1PKC Advisory

Advanced Analytics

2PKC Advisory

Overview

3PKC Advisory

PKC Advisory – Differentiated Value Proposition

Incepted in Kuwait and focused on the MENA region, we offer a breadth of

regional experience. We have executed 700+ assignments for 100+

clients in the region

Regional

Experience

Having worked with numerous clients across sectors, we offer a depth of

operational expertise. Our long term engagement model ensures that we

are part of client teams and support them in implementation and execution

Deep Operational

Expertise

Our advisory services are focused on helping clients make informed

decisions and perform better through people, process and

procurement related improvements. We also provide innovative solutions

with our alliance partners

Complementary

Service Offerings

Our service offerings and deliverables are tailor made to meet the specific

needs of individual clients. We work collaboratively and enhance client

capabilities through effective knowledge transfer

Customized

Approach

Our robust governance, standardized procedures and control mechanisms

lead to increased efficiency and ensure delivery of the highest quality

with utmost speed to our clients

Robust Governance

& Controls

Our unique onsite-offsite model, allows us to hire the best talent from

globally recognized institutions and organizations, offer offsite execution

prowess and pass on the cost arbitrage and productivity gains to our clients

Competitive

Positioning

4PKC Advisory

Advanced Analytics Service Offerings

5PKC Advisory

Advanced Analytics Service Offerings

Advanced Analytics has gained prominence as a key instrument to explore new business opportunities, drive efficiency and to

support faster & better decision making across functions. It amalgamates sophisticated statistical techniques, business concepts

and technology tools to predict events and behaviors in order to drive sustainable competitive advantage for an organization.

Our wide spectrum of Advanced Analytics Solutions across Customer, Social Media, Operations and Risk enable our clients to

uncover hidden patterns & correlations and take data driven decisions.

▪ Core Model

Development

▪ Model Validation

▪ Model Monitoring

▪ Model Risk

Governance &

Framework

Development

Credit Risk &

Regulatory

Analytics

▪ Customer

Identification &

Acquisition

▪ Customer Growth &

Retention

▪ Customer Value

Enhancement &

Engagement

▪ Measurement &

Analysis

Customer

Analytics

▪ Customer Digital life

cycle

▪ Campaign

Designing

▪ ROI Optimization

Web & Social Media

Analytics

▪ Optimization

Analysis

▪ Root Cause

Analysis

▪ Forecasting –

Loss/Demand/

Supply

▪ Data Analytics and

Deep Dive

Operational

Analytics

6PKC Advisory

Customer Analytics

Customer analytics generates valuable insights pertaining to Customers, Products & Distribution Channels and helps the

organization direct their efforts in maximizing revenue & enhancing profitability. PKC Advisory offers bespoke and in-depth

analysis across customer life cycle driving higher customer acquisition & wallet share, low churn and thereby significantly

enhancing customer life time value.

▪ Customer Targeting &

Segmentation

▪ Product Recommendations

▪ Customer Campaigns

▪ Cross-Sell & Up-Sell Models

▪ Customer Churn Models

▪ Channel Performance Analysis

▪ Customer Behavior Analysis

▪ KPI Identification &

Dashboard Creation

▪ Conversion and Response

Rate Enhancement

▪ Customer Satisfaction

Analysis

▪ Net Promoter Score (NPS)

▪ Customer Engagement

Programs

Customer Identification & Acquisition

Measurement & Analysis

Measurement & Analysis

Strong Branding and Customer Loyalty

Updated Information on Customer Behavior

Services Offerings Benefits

Customer Growth & Retention

Higher Growth in New Customers across

portfolios

Decreased Customer Attrition

Increased Wallet Share

7PKC Advisory

Web & Social Media Analytics

The fast paced adoption of various digital platforms by both organizations and customers has resulted in the need to study

customer digital footprints and social media behavior to grow & retain customers and increase brand awareness. PKC Advisory

helps its clients in their Digital Marketing efforts by understanding the web & social media data with visit path analysis, visitor

behavioral analysis, design and tracking of digital campaigns to increase customer base at low costs.

