1st Answer

Introduction: Banks have incorporated a working culture where data is at the centre
of making decisions and strategic planning. Data analytics in banking would enable
them to contextualize as well as personalize their products and services in order to
cater to their consumers in a better way and have a customer-centric approach to
grow the business.
Concept and Application:
Following are the types of data analytics:
Descriptive Analytics: This analytics provides the facts that state what has
happened. It is the simplest type that enables to condense big data into smaller, and
much more useful nuggets of information. It is the most basic for of analytics that is
performed by more than 90% of banks. This is the starting point of any analytics and
alone consists 80% of the business analytics.
Descriptive analytics enables the business learn from its past behavior and how it
would impact the future. It would provide information that would enable to
understand the performance of the business on an aggregate level.
Diagnostic Analytics: It is the second kind of analytics; this would focus on the past
and try to ascertain why something has happened. It is also known as root cause
analysis as it would look deeper to understand the root cause of the events. It
enables the bank to isolate the patterns in order to identify the source of these
patterns and the factors impacting the business.
The diagnostic analytics enables to understand, for instance, why there has been a
sudden surge or a reduction in the sales.
Predictive analytics often make use of the gathered data and the descriptive and
diagnostic analytics result in order to tell what is likely to occur in the future at the
granular level.
This is where the insight into the previous steps can be used into actionable insights
to make a decision. It makes use of involving forecasting in the future, predicting the
trends of the market, changing behaviours of consumers and analyses the
competitors to optimize and establish strategies to enhance the business results.

Following are some examples of how banks and financial institutions make use of
data analytics to manage the risk:

Fraud Detection: While reduction of frauds is a common goal for banks and
financial institutions, analytics can be used in order to manage risk instead of only
detection of fraud:

Analytics often can be used in order to ensure the identity and rate of individual
customers who are at the risk of fraud, and then different level of monitoring has to
be applied to those accounts.
Analysing the risk of accounts enables the banks and financial institutions to know
what must be prioritized in their efforts of fraud detection.

Risk Modelling for investment banks: It is the process of stimulation of how a

portfolio of assets or a single asset would move in response to various scenarios.

When risk modelling is done in a correct manner and consistently across the assets,
one can reduce the overall risk of portfolio and improvise in terms of performance.

For instance, if a bank wishes to do an investment banking transaction, they would

need to consider the following:

• What are the anticipated returns

• What are the risks
• What is their probability
• How important is this transaction as compared to other alternatives

Risk models are used in many fields with financial institutions to describe how risky
things have been, what is likely to happen, and how much it would cost to eliminate
the risk.

Following is an example of how banks and financial institutions make use of

analytics to manage supply

Sales Performance analysis: When a customer walks through the doors, there is a
wide range of things that can happen. Someone could walk in and tell that they have
Rs. 2 lakhs in cash which they want to deposit to open a checking account.

Or maybe they are meeting with a banker who would be looking for an investment.
Whatever the case, when the individual is selling something, there is one thing that
would always happen.

So, it isn’t obvious that how much money, and how much would impact the
performance analysis has on the amount of money gained by the company and how
it impacts the business and whether they can keep growing. The answer to that
question would depend on various factors. How many consumers can come in?
What do they have to purchase. And which ones do enough business to generate a
difference.

Performance analysis refers to another way to measure the performance over a

period of time, whether it is sales performance or analysis of cash flow, and it
enables to track and measure the results over a period of time so that the bank can
determine what has happened at every business stage.

Following are the examples of how banks use analytics to manage the demand
side of the equation:

Personalized Marketing: For a financial institution, the main challenge would be to

manage the demand side of an equation. By focusing on their most profitable
consumers, banks are also able to secure profits from a system that provides them
access to a consumer they may not have had otherwise. In order to ensure that
banks can achieve this, they must know who their most profitable consumers are.

Today banks would make use of a variety of data sources in order to determine who
they must target with the messages and offers of marketing:

Lifetime value prediction: Customer lifetime value refers to a term that is used in
order to describe the amount of money a consumer tends to spend with a bank over
a period of lifetime. This is different from the traditional perspective on brand value,
and this refers to how much a consumer would be willing to spend for a product or
service. In order to ensure that banks and financial institutions to optimize their
models of business, they wish to consider both the measures of customer value.
Traditional analytics tend to focus on the former while the latter ignores, and this can
hugely impact the revenue.

