Company
Hauck & Aufhäuser Investment S.A. (HAIG), a 100% subsidiary of Hauck & Aufhäuser Banquiers Luxembourg S.A., has successfully operated on the Luxembourg fund market since 1989. In this context HAIG sees itself as a European investment company for high quality fund management and value-added services. This claim is based, among other things, on the company having been among the first EU compliant management companies to have been admitted under UCITS III in 2003.

Its spectrum of services ranges from fund concept and launch through daily fund management, risk management, individual client reporting, sales support and sales controlling. Whether it is public funds, private equity vehicles or special funds, HAIG guarantees the client an efficient, flexible and reliable service. As of 2007, HAIG managed more than 110 investment funds with a volume of approx. 4bn euros.

Hauck & Aufhäuser Banquiers Luxembourg S.A. (HAL) is a 100% subsidary of Hauck & Aufhäuser Privatbankiers KGaA, Frankfurt/Main and Munich and, since 1973, one of the first German independent banks to operate in Luxembourg. The activities of HAL are primarily focused on the investment business as well as private banking. In the investment business, the bank provides its service to investment companies, particularly to its own subsidiary, Hauck & Aufhäuser Investment Gesellschaft S.A., as a depository and merchant bank for their special funds.

Task
In 2006, the Hauck & Aufhäuser Group Luxemburg wanted to optimise its Sales Controlling offering to the investment market. Following the strong growth of this business area since 2003, along with the launch of many new funds, classic cost accounting appeared too inflexible to give satisfactory answers to efficient sales controlling. Issues regarding product return and the results of the customer relationship stood out as key areas to analyze. HAL determined that the method to be developed should be sufficiently precise for an evaluation of the product group, individual products and customers but simple enough to be updated monthly with little effort.

The aim of the project was to acquire a cost-effective, software-supported solution for the evaluation of product, mandate and customer results. The solution needed be scaleable and flexible in adapting to new business requirements while at the same time being very user friendly and require little administrative effort. The project period was set at a relatively short three months. Finally, the solution was to be used in advance of new invitations to tender to support the sales concept and pricing.

BOARD solution
The solution developed by Alpheus, a certified BOARD consulting partner, is a self-contained application which includes all functions for analyzing the cost of fund contribution. Key features include:

• Data transfer from the various upstream systems
• Master data maintenance of fund master data and individual cost drivers
• Calculation of systemic cost drivers and cost allocations
• Calculation of contribution margin, customer and mandate results
• Graphic analysis of key figures calculated
• Management dashboard for the management

Customer benefit
The Hauck & Aufhäuser Group Luxembourg received within the required project term the software-supported mandate and customer earnings statement so that after as little as three months the first calculations of the profitability of the fund products could be carried out. The solution provides transparency about all the cost components (cost drivers) and thus offers the opportunity to better control the sale of individual products or customer groups.

On the basis of the results, further analyses of the cost drivers can be undertaken in order to optimise the process efficiency and the key operational figures. In this context the cost drivers are automatically read in from the source systems where possible, or allocated by means of a specially created interface.

The project combines the greatest possible flexibility for the users as well as an increase in process automation. As an important benefit the transparency of the cost structure has enabled HAL to estimate prices that can be solidly justified in sales and customer care meetings and that thus the targeted returns can be better realised.