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Harnessing the power of the Sales and Service - Account Origination ES bundle, banking and financial officers that participate in the account origination process can field customer inquiries, capture and process customer-specific documentation, perform risk assessments, validations, and underwriting, and finally administer loan applications. In addition, after making institutional decisions and presenting offers, they can then create the contracts for the products themselves.

If a contract requires collateral, the application-to-application enterprise services in the Sales and Service - Account Origination ES bundle immediately creates the necessary collateral constellations in SAP Collateral Management. All resulting data is propagated by the Sales and Service - Account Origination ES bundle to SAP Customer Relationship Management.
The Sales and Service - Account Origination ES bundle can accommodate both new and established customers. When a new customer requests a product, the attending relationship manager performs an initial qualifications check. The check includes a credit rating scoring and evaluation, executed via communication with an external rating service.
Once the customer's qualifications have been confirmed, the manager will then proceed to analyze the customer's needs, capture his personal information, and create a new business partner.
The customer's total commitment must also be evaluated. The total commitment displays all existing contracts undertaken by the customer, along with their key attributes, derived from related back-end systems. A financial statement will be calculated as well, followed by an examination of the customer's available collateral, should any be required. Next, based upon results derived from ready-to-run analytic utilities that have taken into consideration all of the previously gathered data, the manager creates a preliminary financial plan. In the last stage of this phase, the institution presents the customer with an initial decision.
The subsequent phase involves calculating and creating customer-specific offers. To do so, the relationship manager must ascertain the customer's specific needs. He may require a simple loan for furniture. On the other hand, he may need a mortgage loan along with a credit line and an insurance plan. In either case, the manager executes the searches necessary for determining the conditions and prices associated with the requested product or bundle of products, as well as the payment plans for each.
Once the customer has selected a specific package offer, the underwriting, risk assessment, and validation processes can be initiated. Again, all of the data gathered to this point is assessed on the back end using a series of computational services. Depending on the resulting calculations, the institution can confirm its initial decision, or, if the customer is not qualified for the requested package, it can present him with an alternative. When at last both institution and client have made a final decision, the loan contract (or contracts) can be created and signed.

Sales and Service - Account Origination (click to enlarge)


In the last stage of the origination process, the application-to-application services in the Sales and Service - Account Origination ES bundle execute the creation of any required collateral constellations (limited to real estate collateral only in the present release of this ES bundle) and then propagate all pertinent data to those systems whose functionality depends on it, such as SAP Collateral Management.

Since the processes and utilities in the Sales and Service - Account Origination ES bundle are both seamlessly integrated and structurally consolidated, when all is said and done, officers can rest assured that their work is securely incorporated and accountable at any given juncture in the origination pipeline.

Implementing the Sales and Service - Account Origination ES bundle allows banks and financial institutions to:

  • Employ a single, web-based user interface to initiate, establish, supervise, and maintain all phases of the origination process
  • Reduce the length of the origination process and the amount of paper output
  • Improve decisions using ready-to-run analytic utilities
  • Increase customer satisfaction by providing faster product launch and 360-degree visibility across the origination landscape

The Sales and Service - Account Origination ES bundle leverages enterprise SOA by enabling service-based communications between SAP CRM, SAP Loans Management, and SAP Collateral Management. It also leverages enterprise SOA by providing service-based communication with third-party systems such as credit-rating bureaus.

Audience

The Sales and Service - Account Origination ES bundle can be deployed in any scenario involving the origination of loan contracts. Because the solution features a customer-oriented design and delivers end-to-end process integration, the majority of banking and financial institutions that deploy it will increase their flexibility, extend their visibility, and deepen their collaborative ability. Surpassing rudimentary front-office analytics, the bundle's out-of-the-box functionality provides data transparency across the enterprise, and hence a true 360-degree view of the customer's behavior and needs.

The enterprise services in the Sales and Service - Account Origination ES bundle are available to users across the process architecture, from relationship managers and advisers in the front office to risk officers in the middle and vice presidents in the back. While tasks are executed through a single, web-based user interface on the front end, the workflow is processed across multiple applications on the back end.

These services tighten product parameters. As such, it is possible to offer customers several variants of a given product. Decision-making will also be enhanced, so process efficiency will boost while operational costs decrease. Of course another result that using institutions will experience is a surge in their overall return-on-investment. The ultimate benefit, however, will be reflected over the long run in the dedicated loyalty that always results from the highest levels of customer satisfaction.

For details on Service Operations, Business Objects and Process Components, please check the ES Workplace.


