Efficiency of Process Mining implementation in a bank

Nikolay Sitnikov, Director of Product Development at RAMAX Group, told the business magazine Invest Foresight how Process Mining technology works and why implementation of this technology will be particularly efficient in the banking sector.

The Process Mining technology appeared in late 1990s in the Netherlands, but its application in Russia began only in 2014. In essence, the technology makes it possible to create a model of a company’s business processes based on the information trails left by these processes. In turn, the model allows one to get an insight about the existing problems and the ways to solve them. The main distinguishing feature of the technology fr om BPM systems is that the business model is created automatically rather than manually, without the need to interview the staff members. As a result, the efficiency of the processes increases considerably.

The use of this technology is of vital importance for large corporations where it is impossible to perform a high-quality interview of the entire personnel during a survey. VTB24 bank is the first company to implement Process Mining.

Necessity of Process Mining for VTB Group: the classical approach no longer works

The goal of experts dealing with the optimization of business processes in the bank environment is to improve the quality of service. Each employee should work efficiently and quickly, and the analysis procedure requires a deep immersion into the bank activities. In large companies it is just impossible to monitor the processes as quickly as they are changing, therefore the classical tools, including the interviews, stop working. Acquisition of analytical information in automatic mode is a prerequisite for proper optimization in a modern bank. That is why the Process Mining technology became an ideal solution for VTB Group. One might compare this system with a “smart watch” that counts the pulse and the number of steps, but for an enterprise rather than a person.

Pilot tests of the technology began with VTB24 mass products, that is cash loans and credit cards. It concerned not a simple diagnostics of losses and errors but acquisition of data on rare scenarios and how the situations evolved. The following example can be given. There are about 60 different scenarios in cash loan issuance, but 80% of successful loans account for as little as five base variants. Therefore, it is just impossible to foresee everything in advance. The problem was solved using Process Mining with access to financial reporting in T-1 mode. It means that information about the work of specialists and departments during a day is available as early as next morning.

Implementation of Process Mining in VTB24 and opinions of staff about the technology

The main advantage of Process Mining is that there is no necessity to change the operation of business processes during the implementation. Specialists continue to do their work, while the appropriate subdivision is recording the operations and analyzing the problems. Monitoring panels (dashboards) were created in VRB Group branches to display information about the main parameters and their variations.

According to the employees who deal with business process optimization in VTB24, it was not easy to adopt the new technology. The first dashboard for one of the products was developed only two months after Process Mining usage began. After that, the process accelerated. First of all, loan products were connected to the system, followed by the small businesses department. At the next step, it is planned to connect the operational department to the technology.

Benefits of the new technology: areas of optimization

It became clear during the pilot run of the project that the investments paid off tenfold. Several areas of development appeared during the employment of Process Mining technology: 
  • error control, which implies distant training of employees;
  • enhancement of systems in order to eliminate the error origin.

During the four weeks of Process Mining operation, processing of a request became 4 minutes faster on average, which is a very big achievement for a bank. Over 150 million rubles have been saved to date just in the credit products category, and even better results are planned in the future.

Effect of Process Mining on the life of VTB24 employees

Once Process Mining was implemented, every Monday directors of each sales point tell the bank branch employees during the briefing who achieved the best results. These data are determined using the Process Mining technology. The best efficiency is understood as handling the maximum number of requests, selling the maximum amount of products, and making the minimum number of errors. The list of those who fall behind is also provided by the director, but for a reason, i.e., to analyze the errors. The reasons of falling behind are clear at the level of particular requests since there are a number of strict rules of request handling, including the time for executing a cash loan or a credit card.

The knowledge of the rules and the fact that errors will not remain unnoticed create a competition between the employees and improve the overall work. Furthermore, branches can learn about the achievements of colleagues from other regions and can try to overcome them in the future.

It is important that Process Mining freed VTB Group from subjective estimation and allowed them to identify the stage wh ere errors appear and the error reasons. The technology does not require considerable human resources: just two employees are responsible for it in the bank, including all its branches all over the country! It should also be noted that it is unnecessary to set tasks to the bank’s IT services, since the interface and dashboards are developed directly by the analysts in the form they deem convenient.

Process Mining development options

One should distinguish the Process Mining technology from the platform used as the base for the implementation. The technology itself appeared rather recently, therefore there are rather few platforms that work with it. And there is but one suitable platform suitable for large enterprises. It was developed by Celonis (Germany). It is this platform that is used by many internationally renowned corporations. The Celonis system is continually developing to introduce new options, including automatic comparison of business processes with an existing standard and examination of the diversion reasons.

VRB group also implemented the Celonis platform. It is planned to develop it further in the future since the Celonis quickly reacts to the arising needs of large market players and offers new functions. In VTB24, expansion of Process Mining to all subdivisions will continue in order to reach higher performance. The need for Process Mining grows, hence the use of the system will continue in the future.

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