Hiding software complexity
Hidden complexity is an important part of good software design. We often push some functionality towards the background in order to focus on the primary benefits. This makes software easier to use, but runs the risk of appearing incomplete. In the worst case, users will look outside to complete tasks already handled by the software.
Think about a good kitchen faucet. It will be easy to clean, move to where you need it, and remember the last cold/hot mix you used. But most important, it should be easy to turn on. So this feature is made very obvious.
Deposit pricing software is no different. The major reason for using it is optimize rates for higher profits (different from measuring profitability). So this is what is properly emphasized and this is what users think of first.
But it also makes sense to consider some of the secondary features that are integrated into any complete deposit pricing package. Three of the most important are:
- Profitability - How much is the bank earning from various deposit types and regions?
- Economic Value - How much are our deposits worth (core deposit intangibles)? What are they worth in different economic scenarios?
- Rate Exception Monitoring - How much are actual rates deviating from posted rates? Where do these exceptions occur?
The same calculations that are needed for deposit price optimization also let you answer other important questions. And the answers are superior to any external calculations because they are:
- More accurate - the underlying models are more precise
- More complete - all relevant factors are included in the numbers
- More detailed - you can drill down to specific regions, account types, etc.
- More accessible - output is provided in both Excel charts and tables
The moral of the story: even if necessity drives you to throw in everything including the kitchen sink, put the most important features front-and-center. But make sure the complete feature list is available for everyone, including prospects.
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