Business Value from Unified Communications in Financial Services

Business Value from Unified Communications in Financial Services Leon Grekin Customer Business Transformation Voice Technology Group Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 1

CXO TOP PRIORITIES: ACCELERATE RECOVERY AND SET-UP FOR GROWTH Accelerate Recovery Stop the Bleeding Increase Revenues • • Strengthen and maintain credit quality Improve Efficiency Ratio (w/focus on Cost Reduction) Streamline and accelerate processes Improve existing asset utilization • Increase product cross-sell (e. g. Investments) • Focus on higher profitability products • Grow target segments (e. g. ; Business Banking) Position for Growth Drive Differentiation Efficient Growth Session Number Presentation_ID • Lead in customer experience for differentiation • Innovate on service offerings • Develop closer connection with customers • Accelerate new product time to market • Attract users to self-service and low cost channel • Evolve and diversify Asset mix Source: Client Presentations to Analysts, CXO Discussions, VTG/CBT Analysis © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 2

BUSINESS VALUE OF UNIFIED COMMUNICATIONS – HIGHER VALUE FROM TRANSFORMATION 3 -10 x value of TCO savings Business Transformation Business Value Business agility and market differentiation Employee Productivity Collaboration and efficiency Convergence IT TCO – pays for itself Innovation Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 3

Branch CC Banker l. S pe i g rt In na te ge ra ct iv CC e W Vi eb rtu al UC iz at En io ab n le M d ob Pr os ili pe ty ct Co in g lla bo ra Vi tio de n o O n de m an d SPECIFIC CXO CHALLENGE TR U AN C SF BU S O O S Vi rtu LU R IN al TI MA ES Sa O T Di le N IO gi s N ta Ex FINANCIAL SERVICES INSTITUTIONS HAVE ALREADY IDENTIFIED SEVERAL TRANFORMATIONAL SOLUTIONS TO ADDRESS CXO CHALLENGES Product Cross-sell Grow Target Segments nc ge er nv Co Improve Efficiency Ratio (Reduce cost) IP Streamline and Accelerate Processes e Differentiate on Customer Experience Drive self-service and low cost channels Session Multiple Number Source Business Transformation Engagements, CBT team Analysis Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 4

HIGH LEVEL RATIONALE OF TOP UC ENABLING OPPORTUNITIES IN FS Banker Contact Center Branch Opportunity Business Value/Rationale Virtual Sales Expert • Increase cross sales by having virtually a product sales expert accessible at every branch (e. g. Mortgage, Investment) Digital Signage • Increase product inquiries and sales using centrally managed video displays and/or sound (rich media signage/ advertising) at branch locations Interactive Web • Drive value online by facilitating product sales, increasing differentiation and customer service levels while reducing CC handling times. CC Virtualization • Capture economies of scale (cost), increase flexibility and customer experience by reducing call wait times, Contact Centers or finding expertise in other CC or company locations. UC Enabled Prospecting • Increase prospecting capacity by closely integrating CRM and UC to improve contact history and save banker’s time Mobility • Increase reach when out of office by using Single Number reach, Presence as well as reduce airtime costs. Internal Collaboration • Improve associate productivity and response to customers by removing barriers to cross functional collaboration. Video On Demand • Accelerate product launch, new associate training and time to revenues by enabling desktop video on demand. Overall IP Convergence • Reduce Total Cost of Ownership by converging data and voice networks. Session Multiple Number Source Business Transformation Engagements, CBT team Analysis Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 5

HOW CISCO CBT CAN HELP IDENTIFY THE VALUE OF UC FOR YOUR INSTITUTION • Team of highly-skilled Cisco Unified Communication professionals with extensive financial and business process knowledge • Partner with your team to discover and prioritize business x 4 mational opportunities • Assess economic impact and returns • Propose initial project budget • Quantify and qualify the merits of your first project • Hard ROI • Quantifiable cost savings • Most engagements yield self-funding projects From existing OPEX & CAPEX Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 6

JOINT ENGAGEMENT MODELS Low Session Number Presentation_ID Low Business X 4 mation Deep-dive Business X 4 mation Light-touch Customer Business x 4 mation Workshop Quantify & Qualify the business case Prioritize Key Business Objectives Investment Thesis with Unified Collaboration Process Maps Alignment with IT Alignment with the Business High Cisco Collaboration Architecture [Phase-1 Deployment] Architectural Thesis With Enterprise Unified Collaboration Roadmap Cisco Partner Time and Depth of Analysis High Light touch and Deep-dive engagement share the same methodology, but differ in complexity, scope and required resources © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 7

Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 8

Other Use Cases: Customer specific UC Transformation opportunities for key roles Relationship Agent Customer Service/Support Agent Role: Deepen relationship with customers on service and cross-sell Issue: Time spent on low value added tasks instead of sales efforts Impact: Free up 30 -45 minutes per week per agent From To Solution Rich Media Conferencing Built in Outlook Product Prospecting Agent Role: Drive new product adoption Agent Issue: Small ticket product are not worth travel time to present to customers Impact: Double exposure of products and 40% sales increase From $ Session Number Presentation_ID To $ Solution Web Enabled Rich Media Collaboration © 2005 Cisco Systems, Inc. All rights reserved. Role: Resolve transactional issues that customer face Issue: Too long cycle to respond to some customer issues Impact: Reduce service cycle from 3 days to 25 min From To Solution Click-to-Talk and Co-Browsing Back Office Agent Role: Ensure the proper paperwork is obtained and complete for a loan Issue: 4 -8 iterations between back office, relationship agent and customer Impact: Reduce documentation lead time by half and improve customer sat From To Solution Presence, IM, Video Collaboration Cisco Confidential 9

7 Financial Services Companies Are Exploring UC Enabled Solutions to Capture Business Benefits UC Enabled Solution Institution Business Benefit • 2 Top Retail Banks, • Virtual Sales Expert US • Stop revenue leakage • Improve cust. experience • Major Bank in India • Virtual Sales Expert • Drive product cross-sell • Shorten time to market • Leading Investment • UC Enabled Prospecting • Grow customer base • Improve cust. experience Bank in US • Top Property & • Virtual Sales Expert Casualty Insurance, • Rich media product US training • Drive sales of complex products • Shorten time to market • Leading Financial Advisory Co. , US • Virtual Sales Expert • Drive sales of complex products • Financial Advisory Company, US • Virtual Sales Expert • Drive sales of complex products • UC Enabled Prospecting • Grow customer base • Mobility/ Single Number • Improve cust. experience Reach Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 10

EXAMPLE: Virtual Expert - Small and Medium Business Banking Example Virtual Sales Expert Virtual Expert Stop 10%+ Unit revenue leakageat • §Business Growing yearly rate 70% Capture. 25% to 1% interest premium from • §Challenge to ramp up becoming benchmark on SMB loan speed product skills among bankers • § 10%+ loan. Relationship opportunity lost from Accelerate Manager ramp-up slow response and missed leads $60 MM Additional Profit to bottom line over 5 yrs. Same solution used for internal • • Product Specialist availability collaboration: Virtual Credit Discussion became growth bottleneck 20% increased Specialist availability Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 11

Virtual Sales Expert Sales Process Flow One Click Initiation Customer At Branch • • Client at branch • Contacts Relationship Manager/ • Branch Manager • Identifies SMB • opportunity • Both go to “SMB Room” – Two seat station • – Privacy – Premium space in Branch/Ambiance – Always on Easy Collaboration Expert Presence on screen • Manager does introductions Click onto “green” expert • Expert takes over Immediate voice and video (in window) Expert sees both Manager and Client • If needed, turns to collaboration to share documents, spreadsheets or fill forms together Closure • Qualified lead • Client agrees to product and tentative rates • Schedule site visit • Remote Print/Scan – Documents – Agreements – Marketing Materials Revenue Leakage Reduced Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 12

Virtual Sales Expert Virtual Expert – Site Pictures Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 13

Virtual Sales Expert Quantification Example: Virtual Sales Expert Stops Revenue Leakage at Retail Banking Revenues/banker Assumptions: • Banking centers: 2, 335 • # Associates on the platform: 2. 5/center # of Complex % of Sales Leakage In X Products X /Banker/ Branches Month 10% X 8 X Ilustrative Estimate Average … % NII product X Margin X sold Average Size Product Sold HELOC X $75 K 60% X 3% 1 st mortgage X 20% X 3% $125 K X Closing Ratio of # Of Virtual X Bankers Experts X 30% X 5, 837 X 12 Months Investment 20% X 3% X $10 K = $36. 3 M NII+Non. II - $1. 5 M Labor Costs = $34. 8 M Per Year Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 14

