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Main / What We're Doing Weblog

Demographics is destiny, and in this article, my colleague Marianne Kolbasuk McGee from InformationWeek lays out the undeniable facts: we're all getting older.

I believe that those of us in the information technology business tend to have a keener sense of our own mortality. We're constantly dealing with "end-of-life" software and hardware. We struggle to support legacy systems that creak along until they're put to pasture, replaced by the latest and greatest tools that are no sooner installed than they become legacy systems in their own right. We watch as our once-proud hardware runs out of memory and struggles to perform the most basic tasks. And we also conceive of new systems, nurture them along until they're sustainable, and send them out into the world to earn a living.

With the retirement of the Baby Boomers, the first generation to manage the integration of global business and information technology will no longer act as caretakers to the national IT infrastructure. Instead, they'll be booking times at the local golf course. This poses an unique challenge for financial services organizations that depend upon these people, not just because they possess a certain skill set, but because they share -- and helped to define -- the industry's goals and values.

Fortunately, there are ways that the older generation can transmit knowledge to the younger generation, and Bank Systems & Technology can be part of that process. Specifically, what are all the retired bankers going to do after they're done gardening and golfing? They're going to surf the Web, and they're going to want to hold forth on whatever they know, to whomever will listen. And we're here to provide that forum.

Personally, in my role as commentator on banking technology, I see retirees as my number one competitive threat. Let's face it: I have a good command of the English language, I'm fairly prolific and I understand how the financial system works, but I've never worked for a bank and my hands-on tech experience has been limited to helping run a medium-size business, not a megabank. Soon, people in my position will be competing for bylines with a bunch of bored pensioners having 40 years of experience at big banks.

It's time for me to move along and make room for the "next generation."

This has been my last month on the editorial staff of Bank Systems & Technology. I have accepted a position as Technical Analyst with BS&T's parent company, CMP Media, acting as a liaison between the business users and the IT group. This is a chance to apply the lessons I've learned from writing about financial services: finding efficiencies in manufacturing, creating multi-channel distribution, implementing know-your-customer practices throughout the organization, and achieving competitive advantage through the successful management of technology.

I've learned from the best. Thank you.

Check out my special News Show preview of Firewall: The Movie, which is Hollywood's take on what you do for a living.

Since September 2005, the three major consumer credit reporting agencies have been required to provide upon request free annual credit reports. So, to see what the agencies have on record, I sent many of my personally-identifying characteristics through a secure Internet connection in exchange for comprehensive reports from Equifax, Experian and TransUnion.

Back in business school, on my first day of the required Marketing class, the professor put a slide up on the board that said something to the effect of: "More of today's CEOs have risen to the top through the marketing function than from any other area of business."

Of course, hyping one's own field of interest is something you'd certanly expect a marketing professor to do. Nevertheless, the slide made an impression. Was there something about Marketing, compared to Finance, Operations or anything else, that generates leaders?

Or is there some other explanation?

This week's newsletter has a story on Wachovia's implementation of remote deposit capture (RDC).

In it, we revisit the debate over whether RDC is best done using thick-client or a thin-client software. Given the obvious benefits of the software and the competitive need for it, what's your take on the relative merits of the two approaches? Or does it matter?

Please leave your comments on this blog entry.

Just finished the CIO issue. Hope all of you enjoy it.

Earlier this week, I attended the Global Grid Forum.

From The News Show, here's part one and part two of my interview with the Chairman of GGF, Mark Linesch.

I also attended a session concerning Bank of America's grid implementation.

Yesterday's webcast on the implications of the release of data under the Home Mortgage Disclosure Act ("HMDA") was quite a success.

Although the intent of HMDA was to provide transparency on lending practices, perhaps its most significant effect will stem from the ability for mortgage lenders to use this as a new source of competitive data on 8,853 financial institutions. The data includes information on loan pricing and the type of loan (e.g. loans for manufactured housing, loans secured by first or subordinate liens, unsecured loans). If you're considering an acquisition, HMDA may prove to be an interesting source of due diligence data.

It seems that the only place where the data won't really have a definitive impact is in assessing whether a lender discriminates. In its Sept. 27 Financial Services Alert, Goodwin Proctor LLP writes:

The FFIEC emphasized in its press release that the HMDA data are not, by themselves, a basis for definitive conclusions regarding whther a lender discriminates unlawfully against particular borrowers or takes unfair advantage of them.

...

As a result, the FFIEC cautioned that conclusions from the HMDA data alone run the risk of being unsound, which in turn may reduce the data's effectiveness in promoting HMDA's objectives.

Write to me at ischneider@cmp.com if you have any additional perspectives on this topic.

Oh yes, and do watch the webcast:
Behind the Data: What Every Bank Should Know About HMDA.