Cooperative Bank Case

1428 Words6 Pages
Title of the Report:
Case Analysis of ‘The Cooperative Bank’

The Purpose:
The purpose of the report is to submit the analysis of The Cooperative Bank based on the Activity Based Costing methodology

To whom it is submitted (Name of the instructor):
Prof. Sandhya Bhatia,
Professor, Managerial Accounting,
Indian Institute of Management, Udaipur

Name of the Author:
Abhishek Sengupta
Anubhav Nigam
Ravindran Damodaran
Saurabh Srivastava

Date of Submission:
24 February 2013

Organization/Institute’s name (and logo):
Indian Institute of Management, Udaipur

TABLE OF CONTENTS

Situation
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2. Clear Debit Items ($1022140) – The process of clearing Debit Items can be majorly automated through Automated Clearing Houses (ACH). The manual clearing facility may still be made available only on the basis of need and customer profitability.
3. Customer Inquiries ($850569) – This process/activity can be automated through Point of Sales (POS). The strategy can reduce the associated overheads and at the same time improve customer experience.

VISA Accounts: The VISA account is the second highest revenue generating stream. The revenue is contributed by the three products viz. VISA Classic, VISA Affinities and VISA Gold. Activity costs account to 40 % ($3385954) of the product revenue. The target cost reduction activities in this case are –

1. Process VISA Transactions ($917056) – These transaction activities can be automated through computer processing and this reduces the associated overheads.
2. Marketing and Sales Activity ($453886) – These costs can be reduced by having cross-sales of Credit cards with the current Account customers
Personal Loans: The product gives the highest net profit among the range of available products. The Marketing and Sales Activity ($815211) and Computer Processing activity ($113403) can be reduced by the deploying of strategies as for Visa Accounts and Current Account respectively.
CUSTOMER EXPERIENECE AND PROFITABILITY
The improvement in Customer Experience and Profitability was
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