Page 65 -

64 Part I • Decision Making and Analytics: An Overview

business environment challenges in mind, along with 8. Search the Web for a company that uses the four major
Mintzberg’s 10 managerial roles (see Table 1.2), identify components of a standard BI system.
five such roles in companies/government’s press release 9. In the company identified in the previous question, illus-
and communications. trate their main products and style of BI and discuss the
7. Go to oracle.com, a leading company in BI. Make a map main tools used. Refer to the tools mentioned in this
of their Web site illustrating their products and communi- chapter.
cation styles with available resources for business.

end-of-Chapter Application Case

Nationwide Insurance Used BI to Enhance Customer Service
Nationwide Mutual Insurance Company, headquartered in than 48 sources into a single customer data mart to deliver a
Columbus, Ohio, is one of the largest insurance and financial holistic view of customers. This data mart was coupled with
services companies, with $23 billion in revenues and more Teradata’s customer relationship management application to
than $160 billion in statutory assets. It offers a comprehensive create and manage effective customer marketing campaigns
range of products through its family of 100-plus companies with that use behavioral analysis of customer interactions to drive
insurance products for auto, motorcycle, boat, life, homeown- customer management actions (CMAs) for target segments.
ers, and farms. It also offers financial products and services Nationwide added more sophisticated customer analytics
including annuities, mortgages, mutual funds, pensions, and that looked at customer portfolios and the effectiveness
investment management. of various marketing campaigns. This data analysis helped
Nationwide strives to achieve greater efficiency in all Nationwide to initiate proactive customer communications
operations by managing its expenses along with its ability to around customer lifetime events like marriage, birth of child,
grow its revenue. It recognizes the use of its strategic asset of or home purchase and had significant impact on improv-
information combined with analytics to outpace competitors ing customer satisfaction. Also, by integrating customer
in strategic and operational decision making even in complex contact history, product ownership, and payment informa-
and unpredictable environments. tion, Nationwide’s behavioral analytics teams further created
Historically, Nationwide’s business units worked inde- prioritized models that could identify which specific cus-
pendently and with a lot of autonomy. This led to duplication tomer interaction was important for a customer at any given
of efforts, widely dissimilar data processing environments, and time. This resulted in one percentage point improvement
extreme data redundancy, resulting in higher expenses. The in customer retention rates and significant improvement
situation got complicated when Nationwide pursued any merg- in customer enthusiasm scores. Nationwide also achieved
ers or acquisitions. 3 percent annual growth in incremental sales by using CKS.
Nationwide, using enterprise data warehouse technology There are other uses of the customer database. In one of
from Teradata, set out to create, from the ground up, a single, the initiatives, by integrating customer telephone data from
authoritative environment for clean, consistent, and complete multiple systems into CKS, the relationship managers at
data that can be effectively used for best-practice analytics to Nationwide try to be proactives in contacting customers in
make strategic and tactical business decisions in the areas of advance of a possible weather catastrophe, such as a hur-
customer growth, retention, product profitability, cost contain- ricane or flood, to provide the primary policyholder infor-
ment, and productivity improvements. Nationwide transformed mation and explain the claims processes. These and other
its siloed business units, which were supported by stove-piped analytic insights now drive Nationwide to provide extremely
data environments, into integrated units by using cutting-edge personal customer service.
analytics that work with clear, consolidated data from all of
its business units. The Teradata data warehouse at Nationwide financial Operations
has grown from 400 gigabytes to more than 100 terabytes and A similar performance payoff from integrated information was
supports 85 percent of Nationwide’s business with more than also noted in financial operations. Nationwide’s decentralized
2,500 users.
management style resulted in a fragmented financial report-
ing environment that included more than 14 general ledgers,
integrated customer Knowledge 20 charts of accounts, 17 separate data repositories, 12 different
Nationwide’s Customer Knowledge Store (CKS) initiative reporting tools, and hundreds of thousands of spreadsheets.
developed a customer-centric database that integrated cus- There was no common central view of the business, which
tomer, product, and externally acquired data from more resulted in labor-intensive slow and inaccurate reporting.

M01_SHAR9209_10_PIE_C01.indd 64 1/25/14 7:46 AM