all2ponder

NCR changing dynamics in DVD rental marketplace

2009-06-05T00:37:00.000-07:00

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JUNE 1 | ATM-making giant NCR has tapped Alex Camara, a former executive with Redbox parent Coinstar, to head its movie-rental kiosk-development efforts with Blockbuster.

Camara, who was most recently general manager of Coinstar’s coin and entertainment unit, will be VP and general manager of NCR’s entertainment solutions division, NCR said in a statement today. Camara had been with Coinstar for 10 years.

Camara will oversee a partnership formed last year between NCR and Blockbuster to build Blockbuster Express kiosks and close the gap with kiosk leader Redbox in the rapidly-growing self-service DVD market. U.S. rental revenue from kiosks is expected to more than double between 2008 and 2011 to $1 billion, while traditional in-store sales are expected to fall during the same period, Adams Media Research said in March.

In April, NCR agreed to acquire the majority stake in movie-rental kiosk operator TNR Holdings, which will speed up its kiosk-making partnership with Blockbuster, the largest U.S. movie-rental chain. Blockbuster CEO Jim Keyes has estimated that the partnership will produce 3,000 kiosks by the end of the year and 10,000 by the end of 2010.

Earlier this year, Coinstar bought the 49% of Redbox that it didn’t already own for about $175 million in cash and stock. Last month, Coinstar said Redbox’s first-quarter sales more than doubled from a year earlier, and it was on track to almost double its machine count to as many as 22,000 this year.

Birthday Card for Goomsie - Gautam Thakkar

2008-08-23T11:46:00.001-07:00

Make a Smilebox postcard

Birthday Card for Goomsie - Gautam Thakkar

2008-08-23T11:46:00.000-07:00

Make a Smilebox postcard

Indian SOX - Clause 49

2006-06-02T05:51:00.000-07:00

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India Inc warms up to Clause 49
NEW DELHI:
India Inc appears to have taken the new corporate governance norms under Clause 49 much more positively compared to their counterparts in the US where Sarbanes Oxley (SOX) Act was brought into the picture in 2002, according to a Grant Thornton survey.

The survey revealed out that while half of corporate India was undecided if the new norms have benefited their organisation, a significant 45% indicated of that it did benefit them. The survey, which was conducted after the deadline for implementing the new norms ran out on April 15, brought out that a significant proportion of the respondents indicated that they benefited from improved processes, controls and enhanced awareness of risks.

This apart, 56% of the respondents also mentioned increased investor community perception on corporate governance as a benefit derived from compliance with the revised Clause 49. However, the views were divided on the issue of differential norms with companies having lower market capitalisation getting an extended deadline for compliance as in the SOX Act.

Currently, Clause 49 is applicable to all companies seeking listing for the first time, seeking in-principle approval for such a listing and all existing listed companies which have had a paid up capital of Rs 3 crore and above or net worth of Rs 25 crore or more at any point of time in its existence.

The survey also brought out that majority of small and medium size companies are driving the compliance process which includes areas like process documentation, identification of risks and controls, internally.

Given the differences in responses, it appears that larger companies have relied more on outsourcing some of the processes like controls assessments, compliance framework and assessments, while smaller organisation — where the impact of compliance costs can be higher — depended on internal mechanism hence cutting additional costs.

When queried on the views related to further extension of the deadline for compliance to the new norms, the verdict was a clear, no. Majority (54%) of the respondents were not in favour of further extensions and only 20% felt that it should be extended.

But what is the perception with respect to the success factor of Clause 49? According to Grant Thornton, “From our survey there is no clear mandate on whether Clause 49 has been a success in terms of achieving its objectives. The verdict was hung with 54% of the respondents remaining undecided, while 34% of them believed that the exercise was a success. It is still early days and much will depend on the actions taken by Sebi on companies who would fail the acid tests of compliance.”

On the issue of effective mechanism to facilitate compliance, respondents indicated their preference for FAQs by Sebi, or a combination of initiatives such as FAQs. Sebi hotline for compliance issues and an implementation facilitation agency on the lines of Public Company Accounting Oversight Board in the US.

HAPPY DEEPAWALI and Happy NEW YEAR (2062)

2005-11-06T08:52:00.000-08:00

Wish You and Your Family
Very Happy Deepawali
andVery Happy New Year (2062)

..........From Hitesh and His Family

Let us celebrate instance
of human's inner-self enlighten
over the darkness of his ignorance.

Deepawali
is a

Festival of Light......
Festival of Guru

(Sanskrit meaning of 'Gu' means Darkness and "ru" means removal - Finding Guru who can help you in removing darkness of ignorance).

You can remain in touch with me by visiting my blog:
Touchpoints - http://365-24-7.blogspot.com

2005-07-26T02:24:00.000-07:00

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Hi Friends,

It is quite some time that, I have not blogged. I had gone through a learning cycle of life. I come across stock market dynamics and various market technologies for quite last three months.

I learned and start tracking market dynamics, market players, market health and strength and weakness of various market leaders across the globe. I would like to share some good links and fanastic article wrapping up last one decade market happenings in concise words.

I learned lot from INVESOPEDIA - One of the oldest and reliable source of online tutorial. I learned lot from this encylopedia for last three months.

I would like to share article from e-McKinsey on Leadership's role in Capital Market. Excerpt of same is given below. For Full article, please visit the e-Mckinsey Web site (You might need registration)..

Building world-class capital markets -

- Ralph Heidrich, Alan W. Morgan, and Gregory P. Wilson

The McKinsey Quarterly, Web exclusive, July 2005

How can a nation transform its capital market into a dynamic, wealth-creating engine for the economy or even into a financial hub?

Vital components for this effort include patient reputation building, high performance standards, a resilient infrastructure, and a robust regulatory framework. But in our experience, vision, political commitment, and, above all, leadership make the real difference between success and failure. Just as those factors frequently determine the outcome of a corporate change initiative, so national efforts to build or improve capital markets bear fruit only when someone, or perhaps a group of people, articulates the need for reform and implements a carefully structured program.

Too few countries, however, are capturing the value from this opportunity. We believe that many more of them can share in the wider economic benefits of a transformed capital market—if they can exhibit the sort of determined leadership underpinning current reform in nations as diverse as Singapore, Malaysia, and Saudi Arabia.

Please do drop a comment on your views as they are valuable to all of us.

---- Hitesh

Munch or Byte: Five Nine Realities in IT Management

2005-02-08T04:07:00.000-08:00

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If you are IT Manager,CIO or head of IT department and sincere enough to talk to business users management terms like "Availability", "Relability", "Business continuity" are common terms that, business users will throw at you in high pace drama meeting.

I am sure, first time when u started discussing with these high tech monkeys, you would have literally given class to define it in right persecptive. I think it's still necessary to re-iterate literal theoratical meaning and interpreteation behind it.

I feel you must read article Gary Audin - president of Delphi inc. in Business Communication Review about defining "five nines" and understanding it's implementation in practical world. Example given is more Telecom oriented but, same hold true for other IT systems also.

Must Read if you Buy or Planning to Buy ONLINE

2005-01-19T08:13:00.000-08:00

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This page is BEST viewed in FireFox Browser. Get your self one and enjoy it.

