigation of the model/simulation/”your new reality”
Schedule, process and what’s next
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Objectives
What we will accomplish in the next 11 days &
in the next 3 years.
CBA Executive Banking Objectives
Retail Strategy
Financial Strategy
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•
•
•
• Financial analysis
• Key performance
drivers
• Earnings power
• Risk considerations
Customer acquisition
Branding & marketing
Product & pricing
Delivery optimization
Bank Management
Strategy
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•
•
•
Economic value & risk
Capital considerations
Analyst influences
360° executive
management
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Experiential Education
• Proves multiple ways for to learn & process
information
• Leads to ways to think, not how to think
• Creates ability to respond to new issues
• Full immersion without drowning
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Experiential Education
Educational
Framework
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MarketSim Objectives
Retail Strategy
Financial S
•
•
•
•
• Financial an
• Key perform
drivers
• Earnings po
• Risk conside
Customer acquisition
Branding & marketing
Product & pricing
Delivery optimization
Bank Management
Strategy
• Economic value & risk
• Capital considerations
• Analyst influences
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MarketSim Objectives
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Generate insight into the interplay between key retail
strategies in product lines and pricing, delivery
channels, customer segmentation, marketing and
branding.
Evaluate trade-offs in decision-making while solving
to a business plan and Balanced Scorecard.
Inspire elevated cross-departmental teamwork and
integration with the greater goals of the retail bank.
Link content from the simulation to business
objectives.
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MarketSim Objectives
How are we going to get there?
• Retail Banking Simulation
• Live Bank Case
• Tactical Case
Lectures
• Main Lecture Room
• Community Rooms
• Team Rooms
Intersession Assignment
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Your Scenario
Your Scenario
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You and your management team have just been
appointed to run retail for this bank.
Prior management has elected to run it the Old
Way.
You are not differentiated at all from your
competition.
Your CEO has said “We need to make more money
in Retail and I Hope it works out for you!”
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Your Scenario
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You are a team of retail professionals.
You will get a lecture on a subject and then your
team must decide who, what, how much, and
how.
You are in a community with 4 other banks and
“monoline” national players.
A computer model will be used to simulate the
results of you decisions in the market.
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Your Scenario
Your Scenario
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Starting Point sent previously
Each bank starts at the same place
NOT a very well run retail bank!
Reports shows Customers, Delivery, Product, and
Financial data
Worksheets provide forecast tools
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Your Scenario: Roles
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Your Scenario
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How we’ll keep score
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Your Scenario
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A stock analyst will analyze each team in a
community. Results are based on balanced
scorecard fundamentals.
They will then rank each team against the other 4
and compute a Balanced Scorecard Index (BSI)
The analyst uses this to HYPE Stocks.
The analyst then publishes this for all their sales
force to see.
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Your Scenario
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Navigating MarketSim
Tour of the Simulation/Model
www.retailbanksim.com
Navigating MarketSim
x
Customer Design
Team selects target markets
and invests in marketing
Product Price
Team selects products
and product features
= Product Revenue
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Variable Costs
-
Fixed Costs
=
Income
Team determines pricing
Team defines distribution
architecture
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In case you thought this is easy…
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Navigating MarketSim
Change levers, such as
investing in customer
marketing, effect appeal
along one or more
dimensions
Checking Reg
Checking Gold
Savings
Investments
Loans
Just Starting
Working Poor
First House
Emerging Affluent
Blue Collar
Single Income
Pre-retired
High-income M&S
Money Mogul
Target marketing
decisions (e.g. to Blue
Collar Segment) affect
appeal across this band
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Navigating MarketSim
Checking Reg
Checking Gold
Savings
Investments
Loans
Just Starting
Working Poor
First House
Emerging Affluent
Blue Collar
Single Income
Pre-retired
High-income M&S
