Business model of Nucleus Software

Customer Segments

Nucleus Software has a niche market business model, with a specialized customer segment. The company targets its offerings at firms in the banking and financial services sectors.

Value Proposition

Nucleus Software offers two primary value propositions: performance and brand/status.

The company demonstrates strong performance through tangible results. Examples of positive outcomes it has achieved for various banking customers include the following:

• 80% reduction in loan origination cost per customer
• 153% increase in turnover from Internet payment gateway transactions
• 600% increase in number of corporate transaction banking users
• 20% increase in income from cash management
• 25% reduction in turn-around-time for on-boarding

In addition, many of its clients have won awards after using its solutions, including process excellence awards, technology implementation awards, and model bank awards.

The company has established a strong brand due to its success. Its products are used by over 150 customers in more than 50 countries, affecting the lives of millions of consumers. Its clients include 3 of the top 15 banks globally and 3 of the top 10 automotive finance firms. It manages $147 billion in loans and processes 26 million transactions per day. Approximately 150,000 users log into its systems daily. Lastly, it has won many honors, including the following:

• The Model Bank Vendor 2016 Award by Celent
• The ICAI Award for Excellence in Financial Reporting
• Recognition as one of the “World’s Top Five Mobile Banking Solution Providers“ by Forrester
• Recognition by the Gartner Hype Cycle for Bank Operations Innovation
• The Nasscom Corporate Award for Excellence in Diversity and Inclusion

Channels

Nucleus Software’s main channels are its sales and business development teams. It also sells its products through a network of system integrators, independent software vendors (ISVs), and other distributors.

The company promotes its offerings through its website, social media pages, advertising, and participation in webinars, forums, summits, and conferences.

Customer Relationships

Nucleus Software’s customer relationship is primarily of a personal assistance nature. The company assists customers in the following ways:

Support Services -   The company provides the following services:

• Onsite Support – It maintains an implementation team that helps set up systems at clients’ locations, and then stays onsite for two weeks (longer if necessary) for any needed extra support
• Ring Fenced Team – It maintains teams of experts dedicated to supporting individual clients -- clients can effectively outsource their support operations to the company
• Remote Access – It obtains secure remote access to clients’ environments so it can hasten investigation, diagnosis, and resolution on support issues
• 24x7x365 Operations – It provides 24x7x365 phone and e-mail customer support

Training/Testing Services – The company provides these to help clients‘ employees get acclimated to its solutions‘ capabilities during the implementation process. Specific services are as follows:

• Classroom-Based Training Sessions – Classes that can be held at clients‘ locations or at the company’s academy. Sessions are delivered by its product and technical experts, who work with client staff to customize the courses to their firm’s needs.
• Day-to-Day Knowledge Transfer – Projects in which implementation staff members work with client staff members to deliver on-the-ground, day-to-day training on its solutions.
• Testing Services – A selection of tools and techniques to help clients test their solutions. These include scenario builders and simulators that aid with things such as performance, stress, and backup testing.

Consulting Services – Consultants who provide functional, technical, and business expertise on everything from proper configuration of solutions to the latest trends in business and technology.

Project Management Services – Project managers that use a methodology called FinnEdge to help clients successfully deploy short-term initiatives. These include everything from green-field installations to migrations from legacy solutions.

Despite this orientation, there is a self-service component. The company’s website features a portal that provides a knowledge repository and answers to common questions. It also provides a request tracking system through which they can track support query progress. Lastly, there is an “Insights” section with help resources such as articles, brochures, case studies, videos, and white papers.

Key Activities

Nucleus Software’s business model entails designing and developing its software and providing related services to customers.

Key Partners

Nucleus Software’s main partners are the suppliers who provide the products (software and hardware) and services (e.g., product delivery) it needs to run its operations. It also forms alliances with systems integrators, independent software vendors, and other distributors that promote and sell its products. Lastly, it works with prominent research firms such as Forrester, Celent, AITE, and Ovum to research and produce reports on the banking and financial services industries.

The company maintains the Alliance Program, through which it provides training (in sales, implementation, and customer service) and marketing support to its partners. The training is conducted by a group of experts and is delivered in both online and offline formats.

Key Resources

Nucleus Software’s main resources are human resources. They include the engineers that design and develop its software, the salespeople that promote it, the customer service personnel that provide support, and the training/consulting staff members that provide instruction and advisory help.

Cost Structure

Nucleus Software has a value-driven structure, aiming to provide a premium proposition through significant personal service and frequent service enhancements. Its biggest cost driver is sales/marketing, a fixed cost. Other major drivers are in the areas of travel and repair costs.

Revenue Streams

Nucleus Software has one revenue stream: revenues it generates from the sale of its software products to its customers.