In Part I of Welcome to the Jungle: The Two Sides of eBay, we examined the scope of eBay's market dominance and the realities of running a business on the auction giant's site. This week, we delve deeper into pricing your items to sell, the bidding process, the importance of positive feedback and payment processing.

eBay founder Pierre Omidyar started the site as a means to sell his Pez dispenser collection online. Today, collectibles remain the most popular top-level category on eBay, accounting for 17 percent of all items offered, according to the Auction Software Review. However, Clothing, and Entertainment follow at 11 percent each, with Sports, Home, Jewelry and Watches, Computer and Electronics, Toys and Hobbies and Books all coming in at 5 percent or higher - much of it new, non-collectible merchandise. Bear in mind we are talking percentages of a very large pie. For instance, "Business and Industrial" items garner just one percent of the total items offered on the site, yet, there are over two hundred thousand auctions in this category at any one time.

Given the astronomical amount of items up for auction at any given time, however, there are no guarantees your items will sell.

Auctions: The Dark Side of Paradise

The cold reality is that 53 percent of eBay auctions end without a bid, another 23 percent sell with just a single bid. Re-listed items often sell on the second try; (not all of eBay's users search at one time,) but meanwhile listing fees keep adding up, cutting into profits. Further, with 25 million auctions running, sellers need any edge they can get to make their needles visible in this huge haystack.

A good starting point is research. eBay allows searches of past performance sales in all categories. This the best starting point for establishing the pricing prospects for your merchandise. Further, if you are selling a collectible, eBay has no less than 743 separate collector groups or chat rooms. Under "Buttons and Textiles" for instance, these range from Cutey Pie Threads with one lonesome member, to Button Buddies with 279. By perusing a group you can find what niche collectors are looking for, their complaints, attitudes, and needs before marketing auctions to these target buyers. There are also group forums for selling any imaginable (and some unimaginable,) products, as well as marketing strategies, such as the One Cent Wonder group who glory in starting auctions at one cent. Preliminary research of past sales and within the groups will save time and pay dividends down the road.

Keywords

A majority of buyers find what they are looking for with keyword searches. It is critically important to fill the fifty-five character heading with the proper keywords to attract niche buyers for your item--as well as attract the potential buyers who do serendipitous searches through all the listings. By default, the eBay search is set to the title headline only, but many buyers will turn off the default and search by auction header and item description. So it is important to also pack your description with as many keywords as possible. For instance: if you are selling a signed Mahalia Jackson program from the Brooklyn Academy of Music, you want to feature the word "Brooklyn" in your header and description, since there are many more Brooklyn collectors than gospel singer or Mahalia Jackson devotees.

The Pricing Quandary: The $1 minimum versus retail.

There are two schools of thought regarding opening bid pricing on eBay. Many, perhaps a majority of sellers, will purposely start an item's bidding at a price far below the item's value in order to attract bidders seeking a bargain, and/or (dream of dreams,) engender a bidding war on the item. Sellers that know they are offering a desirable item, realize the item will rise to its price regardless of its dollar stating point. Of course, the downside is that this might not happen - due to sniping software and other factors, and the seller will find his $200 book selling for $4.99. Sellers who have been too often burned by this opt to start the minimum bid at or near a price they are willing to accept. This tends to slow down the bidding but at least guarantees that you do not lose money on the sale of an item that can still be sold for retail in a brick & mortar store or an off-eBay web site. A good rule of thumb is to rely on experience: start out protecting your sales until you feel certain you know the market, then start the sale low and wait.

To Bail Out or Tough It Out

Watching bids accumulate on your auctions is not unlike watching grass grow. Years ago, bidders would plunge into anything they wanted from the opening bell; however, today eBayers are far more savvy: rather than running up the price with early bids, most wait for the last day, frequently the last few minutes, before bidding.

eBay pretty much allows sellers to cancel bids and auctions at any time. Because so much of the action occurs on the last day, this is not a good idea. The seller is better served by making a firm decision on selling before initiating the sale and sticking with it.

To Reserve or not to Reserve

The way the reserve auction works is that the item will not be sold unless the hidden reserve price is reached. eBay charges a fee for reserve auctions; the fee is reimbursed only if the item reaches its reserve. Some sellers who offer high-ticket items use the Reserve Price auction while simultaneously starting the sale with a low minimum bid to attract interest. The problem with this is that reserve auctions tend to turn off bidders who want to know their participating in an absolute sale. Most sellers avoid reserve auctions except with a high ticket item that they feel will reach its reserve, but want insurance in case it does not.

Find the Right Slot.

Selecting the right category to place your auction can make the difference between success and failure. There are hundreds of categories and sub categories on the site; unless the item has a clear cut slot, such as a new digital camera, or a used BMW, the choices can be perplexing. Some sellers use several categories on items of crossover interest, but each extra category doubles the listing fee. It is a good idea to use a hidden counter system that tracks the number of hits on your sale; several hosting services, such as Andale, offer them for free. If you see that your sale is garnering few hits in a certain category, try changing categories. If completely bewildered, run a search for similar items and see where their sellers list them. Auction duration: eBay allows one- , three- , five- , seven- and ten-days auctions. The majority of sales run seven days, with the ten-day sale (which incurs a small extra fee) the second choice. Besides the extra exposure, a ten-day sale allows the seller to show his item over two weekends when buyer activity is at its peak. Start ten day sales between Wednesday and Friday to catch part or all of two weekends.

eBay as a crapshoot

Only a fraction of eBay's 114 million users surf the site at any one time. eBay has its hardcore steady users, but many eBayers surf and buy as time or money allows, and then in fits and spurts of several weeks or months. Routinely, items that fail to attract a bid on the first or even a second try, will sell, sometimes with multiple bids, in the next listing. (From personal experience auctioning used books on eBay, about 40 percent of re-listed items sell on the second try.) eBay sends a re-listing link with your auction result email and will reimburse the re-listing fee if the item sells. But before re-listing an item, consider adjusting the price, description, or category(s) for the second try, and wait a week or longer before re launching the sale in order to attract 'fresh blood' to the audience.

No Surprises

According to WebTrends, 35 percent of U.S. adults say "surprise costs" will lead them to abandon an online sale. eBay buyers resent high shipping charges; it can make the difference between repeat business and never seeing the buyer again. If possible, state the items shipping charge on the sale; in any case, it's better to keep shipping at cost and view the "handling" as part of the price of doing business. The goodwill makes it well worthwhile.

Make Nice

A combative attitude and negative feedbacks are poison on eBay. High maintenance and distrustful bidders come with the territory - seller fraud on the site is such that eBay employs eight hundred people to root it out. There is also the nuclear deterrent Feedback Rating System wherein buyers and sellers rate transactions as "positive," "neutral" or "negative."

Buyers gravitate to sellers with excellent feedback ratings and tend to eschew those with negatives. Most negative feedback is avoidable with good, polite e-mail communication, patience, honest descriptions and timely shipping. It's advisable to avoid handing out negatives loosely as the other party is free to respond in kind. Even with renegers, the seller is better served by claiming a closing fee credit, issuing a bidder "strike" against the reneger (three strikes and the user is kicked off eBay,) and either offering the item to the under bidder or re-listing it rather than issuing a 'negative' which can be reciprocated PayPal In the past, horror stories abounded among sellers who had their funds wrongly frozen, misapplied or lost in PayPal's twilight zone - to the point where a successful class action suit was just concluded against the service. Purchased by eBay several years ago, PayPal has been 'stabilized,' and with 50 million users, it is the benchmark of online payment services.

Considerably more cost efficient than online credit card processing, its convenience makes it the favorite payment method among eBay users. Small to medium auction sellers (several to fifty sales a week,) can expect to lose a few sales for not having PayPal. For larger venders with a hundred or more weekly sales it's a necessity. The service also takes much of the pain out of international sales--which you'll want to consider.