Money Mogul
Product Change
decisions (e.g. to
Checking Gold) affect
product appeal across
this band
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Navigating MarketSim
Checking Reg
Checking Gold
Savings
Investments
Loans
Just Starting
Working Poor
First House
Emerging Affluent
Blue Collar
Single Income
Pre-retired
High-income M&S
Money Mogul
Distribution Change
decisions (e.g. to Light
Industry area) affect
appeal to customers in
cells across this band
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Navigating MarketSim
Checking Reg
Checking Gold
Savings
Investments
Loans
Just Starting
Working Poor
First House
Emerging Affluent
Blue Collar
Single Income
Pre-retired
High-income M&S
Money Mogul
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Changing Levers Impact
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Changing Levers Impact
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The Schedule
For the next 11 days
Consumer Bankers Association
Executive Banking School: Year 1
8:00
8:30
9:00
9:30
10:00
10:30
8:00-9:00 JH 101 9:00-10:00 JH 101
Sun Welcome &
7/19 Introductions
11:00
11:30
12:00
12:30
1:00
10:00-12:00: JH 101
Surface
Orientation
2:00
2:30
3:00
3:30
4:00
4:30
5:00
1:00-2:30 JH 101
2:30-4:00 JH 101
4:00-5:00 Comm Rm
MarketSim
Financial Reports
Surface
Workshop
Leadership
12:00-1:00
Intro to MarketSim
(Callahan)
LUNCH
(Allen)
(Smythe)
Mon
7/20
8:00-10:00 JH101
10:00-12:00 JH 101
Strategic Planning
Balanced Scorecard
12:00-1:00
(Underw ood)
(Allen)
LUNCH
8:00-9:00
1:00-3:00 JH 101
9:00-10:30 Team Rooms
10:30-12:00 JH 101
Initial Plan
Presentation
Customer Segmentation
and Marketing
8:00-9:00 JH 101
9:00-10:30 Team Rms
10:30-12:00 JH 101
Live Bank
Case:
Customer
Team
Exercise
Product Design
& Pricing
8:00-9:00 JH 101
9:00-10:30 Team Rms
10:30-12:00 JH 101
Live Bank
Case:
Product
Team
Exercise
Delivery Strategies
12:00-1:00
(Travis)
LUNCH
8:00-9:00 JH 101
9:00-10:30 Team Rms
10:30-12:00 JH 101
Live Bank
Case:
Delivery
Team
Exercise
Leadership II
12:00-1:00
(Callahan)
LUNCH
Tue
Team Rooms
7/21 Team Exercise
3:00-4:00
Retail Bank Performance Analysis Comm Rooms
(Vanderheide)
Debrief
1:00-2:00 JH 101
2:00-4:30 Team Rooms
Marketing
Functional
Decision 1
Team Exercise
12:00-1:00
LUNCH
4:00-5:00
Team Rooms
Team Exercise
(Underw ood)
Wed
7/22
Thur
7/23
Fri
7/24
8:00
8:30
8:00-9:00
1:00-1:45
1:45-2:30
2:30-5:00 Team Rooms
12:00-1:00
JH 101
Comm Rms
LUNCH
Product
Functional
Debrief
Decision 2
Team Exercise
1:00-1:45
1:45-2:30
2:30-5:00 Team Rooms
JH 101
Comm Rms
Delivery
Functional
Debrief
Decision 3
Team Exercise
(Frisbie)
Saturday, July 25: No Classes
9:00
9:30
10:00
10:30
11:00
11:30
12:00
12:30
1:00
9:00-10:30 Team Rooms
10:30-12:00 JH 101
Sun Community Rooms
7/26
Debrief
8:00-9:00
Mon Community Rooms
7/27
Debrief
1:00-2:15 JH 101
2:15-4:00 Team Rooms
4:00-5:00
CRO/CFO
Business Plan
Functional
Business Plan Development
Team Exercise
Team Rooms
Business Plan
Presentations
1:30
2:00
1:00-2:30 JH 101
2:30
3:00
3:30
4:00
2:30-4:00 Team Rooms
4:30
4:00-5:00
Performance
Analysis II
Tactical Case Study
Team Exercise
Team Rooms
Decision 4
Team Exercise
Integrated Decision
Making
(Allen)
(Vanderheide)
9:00-10:30 Team Rooms
10:30-12:00 JH 101
1:00-2:30 JH 101
2:30-5:00 JH 101
Decision 5
Team Exercise
Ethics
12:00-1:00
Ethics
(Smythe)
LUNCH
(Smythe)
Live Bank Case:
Strategy & Wrap-up
12:00-1:00
LUNCH
5:00
Tactical Case
Presentations
(Allen & Underw ood)
8:00-9:00
Tue Community Rooms
7/28
Debrief
9:00-10:30 Team Rooms
10:30-12:00 JH 101
Decision 6
Team Exercise
Current Topics
12:00-1:00
(Hippensteel)
LUNCH
**7:30 Start Time**
Wed
7/29
7:30-9:45 Community Rooms
MarketSim
Presentations
1:00-2:00 JH 101
2:00-3:00 JH 101
3:00-5:00 Team Rooms
Intrasession
Assignment
Regulatory
Update
Analysis and Presentation
Development Team Exercise
(Gambucci)
(Hunt)
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MarketSim Process
With all of the this you will need a process
Your Process
Time
Management
Communication
Focus via
Visual Aids
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Your Process
Analyze
Review
Plan
Retail Bank
MarketSim
Process Flow
Execute
Forecast
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Your Process
Reports
Analyze
Review
Plan
Retail Bank
MarketSim
Process Flow
Worksheets
Decision
Inputs
Execute
Forecast
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What’s Next
Your Process
Analyze
Review
Plan
Retail Bank
MarketSim
Process Flow
Execute
Forecast
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What’s Next
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

1:00
Developing tools to analyze your MarketSim Bank
Deal with any lingering issues with your Surfaces
1:30
2:00
2:30
3:00
3:30
4:00
4:30
5:00
1:00-2:30 JH 101
2:30-4:00 JH 101
4:00-5:00 Comm Rm
Intro to MarketSim
MarketSim
Financial Reports
Surface
Workshop
(Allen)
(Smythe)
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Finally…
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It’s okay to be a little nervous
It’s okay to get a little lost
It’s okay to get a little distracted
It’s okay to make mistakes
It’s okay to have fun!
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Sit tight, Dr. Tom is next!
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