How to Use This ES Bundle

The early developments of account origination services were hard-coded into the back-end system and not available to customer-facing managers. Until SAP released the Sales and Service - Account Origination ES bundle, the process was typically driven by hard copy records that were printed from a computer. After customers interested in acquiring a loan, insurance policy, or checking account had completed an introductory questionnaire, an attending relationship manager would use it to begin the formal application process. This method was repeated from department to department until slowly but surely the customer was granted a loan and his monies dispersed. Since cross-department interactions were limited, so too was the institution's collaborative ability. Since in general there was no central means of viewing customer records and activities, visibility was critically restricted. And since the process of performing tasks manually was both time-consuming and energy inefficient, providing few means of dynamically adjusting processes within and across institutions, they had little or no flexibility.

The increasing scope and deepening complexity of today's account origination process confronts banking and financial industries with a challenge whose solution can no longer tolerate such static, inflexible, and disconnected procedures. Current strategy requires extreme flexibility, far-reaching visibility, and effortless collaborative ability. Moreover, to achieve success and maintain leadership in a financial services industry characterized by a rapidly mounting struggle to win consumer confidence and loyalty, it is imperative that solutions at each phase of the origination process demonstrate people-centric design. In short, the customer's every need must have a corresponding solution, however large or small, simple or complex, and every solution must be accessible for review and modification from any viewpoint in the origination landscape.

The services included in the Sales and Service - Account Origination ES bundle provide its users with the functionality necessary to meet all of the aforementioned ends. It furnishes both a seamless integration of processes and a structured consolidation of utilities designed to address each stage of the origination life cycle with confidence and ease.

First, to access and control information regarding customers, products, prices, conditions, business partners, and sales, officers command a single, web-based user interface that is firmly connected to core financial service applications on the back end. Business partners, for example, along with all their pertinent attributes, are synchronized and mapped from SAP CRM 5.0 to these back-end systems.

On the whole, too, processes are automated and customer information is handily available in all channels. As such, the efficiency with which managers can execute and process customer requests, business partner scorings, and credit rating inquiries from external agencies including Experian, Dun & Bradstreet, and Schufa is vastly increased. Ready-to-run analytical capabilities such as the Client Portfolio Miner packaged solution are also deployable, and these greatly simplify tasks involving underwriting, risk assessment, and validation. Yet another notable feature in the Sales and Service - Account Origination ES bundle is its total commitment functionality, which displays all existing facilities contracted by a given customer, including key attributes, derived from back-end systems.

The Sales and Service - Account Origination ES bundle further includes capabilities to create product bundles and establish a business rule framework. A product bundle represents a set of independent products that are sold together, under a special name within a contract. Product bundles can contain such products as a loans, credit cards, and insurance. A business rule framework, on the other hand, supports the origination process by tightening plausibility and consistency checks, assessing product and product bundle dependencies, and determining default values. Such a framework can also ensure status control, workflow integration, and the commencement of actions. For instance, if a customer wishes to purchase a product bundle that includes two credit cards, the request is checked against an established rule framework to determine whether the request fits the product bundle component definition for which the customer is eligible. Since the request check is synchronous, the manager receives her answer in real time, either authorizing the additional credit card or declining it.

The origination process is complex. Customer needs and objects must be ascertained, qualifications and rates assessed, products and bundles defined and chosen. Collateral must be requested and presented, eligibilities confirmed, attributes, conditions, limits, and payment plans established, and offers finally presented. It is only after the satisfactory completion of these processes that the relationship manager can trigger the creation of a contract.

Even now, however, the origination process has yet to be concluded. Once a contract has been signed and created, the services in the Sales and Service - Account Origination ES bundle continue to work in SAP CRM. For example, the vast majority of loans must undergo collateralization, the process of verifying and, if necessary, adjusting the collateral status of a contract between a bank or financial institution and the customer to whom they have granted a loan. Traditional collateral assumes the form of assets, such as real estate and other chattel, and is provided by the customer to whom the loan is granted as a security or guarantee against the risks assumed by a bank or financial institution should the customer fail to meet his contractual obligations.

In any event, the functionality in this ES bundle dovetails with other ES bundles such as Current Account Management - Business Operations, which, taken together, provide for the establishment, supervision, and maintenance of collateral constellations that are integral to live contracts. When the role contract officer of a bank creates a new loan contract that requires collateral, the data for the new contract and its associated collateral constellations is automatically propagated to SAP Collateral Management and other relevant back-end systems.

Other features included in the Sales and Service - Account Origination ES bundle are predefined portal roles, campaign management functionalities, and lead and opportunity management functionalities. Also available are diagnostics for opportunity pipeline reporting and customer behavior analysis.

This section will explore a series of use cases for the Sales and Service - Account Origination ES bundle. Each use case will show how different outcomes can be achieved by using the enterprise services in different combinations. While these examples illustrate a few of the ways that this ES bundle could be used, the intention is to show the flexibility and reusability of these business objects and enterprise service operations so that you will have a clearer understanding of how to best deploy them in your own environment. This wiki is also a space for you to share knowledge and collaborate with others who are implementing the Sales and Service - Account Origination ES bundle.