Over There

International buyers are an increasingly large segment of the eBay auction market. Sell internationally. But particularly if you do not offer PayPal, protect your self by using the "Ship to U.S. only" eBay option. Few overseas buyers will be put off by this. If a buyer wants what your selling, they will e-mail to ask if you will ship to a foreign destination, or, just as often, ignore or not even read the terms & bid anyway. In either case, this option gives the seller important leverage: if the buyer refuses the shipping costs, terms, or offers payment that will incur a conversion charge, the seller can cancel the sale without risk of receiving a negative feedback. (eBay removes negative feedbacks placed by international buyers when the sale stated "ship to US only.") International sales require customs forms and usually extra emails, but if you turn away from this market, you will be leaving money on the table.

Jump in

This has been intended as a very general guide to entering the eBay market. There are many other nuances to selling on eBay--depending on the product you sell, your goals, the time you can put into the effort-- that will become apparent with experience. eBay is not for everyone. If you intend to tippy-toe into eBay as a hobby, avocation, or source for side income, it's advised that you begin in the auction format, try it and discover if this venue is your 'cup of tea' before investing the expenditure of time and effort required for establishing a Store. For large volume sellers, segueing into eBay Stores is a natural transition that makes good sense once an auction following has been established. Have fun, make money.

Jan 2005: Stage set for Global Core Banking Competition

2005-01-14T06:11:00.000-08:00

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In late 2004, when Misys announced its MidasPlus product, an enhancement of its 20-year old Midas core banking product, the company’s CEO for wholesale banking, Andrew White, claimed to have achieved an edge in the area of “global processing” vis-à-vis its competition – a claim that has been challenged by other core banking stalwarts such as i-flex and Temenos.

“Global processing” – the standardization of processes in a single, central, integrated worldwide system, eliminates duplication of efforts and yet facilitates flexibility in back-office operations. It is today an often-spouted catchphrase among core banking solution providers, hoping to take advantage of the lucrative returns of even a single deal with any international bank.
i-flex responded to Misys’ claim by pointing at its installed base at various international banks like Citibank, Lloyds TSB, Rabobank, UBS and Shinsei Bank. Temenos for its part said it had “years of experience in providing its clients with this competitive advantage” via its TEMENOS GLOBUS and with “the non-stop processing capabilities of TEMENOS 24, our clients can harness the real power of global business.”

Misys plans to upgrade its entire installed base of Midas customers to MidasPlus. Andrew White says: “At some point in the future there will be a point where Midas no longer exists and everything is MidasPlus. MidasPlus is everything about consolidation at the back office, with keeping your front office in separate branches.”

According to Misys, MidasPlus, will allow a bank to consolidate its operations and provide a single view of its global business, across transaction processing, treasury, capital markets, commercial lending, trade finance, payments and retail services.

White compares the previous Midas installation to a hub and spoke situation, where the Midas installations were at the spokes, but “the hub was the country’s home territory and Midas seldom went in there.” The obstacle that Misys encountered was essentially one of consolidation, given different local banking laws and regulations. The MidasPlus product is intended to address this and move into “the centre of large banking operations”.

All three products – Misys’ MidasPlus, Temenos’ T24 and i-flex’s FLEXCUBE tout J2EE support, a Java-based platform used for deploying and managing applications on an enterprise-wide scale – an inevitable criteria of products, the result of banks themselves moving towards J2EE.

Point to Ponder:

1. Where is INFOSYS's Finnacle placed against such biggies ??

2. Three Tiered Service companies like HP,IBM, EDS, Accenture are tier 1 players with TCS having his leg tight in Tier 1 player. Tier 2 vendors are considered Virtusua, INFOSYS, iFlex, Polaris, NIIT etc. and Tier 3 are small scale vendors like iGate, KPIT, MasTek and few such mid cap companies who are suppose to create good pedegree in market by winning big ticket wins.

3. Are this guys right in their approach towards marketplace? I feel few lack their delivery model which are outdated and rigid for marketplace. I feel they need to enhance their service delivery methdology.

4. I feel their is lot to be done by Functional and business analyst stuffing their big brains behind ARmani Suites. They need to take up the global level compliance issues like SOX,Check21 and BASEL II. This compliance are usually expanses and does not show up ROI thus, ignored by banks as well as not on the selling list of these analysts. These analyst are the one who can show them the writing on the wall for loosing competitive advantages in market place. McKinsey and PwC has better capabilities and they can partner with Tier 2 or Tier 3 companies to team up and grab the market together with dual edge sword of Business as well as Technology Excellance ANY TAKERS?????

10 Golden Rules for Online Shopping Players

2005-01-13T05:37:00.000-08:00

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Since 1997, e-commerce consultancy the E-Tailing Group has been buying products from 100 web sites a year. The Chicago-based firm records and tabulates the results of its shopping experience, using the data to help them advise clients and set e-commerce benchmarks.

Each year, the firm's so-called "Mystery Shopping" project investigates many aspects of 100 top e-tailers. The sites themselves don't know they're being tested; yet they get a complete diagnostic check-up. "We're just an average customer. We use the shopping cart, we order the product, we e-mail the site, and we return the product," explains Lauren Freedman, the firm's president.

The test e-mail, for instance, discovers how quickly and accurately a site responds to customer queries. The return process, too, is checked for glitches. "We also test live chat — as things evolve on the Net, we add things," Freedman notes.

To take a look at the firm's research, go here.
For example, among the sites put to the test, here what's the company found:

93 percent offered free shipping with a price barrier
68 percent offered real-time inventory updates
70 percent answered their e-mail correctly
16 percent required authorization for a return
8 percent offered the capability to shop in a second language

(Final results for the 2004 holiday season will be posted by the end of January.)

Above was the statstical observation, on top of it, analyst came up with fantastic guidelines which is published as "10 golden Rules for Online Shopping players".

It's result of the experiences, they had of purchasing hundreds of products online and visting the sites and recording the interaction experience.

Visit for the complete coverage of these golder Rules.

BEFORE Visiting above why don't you drop valuable comment.

The anti-money laundering dilemma

2005-01-12T02:15:00.000-08:00

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While fraudsters and money laun-derers have been innovative in adapting their techniques over the years, the technology approaches by banks have unfortunately not been as innovative. These approaches have often been limited to manual inspection of records or programming systems to flag out transactions above a certain amount - a fact borne out during interviews with regional banks.

For example, the IT head of a tier 1 bank in Taiwan concedes: “We don’t check the background of our individuals. We write programs as part of our core banking applications to flag out transactions above one million NT and above, and also to calculate if the sum of transactions are over one million NT and we report such instances to our HQ and financial department."

The IT head added that its current monitoring primarily focused on transaction amounts and suspicious individuals. The bank revealed that its applications for monitoring are primarily in-house developed.

Expectably, the global banks seem to be more diligent in this area, thanks to their more global nature of their risk exposure. HSBC Brunei’s manager for technical services, Silvia Chong highlighted that the bank utilizes a mix of in-house developed and third party applications. She emphasizes that technology plays a critical role in it: “Technology does help a lot – because we have automated systems to filter out (irrelevant) information and highlight the required information that we want to see.”

Chong revealed that besides transaction amounts, frequencies and monitoring against a list of suspicious individuals, HSBC’s methods also included monitoring transactions from high-risk countries and classifying customers.

An ROI question
One solution provider expressed a fundamental dilemma impeding banks: “When you have projects like CRM, which deliver returns on investment…. if the regulators are not going to penalize you (for system deficiencies in detecting laundering), you won’t rush off to do compliance first.”

"No country wants to be known as the country to launder money."

- Clare Hart, Factiva's president & CEO

This individual pointed out that with many of the money laundering scandals across Asia, the focus had often been on catching and punishing the money launderer himself, rather than turning a critical eye on the systems and infrastructures in place at target banks.