Data Gathering

Customer Behavior

Segmentation

Gathering customer level data – digital (Social Media)

and offline data (Client’s data)

Study customer behavior, payment, preference and

purchase pattern

Undertaking customer segmentation to maximize ROI of

campaign

Campaign Design

Campaign

Optimization

Tracking

Design campaign as per the customer segments and

preferences

Studying campaigns through Design of Experiments

(DOE) and selecting the best campaign on basis of ROI

Identifying KPI and tracking customer behavior and ROI

Approach Benefits

Higher ROI per

Campaign

Higher

Customer

Engagement

Increased

Customer

Acquisition

Brand

Awareness

ROI and Conversion Rate OptimizationCampaign Designing Customer Digital life Cycle

▪ Customers Digital Visit Analysis

▪ Visitor Behaviour Analysis

▪ Campaign Design as per Customer

Segments and Targets

▪ Digital Ads Design as per Customer

Preferences

▪ Optimizing Campaigns to maximize ROI

on each Campaign

▪ Increase Hit / Conversion rate

Service Offerings

8PKC Advisory

Operational Analytics

Advanced Operations Analytics can help in solving problems pertaining to optimization of distribution network and offer solutions

for sales prediction, simulation and comparison. PKC Advisory assists its clients to process and convert data into useful analysis

and models through Advanced Analytics tools & technologies and bring out actionable insights across the value chain.

Service Offerings Benefits

Higher Profits by

Targeting Key

Pain Areas

Better Decision

Making

Early Prediction

of Future Demand

and Supply

Competitive

Advantage in

Market

Higher Customer

Satisfaction through

Root Cause Analysis (e.g. TAT, Complaints etc.)

Analytical

Approach

Objective

Setting

Data

Gathering Analyses Insights Action Plan

▪ Future Profit & Loss

forecasting

▪ Demand and Supply

Forecasting

▪ Data Gathering and

Transformation

▪ Deep dive and Actionable

insights on operations

▪ Utilization Analysis of

existing resources

▪ Cross Channel Cost and

Sales Practice Analysis

▪ Data driven Root Cause

Analysis on business

problems

▪ Findings solutions and

developing action plan

Optimization Analysis Root Cause Analysis

Forecasting Data Analytics and

Deep Dive

9PKC Advisory

Credit Risk and Regulatory Analytics

PKC Advisory assists its clients in developing customized and robust Credit Risk Models for Acquisition, Accounts Management

and Collection and Regulatory Models including PD, LGD & EAD Models. We also assists in Calibrations, Monitoring, Validation

and Annual reviews of existing and new models specific to each Client‘s internal policies & procedures in-line with industry best

practices & regulatory requirements.

▪ Acquisition/Applications

Scorecards

▪ Behavior/Accounts

Management Scorecards

▪ Collections & Fraud Models

▪ IFRS 9/CECL Development

▪ PD, LGD & EAD Models

▪ Insurance Fraud Claim

Analysis

Core Model

Development

Model

Validation

Model

Monitoring &

Annual Reviews

Model Risk

Governance

▪ Out of Time/ Out of Sample

Validations

▪ K fold Cross-

Validation/Bootstrapping

▪ Back Testing

▪ Documentation and

Submission

▪ Quarterly Model Monitoring

▪ Monthly Data Risk/ Early

Warning Indicators reports

▪ Annual Reviews of Models

▪ Analysis on Model

Performance

▪ Governance Program

Development

▪ Process Design as per

Governance rules

▪ Risk Ranking of Models

▪ Development, Validation &

Execution of Governance

Framework

Approach

▪ Data Mapping

▪ Variable Selection

▪ Model Development

Development

▪ Generating insights

▪ Findings areas of

improvement

▪ Recommendations

▪ Quarterly Model review

▪ Performance tracking

▪ Governance submission

Validation

▪ Cross Validation

▪ Model Comparison

▪ Calibration

Monitoring & Annual

Reviews

Insights &

Recommendations

Service Offerings

10PKC Advisory

Case Studies

11PKC Advisory

Case Studies – Customer Analytics

Behavior & Lifestyle Data

Demographic Data

Cross Product

Previous

Response Data

Final Model Development Dataset

Predictive Modeling : Target Variable Response Rate

(1= Responded Positively , 0 = No response)

Predictive Modeling for Cross Sell Campaign

Model Performance & Results

Model Implementation & Campaign Design

SegmentsScore

Range

Response

RateResponder Total

%

Response% Total Strategy Contact Strategy

1 > 2 % 6.80% 2400 30,000 8.0% 30% PriorityTele Call, Mail,

Email, Mobile

2 1 % - 2 % 1.30% 1250 40,000 3.1% 40% Cross-SellEmail & Mobile

Only

3 < 1 % 0.40% 350 30,000 1.2% 30%Do Not Cross

SellDo not Contact

Total 4000 100,000 4.0% 100%

Cross Sell Modeling

0

20

40

60

80

100

1 2 3 4 5 6 7 8 9 10C

um

ula

tiv

e %

Resp

on

ders

Deciles

Lift Charts

% Cum Responders Baseline

Our Client

A Retail Hub selling products through stores and online channels

The Business Situation

The Client wanted to improve cross-sell to existing customers.