Example of Digital Media Management Implementation in Branches Digital Media Apply for a card! HSBC Live! program • HSBC Live! radio pilot in 50 branches in 2004 • Mix of speech, staff features, endorsements, news, music, service tips, and product information • Rolled out to top 400 branches in 2005 and other major outlets • HSBC Live! TV launched in 2004 to communicate information on products, promotions, and bank strategy Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Results • 33% increase in customer inquiries in branches with access to HSBC Live! TV after a promotion of home and auto insurance products • Rolled out to 800 additional branches in 2006 • Best Use of IT in Retail Banking Award, European Banking Technology Awards 2006, Banking Technology Magazine, November 23, 2006 Cisco Confidential 15

Illustrative Quantification: Digital Media Generates Incremental Product Revenues Assumptions: • Banking centers: 2, 335 • # Associates on the platform: 2. 5/center • 12 inquiries per month/banker w/o digital media # of Product Inquiries/ Banker/ Month 12 Digital Media Uplift Inquiries Leads 50% X 30% X Illustrative Estimate Sales Average % lift from # Of X Size Digital X Product X Bankers Media Sold % of Inquiry % Lead to % of Mix NII X X to Lead sold Margin X X Closure X Digital Media HELOC X $75 K 60% X 3% 1 st mortgage X 20% X 3% $125 K X 5, 837 X 15% X 12 Cons. Lending + Investment 20% X 3% X $10 K = $40. 8 M NII+Non. II - 5 M Cost = $35. 8 M NII+Non. II Per Year Session Number Source: VTG Presentation_ID Customer Business Transformation Team (CBT) © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 16

Bank of America: “Invite-To-Chat” to Boost Small Business Sales Interactive Web Overview • B of A launched “Invite to Chat” feature to increase sales, conversion rates Using invite to chat in several areas of B of A site, including Small Business Chat conducted by small business sales specialist vs. general customer service rep • B of A senses prospect comparing different business checking accounts, and sales specialist invites customer to discuss options via live chat Benefits • Invite to chat helped B of A increase online small business sales 324% from 2005 to 2006 Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 17

e. Trade Case Example: Click to Call on Website to Drive Mortgage Sales Interactive Web • Piloted “Invite-to-Chat” in early 2004 – Chat invitation offered in select areas using simple business rules – Example: “Site visitor who remained on Express Rate Quote page for a minute was invited to chat” – Goal: engage prospect with sales rep to achieve higher conversion rate, greater customer satisfaction • Concept now in full roll-out – On-going customer sat surveys show that customer who engaged in chat are more satisfied with lending process – Chat invitation acceptance rate – 8% – Subsequent mortgage application rate – 13% – E*Trade seeing increase in applicationto-fund ratio for invite-to-chat participants Additional sales from the same Web Asset 1% of product tab/page visitors apply for a Mortgage Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 18

Illustrative Quantification: Click-to-talk on the Web for Additional Revenue Assumptions: • Website Visitors: 3 MM/mo. • Visitors that mouse hover mortgage tab/page: 5% Interactive Web Illustrative Estimate Increase in Applications Increase in Sales Visits Applications Sales Average Size X X Product Sold % of Main site % that % of Mix NII Visits/ X Mortgage X X accept apply sold Margin hovers Month % that close X 12 months Home Equity Loan 70% X 3% 3, 000 X 5% X 8% X 13% X X $75 K 1 st mortgage X 30% X 3% $125 K X 80% X 12 = $40. 4 M NII+Non. II - 2 M Opex Cost = $38. 4 M NII Per Year Source: Session Number VTG/Customer Presentation_ID Business Transformation Team Analysis © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 19

Forrester Survey Endorses Value from Interactive Web 9. 4% weighted average estimate increase in revenues from the Web! Source: Forrester Session Number Presentation_ID Survey, VTG/Customer Business Transformation Team Analysis © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 20

Interactive Web Customer Experience Example: Support Rep Resolves Issues Faster As is… …With Unified Communications Case Closure time: 3 days to 1 week Rep asks for user ID and issue Rep gets a blind customer call Rep has just a “web mockup” Rep can’t see actual screen or error 10 -45 minutes Insert of screenshot on case order Opens and populates case Researcher investigates issue in transaction and web history (1 -3 days) Customer has to send screenshot of actual page (fax/e-mail) Case Closure time: Same Call Click to Talk User didn’t complete final step when scheduling transaction Rep calls customer Co-browsing Should we call you at 555 -6666 OK Rep. Gets screenshot and understands issue Calls Research group CTI Change System Recognizes user and case is populated with customer info and likely case type Rep sees actual screen with issue Identifies missing step and explains to customer Customer acknowledges missing step and learns to avoid it Customer gets an answer but doesn’t learn to avoid issue 1 -3 days to resolve 10 -45 minutes of Representative time Several hours of researcher Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. 25 minutes to resolve Resolution in the same call Reduce future call volume Cisco Confidential 21

