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Pershing upgrades its customer data analysis for the 21st century

To improve its customer data analysis, financial services firm Pershing integrated BI technology with its investment trading platform.

When Pershing LLC began providing its clients with electronic rather than paper-based customer data reports in...

the 1970s, the Jersey City, N.J.-based financial services firm was on the cutting edge of IT.

More than three decades later, however, Pershing was still making do with some of the same static, row-based reports. Its customer data-related business intelligence (BI) capabilities were seriously lacking, according to Tony Berman, vice president of information delivery and eAnalytics at Pershing.

Founded in 1939, Pershing provides financial services like stock trading and fund transfers for its 1,100 clients, mostly investment banks and broker-dealers which themselves invest in the stock market and other venues on behalf of their own customers. In the process of doing business, Pershing collects reams of data on approximately 5 million customer accounts, which include pension funds and individual investors.

Until 2003, Pershing passed on this customer data to its clients with daily, static reports. The reports helped Pershing's clients -- which include T. Rowe Price, Bulltick LLC and BancWest Corp. -- better understand individual customer accounts, but they lacked any modern BI capabilities, like ad hoc querying or interactive dashboarding.

If a Pershing client wanted to do more advanced customer data analysis, such as location analysis or trend profiling, it had few options other than to manually type data from Pershing's static reports into one of its own databases or data warehouses, then do the analysis itself, Berman said.

"We were always getting requests from our customers for more [data analysis capabilities]," he said. "They were looking for more flexible ways to look at their customers and their behavior."

To that end, in 2002, Pershing put out an RFP for a BI product that could integrate with its financial trading platform, called NetExchange Pro, to allow clients to manipulate their customer data and conduct more advanced analysis. After evaluating a number of vendors, Berman and his team chose Information Builder's WebFOCUS BI platform for the job.

"WebFOCUS had a pretty unique ability at that time to allow us to integrate BI into the NetExchange Pro platform that our clients were already using," Berman said. WebFOCUS also proved adept at scaling to Pershing's 100,000+ NetExchange users, and the tools provided the flexible reporting and charting capabilities that Berman was after, he said.

Pershing implemented WebFOCUS on a UNIX platform in mid-2003, giving its clients access to customers' account data in the form of structured, ad hoc reports with tabular results, interactive dashboards and static scorecards. The tools are "100% self-service," Berman said, meaning that clients can do all forms of analysis from a single portal without the help of Pershing or internal IT departments.

Among the most popular type of customer data analysis is what Berman calls prospect analysis. "Imagine, for instance, you're a broker and you might hear a news report about Coca-Cola or General Motors, for that matter, you might want to find all your customers that hold that security [or] who maybe have done trades with them in the last few months," Berman said. "So we provide flexible reports to help the brokers find prospects within their existing customer base."

Some of Pershing's larger clients use the WebFOCUS tools for customer location analysis, he said. "Their customer addresses are of course in our databases, so [our clients] can see where they might want to add some brokers or add an office based on where they have gaps."

Other clients filter customer data by age and account type, like retirement or money market accounts, among other parameters. And Pershing helps put its clients' customer data analysis in context by comparing their results against industry-wide and individual market segments, Berman said.

Pershing is currently working on adding new customer data analysis functionality using WebFOCUS for its clients, including data mining models to predict customer behavior and the ability to identify customer cross-sell opportunities, though Berman declined to give further details.

All told, in just five short years, Pershing has developed from virtually nothing a broad set of complex BI capabilities for customer data. Its clients now have the tools to better understand their customer accounts, essential information in an ever-changing and increasingly perilous economic environment. And maybe most important of all, those static customer data reports of the 1970s have been relegated to the past, where they belong.

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