BACKGROUND: First Union is a leading provider of financial services and is one of the top 20 credit card issuers in the U.S. With assets of $230 billion, First Union serves more than 16 million customers throughout the East Coast and the nation.

PLATFORMS: First Union runs Capstone Decision Manager on an HP9000 database server in a UNIX environment.

PROBLEM SOLVED: We needed a system that would let us make intelligent decisions at the individual customer level. With Capstone Decision Manager, we can optimize what we know about the individual needs and preferences of our customers and use that information to match the right customer with the right offer from our suite of products. In addition, the system is helping us better measure credit risk and profitability at the customer level.

PRODUCT FUNCTIONALITY: Currently, we're using Capstone Decision Manager to automatically decision new credit card account applications. But we plan to extend our use of Capstone to optimize a variety of portfolio management decisions including credit line assignment, credit line management and credit card authorizations. Ultimately, Capstone will play a key role in our CRM initiatives. There are any number of customer-level decisions that Capstone Decision Manager is ideally suited for, such as deciding whether a credit card applicant is also a good candidate for a mortgage loan. Capstone is a robust system that will allow us to make one-to-one decisions across large groups of customers at any point of contact, whether it's a branch, an ATM, a letter or the Internet.

STRENGTHS: Capstone's biggest strength is its flexibility. Now, when our business users need to modify the decision logic for a particular program, they can do so on the fly. With our old mainframe application processing system, changing decision logic was a time-consuming, labor-intensive task that required COBOL programming.

WEAKNESSES: Because Capstone is a distributed system and has many points of entry from which users can maintain the system's decision logic, it's sometimes difficult to manage change control. We view this not so much as a weakness of the system, but rather as a challenge we must overcome to harness Capstone's strength.

SELECTION CRITERIA: There are three main reasons we selected Capstone Decision Manager. First, we have a long-term business relationship with HNC that has served us well. Second, the technology Capstone offered was very consistent with our business strategy. And finally, when we first began evaluating decision systems in 1996, Capstone was the only client/server solution of its kind on the market.

DELIVERABLES: There are really no limits to the type of data you can capture with Capstone and then pull out in some form. For example, we can access credit bureau data directly from major credit repositories and then manipulate the data to fit our credit policies. Capstone also provides reports that evaluate the system's performance and the effectiveness of various strategies. And it includes a workstation component that lets our analysts view the data associated with any application that isn't automatically decisioned.

VENDOR SUPPORT: The vendor support for Capstone during pre-and post-implementation was exceptional. During pre-implementation, we had an integrated team consisting of First Union and HNC representatives. The HNC staff really understood the implementation issues we faced and worked so well with our staff that it was hard to tell who was a member of which company. As a result, the first phase of implementation went very smoothly. The second phase of implementation was a little more difficult, partly because we had to rely more on our own resources and less on HNC. We think the fact that the first phase of implementation went so well is a testament to the value added by HNC.

DOCUMENTATION: When we purchased Capstone Decision Manager, the documentation wasn't as comprehensive as we would have liked, probably because the product was still in the early phase of its life cycle. The documentation has since improved significantly.

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