CC Virtualization improves capacity, reduces queues and trunking costs 3 Separate Contact Centers Total 30 agents working separately 3 CCs virtualized into 1 CC With 30 agents working together Talk time = 180 s Service level = 80% calls in 20 s Wrap up time = 60 s Collectively CCs handle 300 calls per hour Average queue time = 13 s Requires 36 incoming trunks The CC can handle 370 calls per hour Average queue time = 10 s Requires 30 incoming trunks Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 22

Virtualizing similar application smoothens peaks and improve ASA 66 vs. 1 ASA 51 vs. 1 ASA 86 to 34 vs. 1 CC Virtualization EXAMPLE 6/30 14: 30 to 15: 00 App 1 – 9, 711 Peak Calls 1, 196 Agents App 2 – 2, 972 Peak Calls 469 Agents Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 23

Actual Study Example: Impact of Virtual. Izing 2 Contact Center Apps 1. 2. 3. Session Number * Presentation_ID Assumes 1000 total agents with loaded cost of $50 K © 2005 Fully Cisco Systems, Inc. annual All rights reserved. CC Virtualization EXAMPLE Calls Constant, 28 Sec ASA SLA, Reduce Costs: Reduce avg queue time by 16 sec, reduce peak agents by 29 (1. 8%), total agents by 95. Save $4. 3 M per year on Personnel and LD transport Calls and Agents Constant, Improve Service Level: Go from 57 sec. ASA at App A and 1 sec. ASA at App B to 4 sec. ASA Overall. Service Level and Agents Constant, Increase Call Handling Capacity: Expand capacity by 1. 8%, from 12, 178 calls handled to 12, 400. Cisco Confidential 24

Case Example of IT TCO Savings in Large Multi-Site Contact Center CC Virtualization Customer: Financial Services institution with greater than 20 sites, over 15 M IVR and ACD calls per month, over 15, 000 agents. Significant IT TCO Annual Savings Opportunities 1. Move to D 3 termination on PBXs - $5 MM savings 1. Today 2, 500 T-1’s paying $300/mth TI facilities charge per line 2. Could reduce to 1, 000 T-1’s (most TDM PBXs do not support D 3) 2. Replace Outsourced IVR with in-sourced CVP - $10 MM savings 1. Today paying 2 cents for 55 M minutes / month 2. 8, 300 ports in IVR across 3 nodes 3. Avoid pre-routing everything over ICM and MCI - $3 MM savings 4. Enable reduction of LD rate by 20% - $4 MM savings 5. Upgrade MPLS Network - $5 MM additional cost Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 25

CC Virtualization Contact Center - UC Enables Home Agent / Off Shore / Near Shore Models Home Agent Near Shore PSTN Off Shore Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 26

CC Virtualization Business Transformation Example: Tap into new talent pools of at home agents Initial Estimate Potential Impact of 1, 000 At Home Contact Center Agents 1. Increased Sales Capacity Utilization Traditional Contact Center At Home Virtual Contact Center 40% 2. Lower Sales Agent Turnover 3. Better Conversion Through Skills Routing 65% 20% 75% Costs $12. 5 K To Train New Agent 20% ~$0 200 x $12, 500 = $2. 5 M TBC 22% 4. Real Estate Savings 15% x 1, 000 x $35, 000 = $5. 25 M $2000 per agent per year $2, 000 x 1000 = $2. 0 M TOTAL VALUE PER YEAR: $9. 75 M Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 27

UC Enabled Prospecting Click on client number Outbound Phone dials out Ease of use: Time Savings: Better interaction: • Click to dial • Customer call date/time/number and duration instantly logged on CRM • CRM notes screen for gets opened up immediately • No mis-keyed calls • Quick redial if busy Inbound Caller name resolution + info Agent accepts call on screen • Ease of use helps higher note capture completeness during/after call Notes field popsup Time Savings Ease of use: Better interaction: • Call time gets automatically logged on CRM • Mouse-click convenience • Prior notes immediately available • Advisor knows client name from the beginning Session Number Presentation_ID CRM notes field pops-up • Phone can answer on hands free mode • Ease of use helps higher note capture completeness • If Advisor can’t take call it can during/after call be flagged for call back © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 28

