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e-Business Transformation in the Banking Industry: the Case of Citibank  
Product Ref: 15/560C Company: Citibank

Product Type: Case Industry: Banks & Diversified Financials

Related Product(s): Teaching Note
Citibank reshaped its e-business program after the financial crisis of 2008, focusing on leveraging its geographical reach, rolling out global initiatives to maintain its leadership in treasury and trade services, and becoming even more customer-centric. Citibank restructured its R&D centers and its marketing strategy to assist customers in finding solutions rather than selling products.

Citibankˇ¦s execution was fast-paced, but the landscape for treasury and trade services was changing rapidly after the financial crisis. Multi-banking became a must and a new solution marketed by SWIFT allowed multi-banking on the internet at low cost and with greater efficiency than previous solutions. While adoption was slow, the change in the competitive landscape was significant. The data of any bank could now be seen and manipulated through the internet portal of any other bank.

Internet portals continued to evolve offering new features and functionalities at the product level: Citibank updated its CitiDirect BE and TreasuryVision platforms to offer what the market asked for. But seamless bank-corporate integration at the technology level was not evolving at the same pace. Corporation and bank data exchanges were inefficient, making a number of treasury tasks labor-intensive. Corporations came to prefer multi-banking platforms after the financial crisis, and were demanding automated integration of bank data into their ERPs.

An e-business transformation was on the way. Internet banking portals became multi-banking portals, as did proprietary bank-corporate EDI links like CitiConnect. But it was cloud computing that promised the definitive technological solution for the bank-corporate integration model. The ERP vendor SAP was the first to experiment with a private cloud model and allow direct straight-through processing of each financial transaction sent from the ERP directly to bank middleware. Citibank was the first bank to sign up the project, but its competitors followed. Digitalization of bank services was reaching the next level, and this promised to have significant impact on the banking business model.
Functional Area : Strategy & General Management

Learning Objective: - Evolution of the relationship between major financial institutions and major MNCs driven by technological change: the evolution of the strategic landscape
- Viable business models for banks and fundamental competitive drivers once a new integration model creates a significant e-business transformation, as in the case of cloud computing
Length: 19 pages Country: United States of America

Pub. Year: 2015 Level of Difficulty: 3
This product type is available in the following language(s):      English
Related Information: N/A
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