Facing deregulation and administrative challenges, the Bank of Cyprus deployed a data warehouse based on Microsoft SQL Server 2000 to improve decision support processes, speed of information retrieval and customer retention. The improved connectivity and flexibility has significantly reduced development man-hours and cut IT maintenance costs. The bank's financial, credit risk and marketing departments among others, now have access to up-to-date information on more than 400,000 customers. This is a valuable marketing and financial analysis tool as the bank expands its product offerings.

The Bank of Cyprus is Cyprus' largest financial institution and has 200 branches on the island. Founded over 100 years ago, it has branches in Greece, the UK, Australia and Channel Islands, as well as representative offices in Canada, South Africa, the US, Russia and Romania. In Cyprus alone, the bank has more than 400,000 customers.

In 1999, the bank faced one of the biggest challenges in its history. Banking on the island was liberalised and competition increased. At the same time, the country was getting ready to enter the European Union, resulting in administrative headaches for banks all over the island.

To meet these challenges, the Bank of Cyprus launched a project to modernise its customer records, improve customer service and increase efficiency. But it didn't want to waste its existing IT investment. Any new infrastructure had to leverage the bank's existing hardware and network infrastructure, namely IBM mainframes and AS400s, NCR and Digital UNIX Boxes, financial and other applications from multiple software vendors such as ALLTEL and Unisys. Philippos Leandrou, head of the MIS development team with the Bank of Cyprus says: "We wanted to apply new development and project management methods, but we didn't want to replace all of the technology. This meant we needed strong integration from new products."

Improved decision support

The bank was determined to accelerate information delivery and improve decision support. A data warehouse would allow the IT team to work with departments throughout the bank, such as marketing, finance and credit risk, on more effective customer retention and acquisition programs, better customer segmentation and faster, ad-hoc information retrieval.

For example, the bank could see which customers use Visa credit cards most often, and offer them improved incentives. "It was all about improving the relationship with the customer," Leandrou says. "A good CRM program has to be based on a good open data warehouse and that is where Microsoft has excelled." Working with Microsoft solution provider Mechatronic Systems Integrators Ltd (MSI), Leandrou's team settled on an end-to-end Microsoft solution, centering on a new data warehouse that would store 500,000 sets of customer records.

MSI has worked with Cyprus Airways,Cyprus Telecommunication Authority and other large organisations in Cyprus. The bank of Cyprus had also previously worked with MSI on the installation of new network routers, explains Chloe Votsi, business development manager with the company. "Our customers know that we will deliver what their business needs, not what we need. After negotiations, it was decided that the bank should standardise on a Microsoft platform."

Over a period of nine months, the in-house IT team at the Bank of Cyprus rolled out Microsoft SQL Server 2000 and Microsoft Windows 2000. Using Microsoft Visual Basic 6.0 and Visual Studio, the four-strong developer team created custom tools to analyse data, as well as using online analytical processing (OLAP) development, deployment and data mining tools included with SQL Server. In addition, the bank used Microsoft Excel 2000 Pivot table services on the client side to deploy the OLAP and reporting tools.

"Everything we needed to build the data warehouse was available from Microsoft, which wasn't the case with competing products. In addition, the Microsoft solution architecture was so open that,whatever third-party client tool we tried was perfectly integrated within our data warehouse framework," says Leandrou.

Increased Productivity:

In February 2000, the bank launched a pilot project based on Microsoft SQL Server 7.0. "In that year we increased productivity perhaps ten times," says Leandrou. "Information delivery requirements that would have taken weeks or months to develop in the past - because of traditional development times - could now be done in minutes or days." The IT team has been freed from developing reporting and information retrieval solutions for the end-users. It is now able to plan for the bank's forthcoming CRM imple-mentation and further extension of the functionality, history depth and information available in the data warehouse.

The pilot data warehouse, which holds all the information available for all the bank's customers in-house, was made available to analysts and other users at the headquarters and users in October 2000 and has far exceeded the bank's expectations. "The interoperability and flexibility is amazing," says Leandrou. "We moved from multiple platforms including NCR and IBM systems to Microsoft and I can't think of another single vendor solution that would have worked as well."

The users of the data warehouse can now design and process their own reports without the IT experts getting involved. They can also enter ad-hoc queries and retrieve the results in real time. In the past, it could take weeks of development work to satisfy such user requests. "We took 56 such requests last month, and processed them all within the same day of the request. Previously it would have taken us three months," says Leandrou.

Implementing a Microsoft-based solution has been highly cost effective. Although the system is too new for executives to assess total cost of ownership, the bank expects to achieve a very high return on investment - several times as high as with previous systems. That is unlikely to have happened without the integration and flexibility of Microsoft's products, says Votsi. "We strongly advised the bank to standardise on Microsoft because it offers the best reliability at the best price," she says. "As time goes on, the maintenance costs will be half the cost of other platforms because Microsoft supports its products so well."

The Bank of Cyprus is well positioned to understand the benefits of its Microsoft-based system - it had previously considered rolling out a data warehouse in 1996 working with other vendors."

The project didn't finish for lots of reasons, but mainly because we were not mature enough to absorb the costs and resources it would have required," says Leandrou.

Open architecture

When the bank returned to the idea of a data warehouse in 1999, it was with a better understanding of the products available. "We decided to adopt an open and proven architecture. That is why we chose Microsoft. It was the most open option. We do not see any problems with the scalability of this system for at least two years," says Leandrou.

because it offers the best reliability at the best price," she says. "As time goes on, the maintenance costs will be half the cost of other platforms because Microsoft supports its products so well."

The IT team is so pleased with the success of the project that it is now planning a global data warehouse to support the bank's CRM initiative. "We currently enter customer data monthly but we will soon begin entering it weekly and finally daily," says Leandrou. "It means that we will be able to pick up problems or trigger important events far more quickly and take rapid action in response to risk management issues and marketing opportunities."