Mobility Business Value Mobility ILLUSTRATIVE Hard Cost Savings Direct airtime cost reduction Interactive TCO and Total Value tool ($900+ 5 yr TCO savings/user) • Mobile/Desk two way hand-off Multiple Devices and OSs • Extended least cost routing * Productivity • Integrated call log** (40+ hours/year back to employee) • Secure on-net Text Messaging Customer Impact $500+ additional revenue/employee Redirecting 25% of time savings to service and prospecting (at average revenue per employee) Availability: Session Number Presentation_ID * 6 months, ** 12 months (subject to change) © 2005 Cisco Systems, Inc. All rights reserved. Value of 50% time saved at employee’s comp. Softer Benefits • Visual Voicemail • Corporate directory w/click to call and presence • Click to join conference call ** Cisco Confidential 29

Reduced Cost: Shift Airtime to Fixed As Is – With Plan Optimization Mobility Case Example With Single Number Reach $ 0. 10 Inbound Airtime External Caller dials cell by default Office/Campus External Caller Dials office number now Mobility Server Office/Campus PBX $ 0. 02 Landline Inbound Company Paid Cell Phone Total Cost: $ 0. 10/min Session Number Presentation_ID 12 -15% total cell expense savings © 2005 Cisco Systems, Inc. All rights reserved. Total Cost: $ 0. 02/min Cisco Confidential 30

Collaboration Internal Collaboration: Improve Banker Productivity and Customer Service Responsiveness From… …To UC-enabled Personal Banker For Off-Hours/On-The-Road Availability Managing multiples devices and phone Receiving calls from multiple devices to a numbers (e. g. , cell, home office, single extension and forward calls to home number) and checking multiple voice multiple devices mail boxes UC-enabled Banker for personal productivity Email and voice-mail separate, impossible to forward voice-mail to internal/external recipients For example: (1) listen to voice mail from Outlook; (2) forward voice-mail through email; (3) listen to email on the phone (e. g. , in transit) and (4) reply to email with a voice attachment (e. g. , in transit) UC-Enabled Personal Bankers For Remote Interactions With Customers Majority of the interactions requiring document reviews completed by Personal Bankers with their customers are in-person Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Part of follow-up interactions completed by Personal Bankers with their customers are in-person, part over web collaboration for tech-friendly customers (voice, data and video) at the place of their choosing Cisco Confidential 31

Productivity Benefits from Single Number Reach Collaboration 9. 9 min/day Weighted avg. Represents a week per year back to the employee Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 32

Collaboration Forrester Survey Shows Productivity Benefits from Presence - Loan Process 9. 5% weighted average time per loan reduction means almost 10% increase in productivity! Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 33

Video on Demand – 2 -3 Minute Focused Short Videos Professional in Seattle identifies a targeted best practice (e. g. , crossselling mortgage, Q&A on new Investment, Sales tip) … … either professional production, segment of larger VOD or You. Tube like recording (desktop camera, self service VOD capture station) Video-on-Demand After compliance review, VOD is published onto the relevant intranet site with email alerts to targeted individual in the community Accelerate the leverage of knowledge assets across branch footprint Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 34

Webcast and/or Replay Meetings Video-on-Demand Basic: • Live Video Recorded From Video-Room to… Enhanced: • Build Table of Contents • Power. Point Synch • Segmentation into short videos by topic Scenario • Product Manager explains new product/service opportunity and offers sales guidance live Video on Demand at FA own office In the deployment phase: • VODs recorded to provides details on product features and recommended sales techniques • Slides presented in synch with video run • Can contact presenter (availability) Faster go-to-market = faster revenues + increase cross-sell + more products/ year Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 35

Agenda • Key Business Challenges and Priorities in the Financial Services Industry Today • Transforming Financial Services with Unified Communications • Reducing Total Cost of Ownership with Unified Communications Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 36