Use Case 1: Basic Consumer Loan Origination

A newlywed couple wants a loan to purchase a new bedroom set. They have never done business with the bank they have just approached, so the attending relationship manager must perform an initial qualifications check. The Sales and Service - Account Origination ES bundle includes a single user interface that is ready out-of-the-box to execute tasks related to any phase of the origination process, including qualifications checks. The check includes a credit rating scoring and evaluation, executed via the bundle's A2X communication with an external rating service such as Experian, Dun & Bradstreet, or Schufa.

Once the customer's needs have been stated and qualifications confirmed, the manager then proceeds to capture the signee's personal information and create the new business partner under which the loan contract will be created. Establishing a business partner is simply a matter of entering the customer's name, address, phone number, social security number, birth date, and other such key data into the system (see the FS Business Partner Maintenance ES bundle for details on the enterprise services involved in this process). All data related to the business partner is now stored in the back end. When data such as that from a new loan quotation is added to it, the Create Loan Contract enterprise service will automatically propagate it to all related systems.

The manager now clicks the Acquisitions and Sales tab, and then the New button. By default, the General Information page of a new financial service quotation is displayed. A series of other pertinent of tabs are available for use as well, including the Dates, Prices, Item Relationships, Partner, Scheduled Actions, and Status tabs.

Upon entering the name of the newly created business partner in the Sold-to-Party field, the manager can then select the type of asset the customer intends to purchase. Thereafter, she clicks the Add Entry button at the top of the Product box, which opens a pop-up window displaying a list of products and their relevant descriptions. Once the desired product has been selected, in this case, Consumer Loan, the manager can begin to enter the quotation's remaining details. On the Dates and Conditions tab, the contract start and end date is inserted, along with its duration, predetermined conditions, and financing requirements. These include the loan's premium, interest, and one-time fee. When the loan amount and its interest rate are entered, the Calculate Loan service operation automatically computes the cost of the one-time fee and displays it in the appropriate field.

On the Loan Details tab there are fields to specify what the loan is being used for, which account the customers want to associate with the loan, and the method by which they intend to repay it. Further information regarding the customers' income, assets, expenses, liabilities, and guarantees is needed as well, so the manager clicks the Cust. Assets tab and enters the relevant numbers.

At this point, the manager is ready to review the payment structure and schedule with the couple, all of which information is accessible on the Payment Structure tab. Since most of the processes in the Sales and Service - Account Origination ES bundle are automated, the manager needs only click the Calculate Payments button to trigger the bundle's Calculate Loan service operation, which then uses all the previously entered data to perform the necessary computations in CRM and immediately display the results in the appropriate fields of the manager's UI. These include the amounts to be repaid and the dates on which the payments are to be made. Also included is the interest value as it changes over time and the following period's remaining balance.

The quotation is now complete. To release it, the manager clicks the Status tab at the top of the page, and then the Save button to trigger the Create Loan Contract service operation. Although the manager's work is over, the services in the Sales and Service - Account Origination ES bundle are still at work. For instance, so that the audit team at the store from which the couple intends to purchase their furniture can see the basis for their loan, a creditworthiness check automatically returns a score. This in turn triggers the Calculate Loan service operation, which then generates another number and updates the couple's business partner.

The final phase of this use case involves the approval process, which also happens in SAP CRM based on business rules. The loan could be declined. Alternatively, it could go into a pending phase, in which case a workflow would be automatically generated for review by another officer in the bank. Here, though, the loan is approved and the contract, saved as a .pdf file in Adobe Reader, is printed in preparation for signing. When the manager clicks the Signed button on her UI, the Create Loan Contract service operation is triggered. The business partner is updated yet again, thus completing the process. The bank can now dispense the couple's funds.

Use Case 2: Basic Consumer Loan Origination with Residual Debt Insurance

All of the steps in this use case repeat those described in the previous one. Here, however, the bank from which the customer is requesting his loan is the same bank that granted his first. Consequently, the process will include a number of services in the Account Origination ES bundle that have not yet been addressed.
The relationship manager attending to this customer enters his name and account number by way of executing a search for an existing business partner using a service from FS Business Partner Maintenance. The connection of these services with the Account Origination ES bundle handles those circumstances requiring additional or various combinations of information to locate the business partner with equal flexibility.

Since the customer applying for the loan already has outstanding debt with the bank, the manager must perform a total commitment evaluation as part of the customer's qualifications check. The total commitment displays all existing contracts undertaken by the customer, along with its key attributes, derived from related back-end systems. The commitment check also calculates a financial statement, followed by an examination of the customer's available collateral, should any be required.

Another component that is vital to the qualifications check is the Account Origination ES bundle's business rule framework. This functionality supports the origination process by tightening plausibility and consistency checks, assessing product and product bundle dependencies, and determining default values. The framework also ensures status control, workflow integration, and the commencement of actions.