They were already running direct marketing campaigns but the

incremental gains observed were marginal. They required PKC

Advisory’s assistance to improve the effectiveness and efficiency

of the campaign.

Our Role

PKC Advisory undertook a predictive modeling to identify existing

customers who have high propensity to purchase another

product, determine the next best product and preferred channel of

contacting. The analysis covered:

▪ Customer Segmentation on basis of previous response rate of

campaigns, needs, transactional and behavioral data

▪ Development of propensity models based on logistic

regression to cross-sell products and determine the target

segment. This narrowed the number of customers contacted,

thereby reducing the campaign costs and increasing

conversion rates

▪ Ascertained cross-sell propensity to purchase across product

category and targeted only those account with highest

propensity to respond

The Value We Added

Using Predictive analytics, the Client was able to deliver right

product and services at right time. Cross-sell response rate

increased to 8% with reduced campaign cost and increased

customer wallet share.

12PKC Advisory

Case Studies – Customer Analytics

Hig

h P

rob

ab

ilit

y to

Ch

urn

Med

ium

to

Lo

w

Pro

bab

ilit

y

Model ROC Curve Threshold Plot for LR

Churn Probability of Existing Customers

Churn Model on Existing Customers

Our Client

A MENA focused Telecom Company

The Business Situation

The Client was experiencing high churn under different plans for

last one year and required analytics to enhance customer

retention.

Our Role

PKC Advisory developed a detailed model to identify customers

who are at high risk to churn and recommended proactive

measures to retain them. Our approach included:

▪ Analyzing 6 months of customer churn data including

customer demographics datasets, package details, transaction

history, customer satisfaction score, customer activity etc.

▪ Creation of additional variables like number of complaints in

last 6 months, data plan changes and study of behavioral

details like decrease in usage, removal of value added

services, delayed payments etc. to study additional effects

▪ Building logistic regression predictive model to score

customers on the probability to churn from business

▪ Creation of customer segments on basis of churn score for

better customer targeting and retention

The Value We Added

The predicted models helped the Client retain customers and

Identify the key factors for churn and helped develop a retention

strategy. e.g. Customers with high churn probability were offered

attractive bundles, internet data & call offers, free subscription of

entertainment packages etc.

Ascertaining Churn Probability to develop proactive

measures to enhance Customer Retention

13PKC Advisory

Case Studies – Web & Social Media Analytics

Customer Online Data

Analysis

Campaign Design (DOE)

Launching Campaign on Social

Media

Optimizing Campaigns

Tracking Conversion

Rate

Web Analytics Dashboard – Campaign Tracking

Our Client

A GCC focused large Media house

The Business Situation

The Client wanted to identify and acquire new subscription

customers for online live streaming of cricket matches through

digital campaigns across Facebook, Instagram and Google.

Our Role

PKC Advisory undertook analysis of existing customer data

including their preferences, age groups, online behavior etc..

Basis the analysis, multiple digital campaigns across segments

were designed and implemented, which were tracked and

reported using a dashboard. Analysis covered:

▪ Understanding the online behavior for both new and old

customers, their preferences & interests, viewing pattern and

previous campaign response rate

▪ Designing campaign on available data, Hypothesis testing as

per customer requirement and designing of the target ads to

be used on social media

▪ Launching of campaigns on social media, tracking their

performance and cost of campaigns

▪ Regularly optimizing the campaigns as per the higher

conversion rate & least cost and successfully generate leads

for acquisition of new customers

The Value We Added

The analysis helped Client to develop focused marketing strategy

to target identified customer segments to increase customer

acquisition and increased conversion rate.

Web campaigns to acquire new customers through social

media channelsWeb Campaign Design

14PKC Advisory

Case Studies – Operational Analytics

0

20

40

60

80

Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Sep-19 Dec-19

NO

OF

FO

OD

TR

UC

KS

QUARTERLY DEMAND

Forecasting Demand of Food Trucks

Food TrucksForecast(Food Trucks)Lower Confidence Bound(Food Trucks)

0

10

20

30

40

50

60

70

Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Sep-19 Dec-19

NO

OF

PIC

K-U

P V

AN

S

QUARTERLY DEMAND

Forecasting Demands of Pick-up Vans

Pick-up Vans

Forecast(Pick-up Vans)

Lower Confidence Bound(Pick-up Vans)

Our Client

A Logistics company with large customer base

The Business Situation

As a part of the Client’s efficiency improvement initiatives,

PKC Advisory was mandated to assist in forecasting demand and

supply of services.