However, the increasing occurrence of money laundering, regulatory push in the form of the Patriot Act and Sarbanes-Oxley and the huge cost of reputation risk in the face of banks’ efforts to IPO are pressuring Asia financial institutions to accumulate data on suspicious individuals and transactions more judiciously. Organisations such as World-Check and Factiva are seizing the opportunities here. Both organizations provide profiles of high risk and potential high risk persons, such as politicians, terrorists, and other individuals linked to fraud, organized crime and laundering.

Factiva’s CEO Clare Hart says: “No country wants to be known as the country to launder money. Let’s face it, because there are too many risks associated with that from an investment perspective. I think the regulatory environment has actually helped us quite a bit with. Bad behaviour is really helping us.”

Factiva leverages its archives of news reports, to provide a product called ‘public figures and associates’, a database which the company claims includes 350,000 politically exposed persons, and a further 100,000 of their relatives, friends or close aides. The database also includes a black list of 4,600 individuals that financial institutions are barred from doing business with, under the advice of national regulators or international bodies.

According to Hart, “Public figures and associates was in direct response to European banks coming to Factiva, who already had strong relationships with us… these bankers came to Factiva because for compliance purposes, they needed to have database of information about people, and at one point, they were looking at building their own database amongst themselves and decided that this (public figures and associates) fits right into their strategies.”

Asia’s track record
Asian banks are under the spotlight today. Three out of the six “non-cooperative countries and territories” identified by Financial Action Task Force, an inter-governmental body against money laundering and terrorist financing, are in Asia – Indonesia, Philippines and Myanmar. Generally, Asian banks have not had a good track record in money laundering, thanks in part to the fact that they have not faced the same sanctions as European and North American banks do for negligence in this area.

"Software solutions must be one step ahead of the evolving techniques that money launderers use.

However, Simon Alterman, vice-president of content for information company Factiva, believes that this is changing: “Over the last year or so there has been a real change of pace in the Asia Pacific region as far as compliance issues are concerned… when we started to do this years ago, it was almost impossible to get their attention.”

Staying one step ahead
However, Leong Mun Tong, Asia Pacific sales director for financial services at Mantas, which specializes in behaviour detection software, says that many monitoring systems across banks in the region continue to utilize a rule-based approach, engineered to detect actual fraud rather than suspicious patterns of behaviour.
He adds: “Neither viral or money laundering pattern is static. The money launderer is going to get smarter and smarter to avoid detection. So, software solutions must be one step ahead of the evolving techniques that money launderers use.”
Yet another challenge is in knowing the various money laundering patterns to look for. Leong elaborates: “For example, what constitutes suspicious behaviour and how do you identify them in a sea of data that is made up of complex customer relationships, diverse monetary instruments, transaction channels and international reach?

Lesson No. 1 for CIO - Build Right Skills

2005-01-11T23:50:00.000-08:00

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It's been clear for some time that being a successful CIO has less to do with technology than it does with being a business leader. Oct. 2004, Survey bears that out. The top three personal skills needed for success cited by the more than 500 IT chiefs who responded are:

Effective communication (chosen by 86 percent)
Strategic thinking and planning (72 percent)
Understanding business processes and operations (71 percent).
Rated at the bottom: technical proficiency.

Successful CIOs have outlined their strategic roles and claim (or in many cases, reclaim) their seats at the executive table by running IT like a business. CIOs establish themselves as corporate leaders and better forge alliances with their business-side peers. few more challenges CIOs have are how to deal with those annoying phishing scams and how to handle the even more difficult challenge of Sarbanes-Oxley compliance.

For all those CIOs struggling to get board room entry and luncheon with top cream of organisation, roll your sleeves and start working on learning or relearning above lesson.

If u like above, drop a word as your valuable comments....

Two Sides of Coin - Online Shopping and Auction (eBAY)

2005-01-10T01:38:00.000-08:00

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Does online shopping and online auction can fetch good numbers for you in 2005? Yes, if you are retailer, stockist or wholesaler and have pain managing your inventory, look at Ebay kind of auction and online shopping option in your business strategy for 2005.

Why? Look at the some of the statistics of 2004:
eBay has six times more users than its closest rival, Yahoo!, and other auction alternatives do not even bear comparison.In January, 2004, an average of 19 million items were available for sale on eBay. Today, the number is 25 million. The site registers 2,000 to 3,000 new users daily. This is on top of the 114 million current eBay users worldwide, 90 percent of whom are buyers. In short, eBay compels small businesses to establish a presence.

Is It Too Late to Get in the eBay Game?
eBay claims that 430,000 people earn a living on the site, mostly small business owners and individuals. Few sellers are having their own online shopping sites or brick and mortar outlets but, still few sellers employ full time employees to monitor and host several auctions and sales item behalf of one timers.

Auctions Versus Stores
The eBay world breaks down into two hemispheres: the auction sales for which its best-known and fixed price venues that include eBay Stores and the Half.com subsidiary. eBay announced the closing of Half.com in July. However, by October, when Half.com sellers failed to move to the Stores in sufficient numbers, eBay reprieved Half.com from death row. However, besides its being a discount venue, Half.com's future remains nebulous at best.

Innovative Way of Generating more Sale:
In addition to an eBay Stores and Half.com, there has been a fixed-price alternative within the auction format since 2000: the Buy It Now option. For a fee, sellers can post a Buy It Now alternative price on their auction sales. Once a buyer places a bid on the item the Buy It Now feature vanishes, and the bidding continues in the auction format. Conversely, if the item sells at the Buy It Now price, the auction ends and the seller must start a new auction to sell duplicate stock.

According to analysts who cover eBay, fixed price sales in the eBay Stores, Half.com and the Buy It Now auction formats account for 29 percent of "gross merchandise volume" (not to be confused with revenues generated) on eBay. But Buy It Now works best with commodities and products so common that the lowest price item is usually what sells. For anyone seeking to sell at retail, eBay Stores can be viable alternative to the site's auctions. The advantages of establishing an eBay Store include the following:

The individual item listing fees are considerably less expensive than the auction format, and they last longer. The basic Store fee is $10 per month plus a two-cents-per-item fee per month, and items can be listed indefinitely. Auction listing fees begin at 35 cents-per-item-per category on sales that can run for up to ten days. (However, the Store closing fees are the same as for the eBay auction format.)
Store sellers get a link on their auction pages leading potential buyers to their Store.
Stores allow cross promotion. Store sellers can show four other Store items in their auction listings that are linked to their stores. For example, you could offer higher-priced products, similar items to what sold or accessories to the sale item. All bidders and buyers see this graphic on the auction sale and Store pages.
Sellers can customize their Store's graphics, colors and product presentation.
Unlike auctions, Stores come with a search box, allowing buyers to search the seller's complete inventory — the only such individual seller search option on eBay.
Stores are a "fix it and forget it" venue. Auctions, particularly for sellers marketing one-of-a-kind-merchandise, are time-consuming to create and maintain.

The Downside of Establishing an eBay Store
It you are looking to run a business on eBay, an eBay Store may seem like a logical place to start. In fact, eBay offers the first month of Store listings free while proclaiming that Stores can increase a seller's sales by 25 percent — after three months. Neither the offer nor the info is good news. The reason here is that the stores lag far behind the auction venue in generating income. Sellers know it, and eBay knows it.

eBay users are auction-oriented. eBay's claim of a best-case scenario 25 percent increase in sales acknowledges that sellers will still accrue 75 percent of their sales in the auction format. (There are 25 million auction items compared to, perhaps, two-to-three million items for sale in the Stores.) More telling is the "after three months" asterisk proviso, which shows that buyers wander into Stores at a slow pace — most often only after establishing buying relationships from the seller's auctions.

