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KM movement in banking heightens interest in EDMS, imaging and workflow

This article appears in the issue June 1998 [Volume 7, Issue 8]

The dramatic evolution of the banking business was the focus of the 1998 BAI Transaction Processing and Image Technology Conference held in March in New Orleans.

Entitled "Digital Gold, Profiting from the Changing Payments System," the BAI (Bank Administration Institute, www.bai.org) event was organized by Brian Black and a team of conference managers. A premier education forum for technology and banking, the conference was organized into six tracks:

  • the electronic check and evolution of the paper world into the digital world

  • regulatory and transaction management issues

  • payment systems fraud control

  • electronic commerce and Internet payment systems

  • the evolution of card technologies, direct banking and ATMs

  • electronic document management and leading-edge technologies.

With more than 40 educational sessions, the conference offered something for everyone. The overall feedback from session attendees was excellent. However, some vendors and attendees said that there was a lack of information about EDMS, workflow and imaging technologies in banking, except in the area of back-office operations (e.g. check and remittance processing). I interviewed more than two dozen bankers who attended BAI and at least a dozen vendors who exhibited.

David Loeffelmann of Mercantile Bank ($32 billion) of St. Louis said, "There is more to these emerging technologies than just check and remittance. I'm disappointed that BAI hasn't stepped up to bring education to us (the members) around the technologies application within other critical areas of the bank like lending, trust, investment services and retail banking. No one else is filling that space. AIIM (Association for Image and Information Management, www.aiim.org) addresses the technologies, but no one does from the banker's perspective."

Another attendee, Nancy Thornton of FileNet (www.filenet.com), said, "It's odd that out of 40-plus sessions only three even got near the subject of EDMS and workflow in other areas of banking. BAI needs to realize that EDMS, imaging and workflow technologies are now being addressed at enterprise levels by major players like Bank of America, Comerica, First Union and NationsBank, because institutions are realizing the enabling value they bring to the way they can do business better, faster, cheaper, with direct positive impact to their customers. Unfortunately, someone at BAI must have an archaic view of these technologies and doesn't realize that because of the knowledge management movement in banking, these technologies are becoming key elements."

Horace Allen, executive VP of Treasury Management for Crestar Bank ($23 billion) of Richmond, VA, explained, "We're about serving our customers with exceptional service at all levels and points of delivery. As a provider, we realize from the top down that these technologies provide us with the ability to deliver not only unparalleled customer care but also offer new value-based products such as our image-based cash management offerings. I must admit that I'm surprised that BAI hasn't taken on the role of being the knowledge provider outside of the transaction environment. No one's offering it other than AIIM, and they have been historically non-vertical specific. Within Crestar, our CIO, Bill Ginther, has an enterprise initiative underway developing our corporate road map to deploy EDMS, workflow and the like. That's one of the ways Crestar plans to maintain its leadership role in this market. These are critical technologies."

BAI's Brian Black addressed the institute's position by saying, "BAI sees that there is a need for a forum to supply EDMS, workflow and image technology knowledge to the banking community. We are currently in strategic planning for our next 18 months of conference programs and are addressing this need as part of our overall planning. Obviously, whatever we do either in partnership with someone like AIIM or alone, we will do it in the same high-caliber fashion as our other programs. To do so takes time, resources and planning. We want to do whatever serves our membership best."

AIIM has taken a proactive role in addressing the technologies of EDMS, workflow and imaging for the banking space. Most recently AIIM formed a vertical market member council to focus on delivering vertical market-specific knowledge to its financial services members.

According to Karen Carey, VP of membership for AIIM, "AIIM sees these technologies in high demand within the banking space, which represents a growing segment of our user membership base. Therefore, we feel that it is critical to supply knowledge and education to our constituents and to deliver the best horizontal expertise with vertical application. That is the intent of the member councils.

"AIIM would like to explore ways BAI and AIIM members can interface and exchange educational resources for the benefit of all involved in this important vertical industry," Carey added.

Perhaps BAI's leadership will hear the message and address those technologies with its own conference or partner with an organization like AIIM to deliver the best of both worlds. The next key BAI event--its "Graduate School in Bank Operations and Technology"--was scheduled for June 6 to 12, 1998, at Vanderbilt University in Nashville, TN. For more information about BAI and its conference offerings, visit www.bai.org. E-mail comments or suggestions to redwards@lhcg.com or bblack@bai.org.

Highlights from the BAI transaction conference

Eighteen months ago, I met Joe Knicely and Dick Zedecker of industry leader, NCR (www.ncr.com). The dynamic duo enthusiastically unfolded a strategy that was to place them on the map. Their intent was to put image POD vis-à-vis the ImageMark family of products into banking and transform what appeared to be a stagnant concept. Eighteen months later, I'm here to say they weren't kidding. Because of NCR, the entire world of transaction processing has image POD on the radar again. Primarily, because NCR did two key things:

It has allowed banks to deploy image POD at a significantly lower total cost of ownership without having to trash legacy deposit and transaction platforms, and it's used the deployment of image POD as an opportunity to rethink the entire work process.

