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Please use this identifier to cite or link to this item:
http://hdl.handle.net/2451/14339
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| Title: | MODELING THE PROFITABILITY OF CUSTOMER RELATIONSHIPS: DEVELOPMENT AND
IMPACT OF BARCLAYS DE ZOETE WEDD'S BEATRICE |
| Authors: | Stuchfield, Nic
Weber, Bruce |
| Issue Date: | Aug-1992 |
| Publisher: | Stern School of Business, New York University |
| Series/Report no.: | IS-92-23 |
| Abstract: | Traditional management accounting systems are limited in their ability
to provide profitability information relevant to management decisions.
The problems of inadequate profitability measurement are intensified in
today's business environments, where changing margins due to
deregulation and new entrants, new products with unknown costs, and
customer sophistication in locating low-cost providers often combine to
leave unprepared firms with growing numbers of loss-making client
relationships. In response, firms in a number of service and
manufacturing industries are experimenting with new methods for
measuring performance, and are implementing these techniques using
information systems. The collection and analysis of information on the
profitability of customer relationships enables managers to identify and
defend their most attractive market segments, and to turn loss-making
accounts into profitable ones. The London-based securities house, BZW,
developed BEATRICE, an innovative information system that combines
activity-based accounting principles and a model of customer
profitability to make an income assignment to each of the 6,000 trades
the firm makes in a day. The system's value is considerable, and can be
evaluated by using industry performance benchmarks, and by comparing
management decision-making with the currently available information to
what was possible with previous data. |
| URI: | http://hdl.handle.net/2451/14339 |
| Appears in Collections: | IOMS: Information Systems Working Papers
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