Just as an independent Web site will be lost on the Web without good search engine placement, an eBay Store will remain a lonely place until the seller attracts a following of buyers he can steer into his Store. In short, auctions are the most viable starting point for entering the eBay market.

Now for the hard part: How do you ensure you are getting the most from your eBay auction presence? Wait for a while

Help ..Help.....Help..........Child Victim of Tsunami

2005-01-06T10:18:00.000-08:00

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This child has missed its parents in the Tsunami incident. just keep passing this, somewhere this child's parents might come to know the whereabouts of this child

Please send this to everyoneman you know, as we don’t have anything to lose. Atleast the boy might regain his family! (Thus decided to post on blog also)

Looking for his family.
The boy about 2 years, from Khoa Lak is missing his parents. Nobody knows what country he comes from. If anyboy known him please contact us by
phone 076-249400-4 ext. 1336, 1339 or e- mail : info@phuket-inter-hospital.co.th

Commerical Impact of Weak Security

2005-01-04T21:40:00.000-08:00

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While a well-implemented and widely accepted service that allows shoppers to move from store to store without having to register with each separately could be a boon to e-commerce, experts agree that Microsoft's security issues have left users hesitant.

In a notice released late Wednesday, eBay said members will have to sign in through eBay directly starting in late January.

"Once this takes place, the Microsoft Passport button that is currently displayed on Sign In pages will be replaced with links to a page with more information, including Help in case you cannot remember your User ID or password," the notice said.

eBay also said it will discontinue sending eBay Notifications through Microsoft .NET alerts, and recommended that users who would like to continue receiving auction updates will be able to sign up and get them through their mobile phone or PDA.

Microsoft, meanwhile has nixed its site directory for Passport, although Passport will be very much a way of life for users of Microsoft's Web sites, such as its e-mail offering Hotmail.

"We have discontinued our Site Directory, but you'll know when you can use your Passport to make sign-in easier. Just look for the .NET Passport Sign In button!" a notice on its Passport site said.

In October, online job listing company Monster.com stopped using Passport after three years as a partner.

The latest move from eBay raises the question of whether Passport has a future in Redmond's vision of using the sign-on system for accessing secure Web services.

Many analysts believe Web services, distributed computing that allows applications to communicate with one another, will only work if vendors can promise safe, trustworthy single sign-on services to users. For example, experts expect a combination of single sign-on and Web services to enable shoppers to purchase goods in a mall through a handheld computer.

But Microsoft has been faced with mounting concerns about security due to a rash of security issues in its Windows operating system and IE browser. The problems have left some customers and partners leery about subscribing to Passport or other services that require users to provide their personal information, such as address and credit card data.

The situation wasn't helped in 2003 when two security analysts for Gartner urged financial institutions and other enterprises to stop using Microsoft's .NET Passport service.

"Microsoft failed to thoroughly test Passport's security architecture, and this flaw — uncovered more than six months after Microsoft added the vulnerable feature to the system — raises serious doubts about the reliability of every Passport identity issued to date," according to a report at the time by John Pescatore and Avivah Litan for Gartner.

"Passport lost momentum a long time ago, and now we have significant evidence of market erosion. I'm sure this is not the last such case we'll hear about," Forrester security analyst Jonathan Penn said.

"Remember, eBay is being hit by fraud via phishing and keystroke logging attacks on its customers," he said. "The last thing they need to worry about when dealing with all these account compromises is an open door over which they have no control. The security weaknesses and lack of control participating organizations have in Passport (being a centralized, MS-run service) is undoubtedly a big factor behind eBay's decision."

The company also faces tough competition regarding single sign-on and authentication systems. HP, Sun Microsystems, and others offer their own federated identity service through the Liberty Alliance, which IBM joined in October along with seven other members.

"Authentication remains a widespread industry issue," Earl Perkins, a security analyst at META Group, said of Liberty at the time. "An organization capable of leveraging support from influential companies across industries and developing and model that makes strong authentication convenient, affordable, and interoperable between infrastructures and authenticators... is well-positioned to drive widespread adoption."

I met lot many bunch of MS evangalist who advocate and sometimes preaches that, MS products are suppose to be the world's best upto extent of de-sale Linux and Unix based products ( Favourite argument of this guys is which version of Linux? Which build of UNIX?)

I suggest MS guys need to be matured enough to compare themelves as they even don't know that above is evidance enough to be quoted that, organisation loose competitive edge as well as hit badly on bottomline with above divorce incidents.

If u read the above blog, why not sound of your wisdom as comment??

My Clone @ other end of Globe

2004-12-30T02:48:00.000-08:00

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Title might misled you but, it is true. I was not believing that someone exhibit the similar characterstics and behaviour as I exhibited. I even confirmed about it with few of other blogger friends and Collegues/Ex-collegues. I came across this article from CIO.com.

Best part of the attractive title to grip your attention from neck. "Work For A 24/7 Entrepreneur". True to it's characterstics, I must admit that, Brent is genius and appriciate the frank and true description about his habit by his collegue.

I admit that, my ex-collegues have told clearily about my nature of demanding for best and restless followup (similar to what is described as calling guys from holidays but, preserving the privacy and freedom of guys known to be on Holiday).

Rented Life - a Poem

2004-12-29T06:23:00.000-08:00

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I rented my soul to Soil of Mother's womb with Father as Gardener.
We bartered Love....we are rich with Love...
We remain eternal soul

I rented my lovely soul to friends heart.
We exchanged love and hate...I left with balance of Tears and hidden foes

I rented my lovely soul to my employer's heart
We exchanged work and money.... I left with balance of ever growing debts and betraying

I rented my lovely soul to my wife's heart
We exchanged love and faith... I left with balance of incompetent and failed marriage

I rented my lovely soul to God
I offered unconditional Love and God gave me pain, sorrow and failure
I left with feeling of emptiness and shattered into pieces.

Still, I don't get tears drying on my cheeks as they dried in my eyes.
Still, I don't feel pain surfacing on my face as it remains in my soul and body
Still, I don't bother fear my life as it's jammed in my brain and mind
Still I don't get failure bothering me as it's all around my life
Still I don't get sorrow shattering me as soul and body is pierced

Any way deducting Zero out of Zero results in Zero
Love is Priceless, Yes, u can't get anything out of Love all other comes free.

Meanings and Mind Reflections:

I got love when born from my father and mother. I thought that, all human being dwell on earth and expects only Love. All human being I met, shown that they acknowledge my love.

I loved all in this world unconditionally. I came to know that, all relations ended in mean ends of profit, advantage and exploting. Glass wall of Love shattered into pieces to see I am surrounded by world of mean pepole. Each interaction has some means to serve rather than love.

I got feeling of being robbed physically and emotionally. I went and asked God. God never responded as if Love was burden for God and he got ride by giving it to me.I felt I will die due to this burden some love. Life has come to cross road of Zeros. Each path looks empty. Each day looks empty. Energy of Life have dried.

Waiting to die is everyday job accomplished successfully everday. God also achknowledge the day with bestowing feeling of being useless character on earth. GOD THANKS for making me what I AM? I DESERVED IT.

GOD THANKS FOR ALL YOUR PRAYERS OFFERED. BAD AND MEAN GUYS ALSO OFFER AND U ACCEPT IT and BESTOW ALL TRESURES OF LIFE TO THEM. I GOT PRICELESS LOVE FROM YOU.