Conclusion: The use of data analytics in banking isn’t new. These banks can
implement data analytics for the last few decades in order to differentiate
themselves, get a competitive edge, and make sure the best, customized services
for their customers. For banking and finance, data analytics is crucial for banking as
it contributes to prediction, prevention and analysis.
2nd Answer
Introduction: The increase in analytics would present a world of almost unlimited
potential for industries such as insurance where the companies have long held a
foundation of information. The industry at large has had a slow adoption of new big
data analytics due to cost concerns, and regulations can be the limited pressure of
the future.
The role this data would play in today’s market would vary by the insurer as each
would weight the cost of improvement upon the system of information versus the
losses that are caused by the current fraud. This often boils down the question of: is
fraud the reason to create a poor enough customer experience that the infrastructure
investments would improve the detection of fraud and improve the honest claims
processed by the consumer.
Concept and Application:
Protection of personal information is very important, but the pattern of fraud
recognition needs huge amount of data through underwriting, claims and other
insurers.
Modelling often would rely on the past behaviours for prediction of the fraud, but the
criminal practices change very quickly to make some of this analysis worthless.
While analysis has been a challenging task to master, today’s insurers have seen
many benefits.
Detection of fraud has improved and systems are now very robust enough to provide
analytics in real-time. Some insurers have gained the ability to scan for fraud before
a policy or a claim is approved.
The future of detection of fraud, however, cannot be a totally pure analytics
approach. The human element in the assessment of risk would remain an important
piece of proper detection. Data can hasten the detection of fraudulent activity and
patterns, but people would always be needed to turn reports into actionable
intelligence.
The role of data and analytics in insurance fraud detection:
Setting the stage of today’s market: The illegal activities that encompass fraud are
first of all a threat to the financial stability to every insurer, but the harm caused is
much more far-reaching.
Fraud detection units and internal auditors usually manage most of the data as well
as the systems used in order to store and process detection of fraud. As automated
processes become much more in-demand, IT has a much bigger role to play within
the unit of fraud.
The availability of real-time services would further the importance of IT in budgets as
well as decision-making. As many units have an intent to grow on scale, the team
members pull double-duty as both IT experts as well as fraud analysts.
The Role of Data and Analytics in Insurance fraud detection:
The what and when of availability of data: Most insurers have a huge repository of
existing data with respect to historic claims and information pertaining to policy and a
steady stream of new claims and data of applications.
Insurers often work with law enforcement to share some information; however EU
laws as well as the nation laws hugely limit what information must be shared among
the insurers.
Much of this data is usually used in order to validate what is being told by the
claimant and what is being processed. Insurers not only look to see the red flags in
terms of conflicts, but they also look for connections to organized crime. Insurers
today look for fraud in new policies, and then ensure that they review the information
when there are changes in the policy.
Touch points causing a review involve coverage shifts by insurers, new claims,
changes by the holder of the policy and during the renewal of policy.

The challenge with some data is that some brokers are not always wanting to give all
the information that the fraud detection units of insurers would like, such as contact
information. Email addresses and phone numbers are important when it comes to
identification of links to fraudulent activity.

Existing Operations and Obstacles: Big data analysis is being driven by the
imperatives of IT, and not mainline operations of business. Analytics is often
introduced on a project basis and if the benefit is shown, then the platforms of
analytics is expanded to more divisions. These techniques may be implemented in
marketing by insurers or other areas of customer service, but the detection units of
frau from the tools and analysis is just as much.
Predict accurate risk for underwriting: Underwriting refers to a complex task for the
insurers, and it can be simplified through the analytics of insurance underwriting. For
instance, the data trend would predict a higher amount of premium for a customer
who has been engaged in rough driving as compared to that of a customer whose
data trend would predict a lesser riskier profile.
The application of advanced analytics in the process of insurance underwriting would
encourage the underwriters to concentrate on tasks that are subjective that would
call for judgment and intuitive decision-making while enabling the systems to handle
back-office work. Data analytics model is also used to develop better rules of
underwriting. This, in turn, would contribute to a uniform application of underwriting
practices and less amount of risk.
Enabling business growth: An important element of the insurance domain is to
ensure that it quantifies the level of risk so that it is in a position to accelerate growth
in business. Until recent times, the calculation of this risk was very intuitive.

However, with so much data available, it can be made possible to base such an
assessment on pure data as compared to a conjecture, and even predict the
eventualities that would disrupt the operations. Accordingly, insurance agencies
often analyse this data and the revenue leakages are plugged that can be eating into
the profits of business. In this way, insurance data would act as an engine to the
growth of insurance companies with its capability in predictive analysis of big data.

Conclusion: The emerging leaders of this insurance sector have been leveraging
the data analytics of insurance while making decisions that concern the pricing
strategy and selection of risk. The new-gen technology works progressively to deploy
prescriptive methods to procure deep insights from the big data in different
transactions pertaining to insurance, such as underwriting, management of claims,
satisfaction of customers, and policy administration to make sure better predictive
analytics.
3rd Answer

3a.

