With its ProClassic/Enterprise, Wincor Nixdorf offers a solution for integrating various sales channels. Reasons for introducing a multichannel architecture vary widely. Some banks want to introduce new self-service applications as early as possible, while others are keen to link service terminals and Internet banking into their own self-service networks. Numerous financial institutions, for instance, want to operate self-service terminals from different vendors together in one network with centralised functions.
Data centers like GAD, however, are moving to replace OS/2- based servers and clients with platform-independent systems.
The goal of everyone, however, is to control escalating costs, expand sales through the various channels and generally increase productivity. For the intelligent linking of sales channels, Wincor Nixdorf has developed the ProClassic/Enterprise (PC/E) platform.
This solution is currently deployed in the Dresdner Bank and the Landesbank Baden Württemberg (State Bank of Baden Württemberg), in collaboration with GAD.
These deployments underscore that the branch hasn't lost any of its significance despite the steady encroachment of electronic sales channels. The long-expected demise of branch banking hasn't occurred.
While a retreat from a network of branches may save money, "it costs revenue and market share," said former Nassauische Sparkasse president Anton Mauerer shortly before his retirement.
NEW TASKS FOR BRANCH BANKS: That said, the role of the branch has changed, leading to a need for reorganisation. Between 30 and 40 percent of all standard transactions are already being handled in self-service areas - far more than at the counter.
The role of staff at the counter in a branch bank has to change accordingly. Savings banks recognise a general need to change cost structures and increase productivity - at all sales levels.
Yet the acknowledged need to upgrade IT infrastructures, particularly in the branch and self-service areas, didn't lead to a change of direction toward applications architecture.
On the contrary, it remained within the realm of the historically evolved silo structures and different technologies.
The installed network of terminals can't be replaced easily. But the clock is ticking. Not only is IT complexity increasing with the number of new services and sales channels; this development is accompanied by diminishing transparency of the costs involved in handling customers and their behaviour.
Costs can only be lowered in the long term if structures are integrated. An example: For a complete campaign management, the various channels must be integrated into a platform to increase transparency.
SELF-SERVICE: FROM COST PRODUCER TO REVENUE GENERATOR: Equally important, banks need to take advantage of the particular characteristics of the individual sales channels and their benefits in terms of customer service and sales opportunities.
In this context, self-service appears to be the only electronic channel through which banks have physical access to their customers. The 30 seconds of time customers spend in front of an ATM screen waiting for a task to be performed can be used by banks to promote services.
This time could be used, for instance, to display movie tips at nearby theaters and offer the opportunity to purchase tickets electronically, or to run ads for drinks, airlines or vacations, including discounts or other special offers. And why shouldn't banks promote their own services, even possibly tailored to specific groups?
One of the best examples of exploiting these sales opportunities is provided by Bank of America. The bank generates more than $2 million every six months from displaying AOL ads for 15 seconds on its network of more than 14,000 ATMs.
Multichannel solutions, though, offer much more than this. They can help reduce costs in the following ways (see boxes). Without dramatic changes in software architecture, such improvements are impossible. Existing heterogeneous and proprietary networks prohibit this.
Maintenance costs alone - they account for more than 80 percent of costs in numerous IT departments - prevent sensible blueprints being drawn up for the future. The reason: too much work.
One thing was clear when Wincor Nixdorf set off with its PC/E to move traditional and new sales channels onto a common platform: the heavily upgraded host area couldn't be touched - its structure and access had to be left alone. The central task was to establish a way to process and use stored data more effectively.
For the banks, this meant answering a bundle of questions. Will the change go down the path of open standards with Java technology? What about flat-client structures? And will software distribution have a new basis? Only around 20 percent of networks today are able to distribute software. The others unnecessarily drive costs up through their need for software to be distributed manually on site.
SOFT MIGRATION TO SMARTCLIENT ARCHITECTURES: An honest assessment of the situation is that the migration of all channels to a common architecture isn't possible in one step. Such a migration requires time. Nor can any one vendor supply the necessary equipment to cover all areas optimally.
With PC/E as a network- based middleware product, Wincor Nixdorf has focused on the migration to self-service and branch banking. These two areas account for around 70 percent of all money transactions in the network and as such carry the heaviest load.
The company's PC/E solution, however, isn't limited solely to this area. It includes brokerage packages such as call center software, banking via WebPads and PDAs.
The first projects in Germany with the Landesbank Baden-Württemberg, Dresdner Bank and GAD are proof that step-by-step implementation is the right approach. The approach also allows for fully different designs. Even though middleware based on Java 2 Enterprise Edition (J2EE) is moved out of the branch to the back-end, it doesn't have to form a dedicated level but can instead run directly on the host.
PC/E moves fat-client structures to socalled smart clients so that only browserbased access points connect to the channels. The clients are called smart because some system intelligence is still required for self-service, for instance, to eject bank or credit cards in the event of a system failure.
(The writer is Chief Operating Officer)
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