Supply Chain Management for Banks

2004-12-29T05:38:00.000-08:00

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Supply chain management is the combination of art and science that goes into improving the way your company finds the raw components it needs to make a product or service, manufactures that product or service and delivers it to customers.

The following are five basic components for supply chain management.

1. Plan-This is the strategic portion of supply chain management. You need a strategy for managing all the resources that go toward meeting customer demand for your product or service. A big piece of planning is developing a set of metrics to monitor the supply chain so that it is efficient, costs less and delivers high quality and value to customers.

From Banking prospective, it's developing a new loan or retail product. Let us say, Credit Card (revolving loan credit product) linked with Fixed deposit customer.

2. Source-Choose the suppliers that will deliver the goods and services you need to create your product or service. Develop a set of pricing, delivery and payment processes with suppliers and create metrics for monitoring and improving the relationships. And put together processes for managing the inventory of goods and services you receive from suppliers, including receiving shipments, verifying them, transferring them to your manufacturing facilities and authorizing supplier payments.

From Banking prospective, for credit card product that we are exploring requires team of product managers and business analyst who come up with feasibiliy study, business plan and return figures as well as marketing strategy. Most important is the selling agent empowerment plan, card vendor, authroisation and issuance related IT components.

3. Make-This is the manufacturing step. Schedule the activities necessary for production, testing, packaging and preparation for delivery. As the most metric-intensive portion of the supply chain, measure quality levels, production output and worker productivity.

From above banking product, going into bits and bytes of IT and busienss. Gettign the action plan into action. Marketing and branding for the product and putting the back office process to ensure that, customer application is processed and customer gets the credit card at his door step. Most important is making customer use it " That's trick of trade". Stage is ready for the Roll.....

4. Deliver-This is the part that many insiders refer to as "logistics." Coordinate the receipt of orders from customers, develop a network of warehouses, pick carriers to get products to customers and set up an invoicing system to receive payments.

For above banking product, it means getting the Credit Card application from differnet channels like Web, ATM, Direct selling and other outlets. Ensuring that, bakc office process designed are getting the inputs as planned.

5. Return-The problem part of the supply chain. Create a network for receiving defective and excess products back from customers and supporting customers who have problems with delivered products.

For above banking product, it means rejection at application level, post product delivery, post usage (Customer feels billing is imporper) for the Credit Card.

For a more detailed outline of these steps, check out the nonprofit Supply- CChain Council's website at www.supply-chain.org.

Credit card product is more than that but, considering SCM fundamentals, credit card is nothing but getting the FD customers (To averse the risk) and converting this customers into credit card holder who use the card.

Banking sometimes I feel is nothing ut SCM where, depositors are the Suppliers created in the form of Retail and corporates keeping their money in different forms and Borrowers are the customers gettign this fund and returning it also. The difference comes here which differentiate Manufacturers from Bankers as Bankers make the money on both the side of Chain. Thus, somebody has well said.

"Bankers are the guys who lends you umbrella when it's Sunlight (Summer) and takes it back (Banks like HDFC Bank snatches) from you when it is Raining"

One of the strong reason is I noticed that, bankers offering ATM card and Debit card free in Welcome Kit but, they don't issue Credit Card. One of the reason might be they feel keeping customers money is safer than lending money.

Why do Enterprise Resource Planning?

2004-12-29T05:35:00.000-08:00

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What is ERP? Nice question and single breath answer is "Ek Bar Rona pade ga" (That was Hindi - Translate into English literal - We will have to cry one more time or simply

Enterprise resource planning software, or ERP, doesn't live up to its acronym. Forget about planning—it doesn't do much of that—and forget about resource, a throwaway term. But remember the enterprise part. This is ERP's true ambition. It attempts to integrate all departments and functions across a company onto a single computer system that can serve all those different departments' particular needs.

That is a tall order, building a single software program that serves the needs of people in finance as well as it does the people in human resources and in the warehouse. Each of those departments typically has its own computer system optimized for the particular ways that the department does its work. But ERP combines them all together into a single, integrated software program that runs off a single database so that the various departments can more easily share information and communicate with each other. That integrated approach can have a tremendous payback if companies install the software correctly.

Take a customer order, for example. Typically, when a customer places an order, that order begins a mostly paper-based journey from in-basket to in-basket around the company, often being keyed and rekeyed into different departments' computer systems along the way. All that lounging around in in-baskets causes delays and lost orders, and all the keying into different computer systems invites errors. Meanwhile, no one in the company truly knows what the status of the order is at any given point because there is no way for the finance department, for example, to get into the warehouse's computer system to see whether the item has been shipped. "You'll have to call the warehouse" is the familiar refrain heard by frustrated customers.

ERP vanquishes the old standalone computer systems in finance, HR, manufacturing and the warehouse, and replaces them with a single unified software program divided into software modules that roughly approximate the old standalone systems. Finance, manufacturing and the warehouse all still get their own software, except now the software is linked together so that someone in finance can look into the warehouse software to see if an order has been shipped. Most vendors' ERP software is flexible enough that you can install some modules without buying the whole package. Many companies, for example, will just install an ERP finance or HR module and leave the rest of the functions for another day.

Online Shopping - Volusion

2004-12-28T03:09:00.000-08:00

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These days, it's easier than ever to sell goods on the Internet. And to do just that, Volusion offers a complete e-commerce solution that builds a first-rate online catalog and shopping cart. It's among the best on the market and gives other like-minded companies — ShopSite for example — stiff competition.

As you would expect, the best e-commerce solutions combine ease of use — like not having to learn HTML — with comprehensive feature sets that let you build sites, manage and submit sales, handle credit cards and more. Volusion lets business owners quickly build professional-looking sites that customers can navigate and use easily, and it adds lots of extras for handling inventory, affiliate management, tracking customers and working with e-mail.

Like ShopSite, Volusion employs server-based software that you access through a Web browser, and you don't need to download or install a program on your computer to create and manage a store. Small business owners will have no problems using Volusion to build an e-commerce site by following a simple wizard that presents a variety of options through its on-screen forms.

Pls. visit E-commerce Guide for detail product Review.

Make a Wish True this Christmas

2004-12-27T08:09:00.000-08:00

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Be the FIREMAN
Helping Guy make Poorer's Dream Come True

This is the Story as shared by Joke of the Day - Humor Network.

In Phoenix, Arizona, a 26-year-old mother stared down at her 6 year old son, who was dying of terminal leukemia. Although her heart was filled with sadness, she also had a strong feeling of determination. Like any parent, she wanted her son to grow up and fulfill all his dreams. Now that was no longer possible. The leukemia would see to that.

But she still wanted her son's dreams to come true. She took her son's hand and asked, "Billy, did you ever think about what you wanted to be once you grew up? Did you ever dream and wish what you would do with your life?" Mommy, "I always wanted to be a fireman when I grew up." Mom smiled back and said,

"Let's see if we can make your wish come true."

Later that day she went to her local fire department in Phoenix, Arizona,where she met Fireman Bob, who had a heart as big as Phoenix. She explained her son's final wish and asked if it might be possible to give her six-year-old son a ride around the block on a fire engine.

Fireman Bob said, "Look, we can do better than that. If you'll have your son ready at seven o'clock Wednesday morning, we'll make him an honorary fireman for the whole day. He can come down to the fire station, eat with us, go out on all the fire calls, the whole nine yards! And if you'll give us ! his sizes, we'll get a real fire uniform for him, with a real fire hat-not a toy one-with the emblem of the Phoenix Fire Department on it, a yellow slicker like we wear and rubber boots. They're all manufactured right here in Phoenix, so we can get them fast."

