Pricing

Serve your stakeholders by achieving your Capital/ROA goals through Strategic Pricing.

Operational Effectiveness

Employee costs account for up to 80% of Non-Interest Expense.  Understanding these costs are key.

Portfolio Mix

Enhance balance sheet performance by identifying products that contribute, sustain, or diminish value.

Kohl's Strategic Pricing Framework

The framework underscores the significance of strategic pricing in financial services, advocating the Risk-Adjusted Return on Assets (RAROA) framework to balance profitability and risk. Emphasizing the Return on Assets (ROA) metric, it guides institutions in pricing to cover costs and manage capital.

The framework focuses on Liquidity/Interest Rate and Credit Risks in pricing, and the role of methodologies like Funds Transfer Pricing. It stresses accurate operational cost allocation and concludes with the necessity of centralized authority and aligned incentives within institutions for effective pricing strategies.  You can see our SPF in action by clicking the link below.

 

Snapshot

A fast, inexpensive service that determines product profitability based on a combination of your financial data and standard cost information from recently completed PVAs. It is excellent for companies that want to start small and grow into the more customized and detailed services we offer.

 

 

Product Value Assessment

The PVA provides a complete picture of the value contributed by loan and deposit products.  We work closely with functional areas to create a customized product value model based on your unique operations utilizing loan, deposit, and core transaction data as well as your organization's financials.   In addition, our customized Employee Cost Assessment identifies which employees are spending time on specific activities by product.

 

 

Multidimensional Value Analysis

The MVA is Kohl's flagship service.  It is a significant extension of Kohl’s Product Value Assessment (PVA), the MVA takes the balance sheet product level information from the PVA and drives it down to the individual loan and deposit level. This enables users to "slice and dice" profitability using Kohl-supplied OLAP reporting or the Business Intelligence tool of their choice.

 

How Do These Assessments Compare?
Comparison Chart-3