The results of a qualifications check frequently determine the exact nature of the products that will or will not be included in the manager's preliminary financial plan and initial offer. In this case, the applying customer will not be required to present any collateral. What he will be required to purchase is a product bundle that includes a residual debt insurance policy. A product bundle simply represents a set of independent products that are sold together, under a special name within a contract.

Instead of clicking the Product folder in the Product List column, the manager clicks the Product Bundle folder to activate the pop-up window that displays a list of products and their relevant descriptions. In the pop-up window, she then selects the folder named "Consumer Loan with RDI," whereupon the Create Residual Debt Insurance Contract service operation is triggered.

After she has entered data similar to that which she entered in the earlier use case, the manager arrives at a point in the process that requires her to maintain the insurance policy's details. To do this, she clicks the Insurance Details tab and then selects those check boxes beside the options that the qualifications check has required the customer to purchase in order to receive his loan. The choices here are Loss of Job, Work Incapacity, and Death. Also included on this page are options related to the frequency and method of payment. Returning to the Dates and Conditions tab, the manager clicks the Update Prices button to trigger the Calculate Loan service operation. Now that more options have been added to the policy, its premium has risen.

From this point on, the manager can proceed to enter the FS quotation's remaining details, and then complete the application's signing and approval just as she did in the preceding use case.

Use Case 3: Basic Mortgage Loan Origination

The newlywed couple that took out a loan for furniture in the first use case have returned to the bank to apply for a mortgage loan.

This time around, the relationship manager attending to the couple need only enter their name or account number to search for the business partner they have already established. When she is ready to perform the qualifications check, however, not only has the manager requested that the couple provide current personal documentation such as statements proving their income and fiscal solubility, but also she has requested that they supply her with the draft purchase contract for the house they intend to buy, along with such relevant data as its description, address, size, and price.

In this instance, too, since the loan the couple is requesting is considerably larger, its requirements are greater and more complex. For example, the credit rating the couple received during the evaluation process was not as good as they would have preferred. Taken in concert with the balance remaining on their first loan, the Account Origination ES bundle uses SAP CRM's business rule framework which has determined that they are of a moderate risk and thus require them to purchase residual debt insurance, as well as to provide a significant form of collateral.

Traditional collateral assumes the form of assets, such as real estate, and is provided by the customer to whom the loan is granted as a security or guarantee against the risks assumed by a bank or financial institution should the customer fail to meet his contractual obligations. For those customers with confirmed collateral, the manager would trigger the Find Collateral Agreement by Party service operation in order to preview an updated overview. Here, though, the couple has no significant collateral of their own, so that service is unnecessary. The husband's parents have agreed to cosign the loan and provide the required collateral, in this case, their house, which they own outright.

The main differences between this use case and the preceding ones appear at this point. In the pop-up window for product selections, the manager selects the folder named "Mortgage Loan with RDI," whereupon the Create Residual Debt Insurance Contract service operation is triggered. Also as before, the manager clicks the Insurance Details tab and then selects those check boxes beside the options that the qualifications check has required the couple to purchase. On the Dates and Conditions tab, the manager clicks the Update Prices button to trigger the Calculate Loan service operation. Once again, with more options have been added to the policy, its premium has risen.

To initiate the collateralization process, the manager also clicks the Objects tab and enters all the data pertinent to the couple's intended home, as well as all of the information pertaining the home that the husband's parents have offered as collateral. Account Origination functionality dovetails with other ES bundles such as Current Account Management - Business Operations and FS Business Partner Maintenance. As a whole, these services provide for the establishment, supervision, and maintenance of collateral constellations that are integral to live contracts. When the relationship manager updates the system using the Maintain Collateral Constellation service operation, the A2A services in the Account Origination ES bundle generate the contract's collateral constellations and then propagate all pertinent data to those systems whose functionality depends on it.

Future Directions

The Account Origination bundle can be used in any number of financial product scenarios and is not limited solely to loans. As the name account origination suggests, this bundle can be used for multiple "account-based" financial products including, but not limited to:

  • Current accounts (known as checking accounts in the US market)
  • Savings accounts
  • Savings plans
  • Credit cards
  • Insurance products
  • Installment loans

Connectivity

The Account Origination ES bundle connects to SAP ERP, SAP Collateral Management, and SAP CRM using SAP NetWeaver Process Integration (formerly XI). Because of the standards-based communication offered by enterprise services, the ES bundle can be easily integrated with credit rating systems using XML message-based communication. This means that the bundle can communicate with almost any other XML-based subsystem. For example, the bundle can communicate directly with ratings organizations like Dunn & Bradstreet and Experian. The results of these external queries are used in the final calculations in the ERP Credit Server creating a single value indicating the credit-worthiness of that business partner.

System Requirements

Related ES Bundles