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  "docSlug": "5ed2948670d00135",
  "documentTitle": "Customer Experience: The 14BN Risk Noted for Discussion",
  "authorId": "misc",
  "authorName": "Oliver Wyman",
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  "notes": "The slide uses a mathematical formula structure to explain the CVaR calculation.",
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      "kind": "diagram",
      "text": "Customer Value at Risk CVaR = Attrition due to poor Customer Experience x Expected value loss",
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      "text": "The probability of reducing relation will be calculated according the data obtained with the survey, having previously identified the clients who decreased their relation with the bank. This way, the probability of reducing relation for clients with bad experiences will be calculated as:",
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      "text": "Loss on value will be calculated based on historic data from clients who have reduced their relation. Therefore, expected loss on value will be calculated as:",
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      "text": "Probability of reducing relation because of bad exp (%) = # clients who reduced relation because of bad experiences / # clients who have had bad experiences",
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      "text": "Expected loss on value (%) = Σ (Gross margin t / Gross margin t-1) - 1",
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      "text": "CVaR is calculated as the probability of decreasing relation because of bad experiences times the expected loss on value",
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