Three days later Fireman Bob picked up Billy, dressed him in his fire uniform and escorted him from his hospital bed to the waiting hook and ladder truck. Billy got to sit on the back of the truck and help steer it back to the fire station.

He was in heaven.

There were three fire calls in Phoenix that day and Billy got to go out on all three calls. He rode in the different fire engines, the paramedic's van, and even the fire chief's car.

He was also videotaped for the local news program. Having his dream come true, with all the love and attention that was lavished upon him, so deeply touched Billy that he lived three months longer than any doctor thought possible.

One night all of his vital signs began to drop dramatically and the head nurse, who believed in the hospice concept that no one should die alone, began to call the family members to the hospital.

Then she remembered the day Billy had spent as a fireman, so she called the Fire Chief and asked if it would be possible to send a fireman in uniform to the hospital to be with Billy as he made his transition. The chief replied, "We can do better than that. We'll be there in five minutes. Will you please do me a favor?

When you hear the sirens screaming and see the lights flashing, will you announce over the PA system that there is not a fire? It's just the fire department coming to see one of its finest members one more time. And will you open the window to his room?

About five minutes later a hook and ladder truck arrived at the hospital and extended its ladder up to Billy's third floor open window 16 firefighters climbed up the ladder into Billy's room. With his mother's permission, they hugged him and held him and told him how much they loved him. With his dying breath, Billy looked up at the fire chief and said, "Chief, am I really a fireman now?" "Billy, you are, and the Head Chief, is holding your hand," the chief said.

With those words, Billy smiled and said, "I know, He's been holding my hand all day, and the angels have been singing." He closed his eyes one last time.

This is Rex Barker C.S (Caring about all of our Sons) reminded that we never know just when our "special gifts) might help make someone's dream come true. Have a magical day.

Best Christmas Gift by Telecome Provider to Customer

2004-12-26T06:51:00.000-08:00

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Dear Customer Support Team@ABC Telecom,

Sub: Christmas Gift from ABC Telecom to one of Loyal Customer (Four Years)

I have been using ABC's Services for last 3 years in LA (98#$%^315). I was one of the happiest customers of ABC. I relocated from LA to NY and opt for the Post Paid connection and paid USD 200 in advance as rent for six month as per their ongoing scheme as of Dec 8,2004.

1. Connection got activated and I got my number as 983232%$^ on Dec. 9,2004.

2. I started sharing with my business partners and customers ABC's number for business purpose as well as to all my friends and relatives.

3. 1st Mistake: DSA Uneducated about the ABC's Telecom Scheme

At the time of filling up the form with ABC, I opted for STD connection and dealer simply took the form and processed. Ideally Dealer should have apprised me for any additional deposits as might be required. Dealer in the quest of getting customer and commission forget to mention the same.

4. Dec 11,2004: I receive a call and SMS that, my documents have not reached and same need to be submitted
ASAP. A call to dealer and issue got sort out.

5. Dec. 13,2004: I receive a WELCOME call from ABC Call Center Agent and apprised me about the Telecom services and portal. I forget to ask about STD facility.

6. Dec 25,2004: I wanted to make STD call and message heard that, facilities is not activated and call on 9892012345 - Customer call service no. for getting it activated.

Call Agent Meg's Interaction:

I made a call to call center and verified as authorized customer by Agent named Meg. I explained the problem and she kept in on Hold to check my telecom service plan. ( I assume she is being provided a PC using which she verified my credentials instead of checking paper records. ABC is supposed to have CRM software displaying customer details).
She informed that, Mobile-to-Mobile STD is activated but Mobile to Landline facility is not activated. She informed me to deposit Rs.500/= to activate Mobile to Landline STD facilities. (Many might feel that it is funny to have such kind of offerings, which are neither full nor half).
I expressed my loyalty to ABC for last Three years in LA as well such deposit being not asked. Apart from that argued that, ORANGE is not asking such deposit and usually ORANGE on case-to-case basis based on Report by the Surveyor. She requested me to talk to Reporting Manager Mr. Ryan.
I requested her to appraise Mr. Ryan about the conversation rather than I explaining the full thing. She assured the same and I started talking to him.
Mr. Ryan has provided standard answer and reasons for deposit, which I refused to accept, and given the same reasons of ORANGE and Bangalore case. All in vein and I expressed my di-satisfaction about ABC's policy and intent of switching over to ORANGE and disconnected the call.

I did not know that ABC Customer Service dept. Rep. Mr. Ryan has decided to present as Gift to valuable customer of ABC "we_d_living" >> Owner of ABC Post Paid Connection. Loyalty of Four years with ABC paid nicely.

ACTION Taken by Mr. Rahul - DEACTIVATING the CONNECTION with reason as per System stating that CUSTOMER REQUEST for DEACTIVATING the line. Despite the fact that, I never ever used the term "DEACTIVATING the CONNECTION" during my entire conversation.

The most inspiring and perfect example of ABC's Customer Service:

It seems ABC has taught during Customer Service training that, in case customer express dis-satisfaction of service, despite the fact that deposit of Rs. 600/= is with ABC, make customer life miserable by DISCONNECTING The line.
Take the Power of Control available and high privilege access of playing with customer's Telecom Account.

SANTA Came One Day Late:
Dec 26,2004: Few calls and another set of friendly voices of Fern and Nick helped in resorting the connection.

Going Further:

I have decided to take up the challenge of being David against such a prestigious Organization (Goliath) where few of them feel that Citizen is not Empowered and they can dance at the power Play of Telecome provider like ABC.

Same copy is shared with leading newspaper Editor to feature in TALKING POINT as a better way of using it to create awareness in consumers about their rights of getting harassed mentally and remotely by such managers.

Sarbanes Oxley: What to Control and How?

2004-12-21T09:57:00.000-08:00

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When sections 404 and 409 of the Sarbanes Oxley Act of 2002 were written, they were originally designed to encompass financial controls only. Kept well within the realm of the internal audit staff, the rules were designed to ensure the accuracy of the financial reporting at each month end. What the PCAOB (Public Company Accounting Oversight Board) quickly realized was that the controls that affect the month end financial reporting stretch well beyond the internal audit group and into the very operations of the organization. Daily changes in the physical environment of a company rarely hit the financial statements until journal entry postings, consolidation and reconciliation are completed at month end. This is especially true for larger organizations that have to gather data sometimes from the other side of the world.

Groups that have been performing the internal compliancy work in these organizations have quickly realized that failures in the underlying processes within organizations are more often the cause of catastrophic corporate collapse. Undisclosed ownership structures that reduced the level of debt and risk and overstated the revenues were the biggest single failure points in Enron. But the ability to establish structures such as those that brought down the major energy trader rested well outside the realm of financial disclosure rules and regulations. They rested with the executive ethics and oversight committees that were never created at Enron and were never supported by the board. Just like this example, there are a wide variety of significant continuity threats existing in organizations that could be interpreted by the PCAOB and the SEC to be failure points that required control mechanisms. One such example is Information Technology assets operations and policies of the organization and its external IT suppliers.

How IT Operations Can Fail Sarbanes 404/409

Compliancy Sarbanes 404 states that there must be a clear declaration of responsibility by management for establishing and maintaining an adequate internal control structure and procedures for financial reporting as well as an assessment of the effectiveness of the internal control structure and procedures of the issuer for financial reporting.

Sarbanes 409 states that boards must disclose to the public real time information concerning material changes in the financial condition or operations of the issuer including trends.

Impact of/on IT:
Both of these two sections rely on the control of and physical processes within organizations. Without controls on an information infrastructure, the company will be unable to declare and assess that their controls are effective for financial reporting simply because the information generated for the financial postings are derived from the physical activities of the organization that are controlled by these very systems.

