Example:-
Use Case: Digital Transformation of Credit Risk Management
Objective
To enhance credit risk management processes through digitization, improving efficiency, accuracy,
compliance, and decision-making capabilities.
1. Initial Assessment and Strategic Planning
Stakeholder Consultation:
o Conduct workshops with key stakeholders (Risk Management, Business Units, IT,
Compliance) to identify pain points and gather insights on current credit risk
management processes.
Vision Definition:
o Establish a clear vision for digitization, focusing on goals such as reducing turnaround
times for credit decisions, enhancing data accuracy, and ensuring regulatory
compliance.
2. Data Integration and Management
Data Inventory:
o Identify and catalog all relevant data sources (e.g., internal databases, external credit
bureaus, transaction data).
Data Centralization:
o Collaborate with IT to develop a centralized data warehouse that consolidates data
from multiple sources, ensuring data quality and accessibility.
Data Preparation:
o Use tools like Tableau Prep to clean, transform, and prepare data for analysis,
ensuring it is suitable for modeling and reporting.
3. Development of Analytical Models
Credit Risk Scoring:
o Work with data scientists to create machine learning models that assess
creditworthiness, using historical data to predict default probabilities.
Segmentation Models:
o Develop customer segmentation models to categorize clients based on risk profiles,
allowing for tailored risk management strategies.
4. Dashboard and Reporting Solutions
Dashboard Design:
o Create interactive Tableau dashboards that provide real-time insights into portfolio
performance, risk exposure, and key metrics (e.g., default rates, risk-adjusted
returns).
Automated Reporting:
o Implement automated reporting solutions to streamline the generation of regular
and ad-hoc reports for management and regulators.
5. Policy Development and Implementation
Risk Policy Framework:
o Develop and refine portfolio risk policies, ensuring alignment with the bank's risk
appetite and regulatory requirements.
Training Programs:
o Conduct training sessions for teams on new policies, procedures, and the use of
digital tools in credit risk management.
6. Agile Management and Execution
Agile Methodology:
o Act as the Product Owner, facilitating Agile ceremonies (sprint planning, daily
standups, retrospectives) to ensure teams are aligned and productive.
JIRA Management:
o Write clear and detailed user stories in JIRA to guide development teams in creating
features that enhance credit risk oversight.
7. Compliance and Risk Management
Regulatory Compliance Checks:
o Implement automated compliance checks to ensure adherence to internal policies
and external regulations.
Risk Assessment Protocols:
o Establish protocols for assessing risks associated with business decisions, ensuring
alignment with the bank's reputation and ethical standards.
8. Continuous Improvement and Feedback Loop
User Feedback Collection:
o Regularly solicit feedback from users of dashboards and reporting tools to identify
areas for improvement.
Iterative Enhancements:
o Continuously refine analytical models, dashboards, and processes based on user
input and emerging best practices in credit risk management.
9. Performance Measurement and Reporting
Key Performance Indicators (KPIs):
o Develop KPIs to measure the effectiveness of digitization efforts (e.g., processing
time for credit applications, accuracy of risk assessments).
Executive Reporting:
o Prepare and present comprehensive reports to senior management and the board,
showcasing the impact of digitization on credit risk management outcomes.