Branch Convergence to Lower Opex IP Convergence South. Trust Bank Strategy: 1 Cisco “Virtual Branch Exchange” for 700+ Branch Locations • • • Centralized administration & maintenance Common dial plan, directories, voicemail Save $5 M in annual telephony costs 20% reduction in local circuits 51% reduction in MACs 38% reduction in LD Save $700 k in annual PBX maintenance Save on support labor: one IT team crosstrained for voice/data Save 94% reduction in conf. call charges Branch 2 Branch 1 Branch 3 Bran ch 4 PST N Headquarters Branch 5 Branch 700 Session Number Presentation_ID Branch 699 Branch 698 © 2005 Cisco Systems, Inc. All rights reserved. • 6 th largest bank in U. K. • Targeting UC for comp. advantage • 32 HQ Offices - DPNSS TDM PBX interworking w/ UC & IP VPN to replace leased lines (Vo. IP Port) • 750 Branch Offices − were on mix of FR, ISDN, DSL KTS − migrated to high speed networks w/ IP Phone connectivity to Voice VPNs & BT managed CCM (MMVo. IP) Key Benefits: – Network consolidation – Improved branch capabilities – Improved flexibility & efficiency – Millions of pounds in cost savings Operated as a Managed Service by British Telecom “ 10’s of millions of pounds savings projected Deployed 700 branches and 66 HQ sites in <12 months Cisco Confidential 37

UC can drive 20 -30% reduction in Voice IP Convergence Communication TCO 5 Year TCO $ millions Illustrative Numbers -$15 $500 $50 -$25 -$40 -$25 -$20 $405 TDM Equipment Staff Tele- Conference Facilities MACs Post-UC Cost Savings worker Savings Deployment Cost & Toll Connectivity & Savings “As Is” Savings Bypass Maint. Cost Savings “We will drive a ~30% savings in voice expense by moving to UC” • Fred Spulecki, Director IBM/ Cisco Initiative Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 38

Example: Sources of TCO Savings Analysis($ Millions) IP Convergence Savings from enabling on-net voice 20% voice savings from on-net site-to-site calls (Source: NA Conf. model). 50% video savings from IP enabling Conferencing Rooms to save on ISDN lines (Ref. 50% benchmark savings). 30% captured in 2007, 80% in 2008 and 100% in 2009. 30% termination of leases in 2007, 80% in 2008 and 100% in 2009. Leases terminated as replaced by UC equipment purchase. 80% cost reduction from plug & play ability and consequent labor reduction. (Based on benchmark savings range 70 -90%). Assumes 30% captured in 2007, 80% in 2008 and 100% in 2009 15% cost reduction from site-to-site toll bypass, PSTN substitution and trunking optimization (based on benchmark savings of 10 -20%). Assumes 5%/yr toll price erosion. 30% capt. in 2007, 80% in 2008 and 100% in 2009 40% savings from IP lower maintenance cost (benchmark savings of 30 -50%). 30% captured in 2007, 80% in 2008 and 100% in 2009 10% cell phone cost reduction from using softphone at hotels (benchmark savings) 20% Calling card/hotel calling cost savings from softphone use (20 -25% benchmark range) 65% Telecommuter cost savings from voice line subst. by softphone(50 -80% benchmark) - All 30%captured in 2007, 80% in 2008 and 100% in 2009 30% Domestic LD reduction from on-net site-to-site calls, and tail end hop-off (18 -40% benchmark). 70% Intl. LD reduction from same rationale (65 -75% benchmark). Assumes 5%/yr toll erosion. 30% capt. in 2007, 80% in 2008 and 100% in 2009 20% cost reduction from site consolidation and remote management (based on benchmark savings of 0 -35% ). 30% capt. in 2007, 80% in 2008 and 100% in 2009 $82 MM 5 yr Total TCO savings Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. $50% savings from on-net voice Cisco Confidential 39

Example: Year by Year TCO TDM vs. IP Comparison (Cash Flow View) IP Convergence ILLUSTRATIVE ~30% Ongoing TCO savings (%) from 2009 on Leasing the initial investment would mitigate the year 1 investment peak Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 40

Quick Recap on the Business Value of UC Unified Communications can help address the major goals of the Financial Services Institutions by: 1. Substantially reducing IT total cost of ownership for communications and pays for a solid, open and extensible platform/. architecture to build upon 2. Improving productivity and efficiency through streamlining communications and enabling superior services that integrate voice, video, data and business applications 3. Enabling business transformational opportunities that: - Capture revenue opportunities - Create competitive differentiation - Enhance customer experience Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 41

Session Number Presentation_ID © 2005 Cisco Systems, Inc. All rights reserved. Cisco Confidential 42