Our Role

PKC Advisory worked closely with the customer service

department to understand & retrieve data from the queue

management system. This included data for number of inquires,

type of inquiries, demand pattern, time taken across service

categories, time zones, demographic profile etc.

This was used to forecast the demand of services in next 6

months under different categories using the following approach;

▪ Gathering of last one year of customer, market and suppliers

data including seasonal and annual fluctuations and timings

▪ Studying historical demand trend in each of service segments

▪ Forecasting future demand including the seasoning & annual

effect and setting upper and lower limits of forecast

The Value We Added

Accurate forecasting led to optimum utilization of existing

resources, opportunistic augmentation of capacity basis demand

spike, significant drop in waiting time and cost savings.

Data analytics for improving forecasting efficiency for a

Logistics companyForecasting

15PKC Advisory

Case Studies – Regulatory Analytics

Data Quality Review

Model Methodology

Review

Variable Selection Validation

Model Evaluation of All

Models

Macro-Economic Scenarios Validation

Risk Staging

Back Testing Validation

Overall Validation

Review Submission

IFRS 9 Model Calculations

S.No COUNTRY Variable 1 Variable 2 Weightage 1 Weightage 2 Z FACTOR VAR 1 Z FACTOR VAR 2 Z-FACTOR

1 Algeria GDP Exports 0.8 0.2 -1.44 0.41 -1.07

2 Australia GDP Investments 0.8 0.2 0.00 0.00 0.00

3 Austria Unemployment rate Inflation 0.8 0.2 0.00 0.00 0.00

4 Azerbaijan Expenditure Exports 0.8 0.2 0.00 0.00 0.00

5 Bahrain Exports Net Lending 0.5 0.5 -0.23 -0.82 -0.52

6 Bangladesh Net Debt Exports 0.8 0.2 0.00 0.00 0.00

7 Belgium GDP Unemployment rate 0.8 0.2 0.00 0.00 0.00

8 Canada Inflation Investments 0.9 0.1 0.27 0.79 0.32

9 China Revenue Investments 0.4 0.6 0.00 0.00 0.00

10 Denmark Inflation Unemployment rate 0.4 0.6 0.00 0.00 0.00

Our Client

A GCC focused large Commercial Bank

The Business Situation

The Client had developed its IFRS 9 model and required

independent validation. The model validation was undertaken as

per the guidelines and calculation to measure Expected Credit

Losses (ECL).

Our Role

PKC Advisory validated the IFRS 9 model at multiple levels and

touch points to calculate ECL. The approach included:

▪ Reviewed all datasets used in different models and logics for

data set creation

▪ Methodological review of all IFRS9 credit risk models

including PD, LGD and EAD models

▪ Thoroughly reviewed the variable selection process and their

predictive power with dependent variable

▪ Undertook performance evaluation of models on various risk

measures like KS, Lifts and Accuracy level

▪ Macroeconomic variables scenarios testing and reviews

▪ Risk stage determination and staging thresholds robustness

The Value We Added

PKC Advisory identified and bridged the gaps in methodology as

per guidelines & calculation logics and validated the model

successfully. Client was able to submit the model which met all

governance requirements.

IFRS 9 Model Validation of Retail Commercial Bank IFRS 9 Model Validation Process

16PKC Advisory

Case Studies – Credit Risk Analytics

SamplingModel

Development

Reject

InferenceScorecard

Scorecard Development Process

Category Characteristics Attributes PointsCustomer

Score

Payment History

No. of Months

since most

derogatory

record

No Public

Records 70

400-5 10

"6-11 20

12-23 30

24+ 40

No of time 30+ days

Delinquent in last 6

months

Number of Time

gone 30+

delinquent

< 0 90

900-1 50

1-2 15

2-3 0

Outstanding Balance

Outstanding

balance in Dollar

($) value

No revolving trade 25

50

0 40

1-100 60

101-200 55

201-500 50

500-1000 25

1000 + 10

Month on BookNumber of

month on books

< 6 month 20

356-12 months 25

12-18 months 35

18 months + 45

Acquisition Scorecard

Our Client

A Retail focused Commercial Bank

The Business Situation

The Client intended to build Challenger Scorecard for personal

loans as current scorecard performance was deteriorating.

