When we decided to take on Customer Profitability, and we do mean "take on", we knew that we had better come ready to shoot for bear because Customer Profitability is truly the biggest "big game" still roaming the woods and thickets of the financial institution industry…terrorizing and chasing law-abiding CFOs from their board rooms all around the country.

Profitability Committee
Before we began our hunt, we assembled a group of our current users and held a series of profitability meetings over an 18 month period. During these meetings we laid out a plan of attack and poked holes in that plan until we all felt we had a truly unique, easy-to-use, Profitability and What-If-Pricing tool that could take down any profitability "big game" that came our way.

360 View Profitability
Our 360 View Customer Profitability software module will allow you to track your account and customer profitability by pulling fee and transaction bucket information from your core system into our software where you can then perform cost allocation, loss provisions, and FTP Pricing to determine account, product, customer, and household profitability while using transparent calculations that any user can see and follow. We don't have to tell you that a profitability system is only as good as a user's belief and trust in the calculations.

360 View What-If-Pricing
Finally, like a sniper's scope, we added a What-If-Pricing tool that will allow you to price your core application products in What-If scenarios to determine the actual pricing of any one product, so you will see what is needed to move the entire customer relationship to a return that will meet your optimum yield. You can even save your What-If scenarios as proof of your pricing or in order to share with others in making your final pricing determination.

Parting Thoughts
Now that we are back from the hunt and our trophy on display for all to see, we have a few tips to share with anyone just starting out in this pursuit. Throughout all our meetings and conversations with community banks and credit unions, we found a few common thoughts, necessities if you will, on the best strategy to take down this "big game" called customer profitability. We have shared these with you below. Our 360 View system, of course, utilizes them all.

• Must utilize FTP or Funds Transfer Pricing to be accurate
• Must allow for Loss Provision
• Must allow for Cost Allocation
• Must take into consideration the customer entire relationship
• And, most important of all, the calculation must be transparent if users are to accept the result and adopt this technology

Watch Our Profitability Webinar Now
This webinar discusses the best practices in determining Customer Profitability. It includes demonstrations of the 360 View Profitability system to highlight how What-If-Pricing, Funds Transfer Pricing, Loss Provisions, Cost Allocation, and Relationship Householding all play a part in getting the best measure of Customer and Account level profitability.
[watch webinar]