Introduction: The concept of Big Data, IoT and AI have been with us for a while.
The emergence of cloud computing and the fall in the price of data storage have
meant the routine deletion of potentially valuable data has stopped. Instead, there is
a wide consensus on the hidden value in the data, with the storage being an
important pre-requisite to unlock its potential. As such, convenience and retailers
have invested heavily in solutions of data warehouse, and this is capable of storing
huge data volumes.

In the above scenario, the grocery and supermarkets need to ensure that they
implement predictive analytics:

The focus from storing data to extracting value from it has been moving beyond the
reporting as well as the simple solutions of dashboard to AI-driven algorithmic
statistical methods.

Covid-19 has caused many uncertainties, but we are confident that the retailers who
would succeed in the new normal would be the ones that extract value from their
data with the grocery data analytics, and they use it as a source of having
competitive advantage, now and in the future.

Mission profiles form part of an ecosystem with customers, departments, formats,

and stores. Stocking the right products that customers will demand is a fundamental
analytical challenge. Getting it wrong can lead to suboptimal sales growth,
unnecessary waste, poor on-shelf availability, and labor productivity challenges.

Identification of which products a consumer would purchase is one way to use

customer data and it is better not to use this information in isolation. If a consumer
purchases a long-lasting product such as a peanut butter or bathroom cleaner, for
instance, sending them a promotion for that item next week would be useless.
Analytics would make it possible to determine how frequently a consumer can
purchase a particular product, and then offer them a deal for it around the time they
would be wanting to purchase it again.

Loyalty program data is also a good option to used when it comes to identification
when a consumer would turn to a competitor to purchase a particular product. If a
person used to purchase protein every week and they stop, it is a sign that the prices
may be too high or quality of that brand is too low.
The store begins to offer consumer coupons for meat or emailing them when meat is
on sale in an effort to attract them back. It can also take this behaviour as a signal to
look into its products and prices and determine if something has to be changed.

Conclusion: Inventory and marketing are some of the main areas where big data
provides health benefits. Many organizations often collect large amount of data, but
they never make proper use of it. By approaching the supermarket analytics and
having specific goals in minds, one can gain useful insights and find ways to make
business more profitable.

3b.

Introduction: Business intelligence refers to an infrastructure that would enable in

the process of collection, storage and analyses of data from the business operations.
BI provides all-inclusive business metric, in near real-time, to support better decision
making. Performance benchmarks can be created, market trends can be spotted,
and each and every aspect of the business can be improved with a much better
business intelligence.

Concept and Application:

Business analytics: It refers to the process of taking the raw data of company and
turning into useful information, and this includes identification of trends, prediction of
outcomes and more. It involves data mining, aggregation, forecasting, predictive
modelling, data visualization.

Applications of business intelligence in management of supply chain:

Supplier/vendor coordination: In order to satisfy the consumer demand and improve

the cycle of order, there must be better communication between the suppliers as well
as vendors.

Business intelligence in supply chain management would make use of ERP. This
kind of software would tie together various processes in logistics operations and
enables sharing of information amongst them. For instance, all the business data
and workflow are integrated into a single channel that would automate the
communication between various partners of supply chain.

• Other advantages of ERP in business intelligence include:

• Reduction in mismatches in quantities of product.
• Time delivery of products or services.
• Get rid of the challenge of excess stock
• Sheds lights across all the operations of logistics.
Package evaluation: One may have a good product. However, one would want to
optimize the packaging. For one, consumers don’t prefer bulky packaging. Secondly,
dimensional weight impacts cost of shipping. So, one would want to reduce few
inches here and there by making use of right box sizes.

Business intelligence often provides correct weight measurement and dimension for
the supply chain. Ultimately, this may often enable you to cut packaging and costs of
shipping.

Distribution and communication: BI can often narrow down the shipping distribution
up to the level of city. So, distribution is not only limited to moving goods from one
point to another. It includes many things, and this includes management of inventory,
proper packaging, warehousing and logistics. It is an integral aspect of distribution
and impacts how efficiently a supply chain would fulfil the orders of product.
Overseeing the journey of the product from the warehouse to its final destination is
important when it comes to logistics.

Conclusion: Unlike the years in past, transparency in supply chain would attract the
attention of senior-level managers in various companies. The reasons for this
growing interest is clear. Corporations have been facing more intense pressure from
the customer, government and NGOs to reveal further information with respect to
their supply chain.