Our Role

PKC Advisory developed a retail acquisition credit scoring model

based on multi-Logit regression model. The approach included:

▪ Detailed study of existing customers’ one year development

data and 18 months performance data containing Customer

behavior data, Portfolio data, Bureau and Delinquency data

▪ Data wrangling including – Missing Value imputation, Outlier

treatments and Customer segmentation

▪ Variable selection through Clustering, IV and Correlation

analysis and finding relevant variables and Reject inference

▪ Developing and selecting the best model out of various

models that had the highest Accuracy, KS and ROC to predict

default probability of applicants

▪ Identification of default cut-off rate for model based on

management discussion

▪ Validation of model & further calibration

The Value We Added

The Client embedded the scoring model in its existing retail credit

appraisal process to ascertain credit worthiness of prospective

retail clients.

Development of Retail Acquisition Scorecard for a

Commercial Bank

17PKC Advisory

Our

Esteemed

Clients

18PKC Advisory

Our Esteemed Clients

19PKC Advisory

PKC

Advisory

Team

20PKC Advisory

Team Profile

Payal Soni - Chief Operating Officer

Bhupinder Singh - Senior Director

Vinay Gupta - Director Amit Chandra - Principal Consultant

Payal has a total work experience of over 18 years (including 14

years at PKC Advisory). Payal is a CFA Charter holder from CFA

Institute, USA and holds Masters in Finance from Delhi University,

India.

At PKC Advisory, Payal is actively involved in business development

and client engagement She has led projects related to strategy

consulting, risk & rating advisory, feasibility study, business &

financial due diligence, debt advisory, equity raising support and

transaction support services in Bahrain, Kuwait, UAE, UK and USA.

She has been involved in assignments in the financial services,

insurance, real estate and diversified sectors.

Bhupinder has a total work experience of over 15 years (including 9

years at PKC Advisory). He is a Chartered Accountant and has

cleared CFA Level III from CFA Institute, USA.

He leads the Financial Services practice at PKC Advisory. Bhupinder

is actively involved in business development, client relationship

management and project management. He has vast experience in

risk advisory, strategy consulting, financial planning, ratings advisory

and transaction support. Bhupinder has led numerous mandates in

these areas for leading banks and insurance companies in MENA

region.

Vinay has over 15 years of experience (including seven years at

PKC Advisory) in banking & financial services sector. Vinay is a CFA

Charter holder from CFA Institute, USA and holds Masters in

Business Administration from ICFAI Business School, India.

At PKC Advisory, he has handled various mandates in area of risk

advisory including risk appetite framework development,

standardized risk reporting, and ICAAP & Stress testing across

MENA region. Additionally, Vinay has worked on various assignment

related to capital planning, strategy consulting, financial planning,

and transaction support.

Amit has a total work experience of over 13 years in Advanced

analytics. He is a Bachelor of Economics and holds a Post Graduate

Diploma in Management from IIFT, India.

At PKC Advisory, he has been involved in a variety of mandates in

the areas of Advanced analytics including customer, operational and

web analytics. Besides, he has worked on various assignments

related to PD, LGD and EAD modeling for Basel and IFRS9.

Prior to PKC Advisory, he worked with Wells Fargo Bank, Royal

Bank of Scotland and GE capital in their Modeling & Analytics

Practice.

Sanjeev has a total work experience of over 17 years, in diverse

areas including strategy consulting, process consulting, market

study, feasibility study, business & financial due diligence,

performance enhancement, etc. He is Bachelor in Engineering and

holds a Masters in Business Administration from Indira Gandhi

Institute, New Delhi, India.

He oversees the Business & Financial Advisory, Process

Consulting and HR Consulting practice lines at PKC Advisory. His

experiences spans across education, real estate & infrastructure,

industrial, healthcare and hospitality sectors.

Zarvan Tafti – Director

Zarvan has a total work experience of around 15 years spanning

practice areas in business advisory/ consulting, investment banking

and private equity. He is a CFA Charter holder and MBA Finance

from Ohio University

He leads the Business & Financial Advisory practice and has

successfully managed engagements related to strategy, portfolio

evaluation, valuation, feasibility studies, business plan preparation,

transaction support across diverse sectors.

Sanjeev Arora – Senior Director

21PKC AdvisoryEmail : info@pkcadvisory.com Website : www.pkcadvisory.com