It's employed new and innovative products like the document prep workstation, which aids the efficient document prep of check batches by magnetically sensing staples, paper clips and other metallic foreign objects that can jam or damage transports. Traditionally that has been a manual labor-intensive process--but an essential process to avoid lost time and damaged or even destroyed negotiables. A simple, non-sexy device delivers tremendous value in the overall scheme.

Continuing to demonstrate its position of leadership, NCR has struck strategic alliances with best-of-breed providers like U.S. Check Co. (Washington, DC), IA Corporation (www.iacorporation.com), and high-speed transport leader Unisys (www.unisys.com).

At BAI, NCR demonstrated all of the components of the "new banking architecture" that will allow all-image-based item processing by killing items at multiple points of entry and building electronic cash letters real time. NCR will capture once and at the source of entry into the bank.

The company uses a variety of image-capable devices in the ATM, kiosk, at the point of sale and teller stations. That transforms the traditional item processing shop into an exception-handling environment vs. a primary point of clearing. The result is faster check clearing, reduced handling and reduced cost of operation. Additionally, once image-enabled, the image proof operation can be virtually located anywhere.

The Smart Check that U.S. Check has developed and is marketing jointly with NCR has UV check technology that fraud-proofs the standard paper check. The technology paints zones on the check, which, along with marking codes, identify the type of field of entry. That aids in data collection and allows "snippets," such as just the payee line, to be captured from the check. Thus, we can know and verify the type of info within the zone, and by only capturing the "snippet," the file size is lower and the transmission speed is enhanced.

From a fraud perspective, if someone chemically washes the check to replace the existing data with fraudulent data, it is not only visible but flags the system. If the culprit attempts to erase and replace the data, again it is visible. Lastly, if someone attempts to copy a new check or desktop publish one, the image transport will recognize the absence of the UV elements and flag the system.

To round things out, NCR has built a complement of components to provide an image/object repository for checks, data warehousing and data mining capabilities, and a call center package to consolidate information and images at the CSR's desktop.

NCR customers with ImageMark POD include UMB Bank, Regions Bank, Wachovia, First American, Union Bank of California, Bank of New York and KeyCorp.

IA Corporation

Having stood steady through a barrage of sticks and stones from its competitors, IA (www.iacorporation.com) has continually demonstrated a will and commitment to deliver.

At BAI, IA announced several new offerings to its CheckVision line of software and its strategic marketing agreement with NCR to remarket its image archive and image account reconciliation product. Based on its CheckVision archive product, it announced the following: Advanced Positive Pay, Daily Item Delivery, Fax Delivery and Exception Item Processing. All four are designed to enhance the functionality of the CheckVision product line and offer client value.

BancTec

Coming into the Transaction Conference, BancTec (www.banctec.com) had a lot to sound off about. Having just announced that NationsBank had selected BancTec as its enterprise check archive solution, the company had room to strut.

At the conference, BancTec was showing its:

  • 9500R document imaging workstation for remittance, lockbox and item processing

  • ImageFirst Transaction Processing System

  • ImageFirst CD Production and Distribution Module

  • ImageFirst OpenArchive System

  • ImageView Image Access Application Software

  • ImageFirst Office Document Imaging and Management Software

  • S-Series of scalable high-speed document scanners

  • E-Series of high-speed image transports.

Wheb Systems

Wheb Systems (www.whebsys.com) and Wausau Financial (www.wausaufs.com) have teamed up to provide more document-centric processing capabilities within the payment processing industry, leveraging the high-speed transaction processing capabilities of Wausau's ImageRPS with Wheb's Intelligent Forms Processing System. The functionality provided by that tag team should allow users more capability to deal with and more value from forms submitted during the remittance process. That could be especially valuable within wholesale or customized lockbox operations such as fulfillment, data collections or reconciliation. Typically manually processed, the information can be managed automatically providing services cheaper and faster than traditional methods.

IBM (www.ibm.com) and Check Solutions (www.checksol.com) announced they will provide one check solutions group. IBM will continue to manufacture hardware, provide engineering and maintenance. IBM Global Solutions will provide systems integration, and Check Solutions will provide consulting, design and software solutions for check processing environments.

StorageTek (www.storagetek.com) announced its check image archive solution featuring its hierarchical storage management product and its line of high-density magnetic tape silos. In collaboration with IA, StorageTek has completed installation of an image archive system for Comerica Bank (Detroit).

PenOp (www.penop.com) demonstrated that its signature capture system provides signature input and validation, as well as security. Using biometrics algorithms, PenOp registers the original signature and its related biometrics signature patterns. Thus, in the process of authorization it validates (using a confidence-based voting algorithm) the authenticity of the signing party. The system also allows user-defined restrictions, which govern changes, additions and deletions once a signature using the system has been applied to the document. Currently, PenOp features integration with JetForm, Documentum, PC Docs, Netscape Navigator and Adobe Acrobat.


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