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Technology just part of the transformation equation

By John Oates

Canadian credit union BlueShore has used technology to power a radical change of direction which has more than doubled its assets with no increase in customers.

The business was founded in the 1940s to serve local shipworkers and fishermen two markets which saw sharp declines from the 1970s onwards.

Chief executive Chris Catliff said: “We were a blue-collar credit union that kind of Rip Van Winkled and awoke in a white-collar world. We had to completely change what we did.”

The team changed the name to BlueShore Financial and opted to use data analytics to create a brand new strategic direction.

This meant leaving the highly competitive and price sensitive environment of retail banking and shift to offering financial advice and services to wealthier customers.

It went against trend by keeping its branches but transforming them into friendly advice centres complete with coffee and children’s play areas to make meetings easier for families. This, along with sophisticated customer relationship management systems, allows the company to provide a complete portfolio of financial and investment advice not just retail banking services. The branches are staffed by financial advisors rather than bank tellers, it aims to feel like a private bank without the private bank fees.

The strategy has helped BlueShore increase assets under management by 144 per cent between 2005 and 2016 from $1.8 billion to $4.4 billion(Canadian dollars).

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BlueShore considers Hewlett Packard Enterprise a genuine partner in its business. Teams from the two companies meet every two weeks for brainstorming sessions to consider new services.

Client data is stored on an HPE private cloud hosted in a secure offsite facility. HPE deals with monitoring operating systems, patch management and hardware support.

BlueShore owns the actual hardware – HPE ProLiant Blade servers and 3PAR StoreServ arrays which prioritise storage according to how often data is accessed.

BlueShore can shift data around from its core banking, CRM, Business Intelligence (BI), and content management systems.

The core banking system is based on a Temenos T24 banking platform modified for BlueShore’s requirements. HPE worked with Temenos and Microsoft, the company deployed the first-ever Temenos T24 environment on Microsoft Windows SQL running on HPE servers, storage and networking – the first ever non-Unix deployment. BlueShore uses HPE security monitoring solutions and hosting management services to ensure 100% uptime for its banking services and self-service digital channels.

Client relationship management has been central to the company’s ability to transform itself. Although assets have grown massively BlueShore has about the same number of customers – 40,000.  BlueShore’s CRM system is based on customized Pivotal software from Aptean that pulls information from a Temenos Analytics BI system.

To make the very best use of the customer data which it collects BlueShore has built its own proprietary algorithms called “Bluegorithms” to guide offers to the right customers. These look at data from various sources to try and predict customer requirements and how they would prefer to receive the information, whether in-branch or electronically or by phone. This business intelligence is key to allowing BlueShore sell its customers further services and products beyond retail banking.

But Catliff stressed that algorithms alone are not enough:A lot of our data comes in through humans, and it gets translated back to humans by humans. I believe that business model will survive for a long time.”

The company continues to develop systems and services and adapt the way it offers them to customers. It is experimenting with ‘robo-advisors’ which use algorithms to change the way customer money is managed.

Looking forward Catliff said: “The smartest companies disrupt themselves.”

There’s more on BlueShore’s transformation here:

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