It's those systems and those physical flows that require the same level of control infrastructure and testing for management to be able to attest to the effectiveness of their entire controls structure. For example, a chief operations officer delegated the authority to book income based on delivery of goods or services, can easily manipulate the revenue figures by altering the derived delivery date within systems (which may fall under his control) to equal the contract signing date. The result may be booked income that is effectively not realized in a later time period as it should and possibly without any corresponding offset. A control that limits the individual's capacity to alter system functions can effectively eliminate the potential requirement of restatement and the potential negative impact of such an event in the public realm. The test plan would incorporate a functionality test in which the auditors attempt to alter the systems invoicing date functionality through the security level of the COO. A failure to alter the date would result in a 'pass' on the test that is then documented complete with the test plan and outcome, process chart, control report and sign-off.

There are numerous areas that can be tested to this level of detail regarding all physical functions within an organization. However, the narrowing of the controls to those functions that have a material impact on the financial statements greatly reduces the workload on companies trying to comply with 404. 409 on the other hand, requires less of an actual control and more an ability for the organization to gain "real time" information from systems on the physical flows and inventories of that particular company or division. However, controls and real-time information are not the complete picture.

The Role of Policy in 404/409

Policy is a very strong tool of organizations working toward compliancy. Policy forms the statement of intention that provides a strong indication of management's work toward compliancy. For example, an organization that is attempting to 'lock down' potential ethical misdoings by its executives would be well advised to start by creating a comprehensive ethics policy for the organization and then have each executive sign the policy as part of their agreements. This won't control the behaviour of executives that would breech ethical guidelines but it will send a clear message that the organization does not condone specific types of activities. The addition of an oversight committee and 'whistleblower' mechanism continues to add to the position that the company is seriously backing the controls structure. Now as individual and detailed controls are added, the organization is well placed to provide attestation. The same type of policy must be formally created and accepted by the board regarding the operations of the information systems infrastructure. Without the overriding policy regarding such things as physical IT security, the attestation of the controls will be ineffective.

Seven Important IT Control Considerations

Create an information security policy that governs both the physical access to systems as well as the virtual access. Back it up with physical stress tests of the security infrastructure such as ethical hacking, rogue RF detection, portable device policy and planned security breeches. Ensure the policy regulates such things as password rotation, authorization levels, functional security control mechanisms, audit trails, etc.
Create a policy regarding outsourced and supplied IT functions relating to such aspects as the protection and control of sensitive information, the level of SOX compliance from support organizations, new software controls policy, upgrade and test reporting policies, etc. Ensure that a formal digital rights policy is in place for the organization as well as a public information control and release policy.
Identify each sub-system that has the potential to materially affect the financials or other systems and provide an assessment of the risk for each one. Use this list to identify the most critical systems and controls and apply resources to those first.
Create a hot site, back-up and failover policy along with testing and failover operational guide. Remember that backups must be periodically tested to ensure that critical systems have the capable redundancy required for continuity and non-material impact limitation.
Provide an audit capability to change, update and testing processes to ensure that standards are upheld and that the effects of rogue activities are minimized.
Map each of the physical control processes in the IT department and ensure that the correct level of responsibility and oversight is applied. Test the controls by following and auditing the processes utilizing any audit trails available or mapping current activities.
Perform tests of system accuracy, completeness and appropriate authorization of physical data that is materially relevant. Ensure such factors as numerical sequencing, separation of duties, physical reconciliations and exceptions are tested, performed, managed and overseen.

The information infrastructure of an organization is a critical component to compliancy for 404 and 409. Without an assured amount of testing and controls, the management will not be able to certify the controls processes with any level of certainty. The failure to adequately test the system controls will provide the next level of issues regarding Sarbanes Oxley compliance and will undoubtedly lead to stronger regulations regarding underlying systems and processes.

Next Challange - Treasury management in emerging-market banks

2004-12-21T09:30:00.000-08:00

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Elevating the treasury from a support function to a bank’s primary instrument for managing market risk can have a far-reaching impact throughout the organization.

Interesting survey findings by McKinsey's Team spanning across banks operating in Developed and Developing Countries.

I feel Indian banks can learn more from it and look beyond Money Market, Bond MArket operations and venture into Securities and Commodity Trading. Indian retail space has started Commoddity trading in big way with value trading equal to BSE and NSE volume.

Pls. comment on article......

Drivers for BPM - Few Writing on the walls

2004-12-20T05:50:00.000-08:00

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In late 2000, Gartner predicted that business process management (BPM) would become the next big phenomenon. The "thought leadership" expressed then has been reflected in the current popularity of business modeling.

We have seen demand grow from 15 percent of our client base (which primarily involved businesses with planning cultures) to more than 35 percent of our client base across all businesses, regardless of their cultural tendencies.

1. Build New Process for New products but Preserve the Business model
BPR geeks have dismaneled the process in the quest of operational efficiency, cost effectiveness... Business came up with new products and services due to new mode of trades and delivery modes like Internet, Mobile Commerce, Workflow, Document Management, XML ....Again New Processes and change managements.

Why few IT Managers are crying that, they don't see BPM appriciate it's investment ?

Successful businesses have not changed their business model and thus gained from new technology by changing the process not the customer benefit. Some enriched the experience and some failed to do anything but annoy the customers with their new ineffcient processes and product/services.

2. Process followed the business
Business underwent strategic changes like Merger and Acquition, BPO, Innovation... process across two different organisation requied to be integrated and streamlined. Few cases like Compaq HP merger has shown that, organisation is not able to fully leverage their competitative edge after such strategic changes.

Process were treated like Centralised Knowledge Entity and looked upon under lens of aging, change history, customer orientation etc. Process were changed several times and significance of defined and assigned to it. It's like chemical reaction on Golden metal plate and entropy of metal is calculated after each exposure. Process are also needed to be treated once it looses it's basic characterstics or value and evolve new process.

3. Age of TEchnology and ORganisation learning:
Each of us would have rid on hype wave. It can be technology, process or innovative way of use. In order to fit the technology, organisations changed themselves (E.g. typical ERP implementation in XYZ Industry/sector). few wanted to convenience and felt pressure from board/investors about org.(and IT Managers) capability to implement ERP solution in org. and they Changed themself to adopt the IT solution.

Few went otherway round and I feel they were smarter, They felt they have efficient and effective process ( Some deed process evaluation) and customised the product for MATCH MAKING but again it was also tainted sometime for making their board/invesor's (or their biz. partners) feel happy.

BPM is still going to remain the major force as more and more such changes are ineviatable in present trough of economic cycle.

Above were drivers from Human and ORganisation strategy and operational aspect as well as touch upon the market place.

Few other drivers are due to the perceived advantages of BPM.

1. Automate...More.. and Connect More ...
STP (Straight Through Processing) and SCM (Supply chain Management) is the main driver for biz. to look at changing the way they do their business with their suppliers, distributors, Creditors (Banks and FIs) etc...

Each business manager is looking under the magnifiying lens such business interactions happening either human to human as well System to System. Collobrating and influncing their partners for SCM and STP to create new or enhanced business value.They get faciliteted by simulated process using BPA tools to testigy and justify their strategies and decisions.

2. Milk the Networked Business
Once you are on the go of BPM... business manager start using few jargons in their corporate presentation to board/investors/partnes ..."optimized cost, time to market, resource loading, risk indetification and management, quality optimsiation (SIX SIGMA Jargons) through the use of models for initial design and ongoing improvements.

But, it is sure that, business using BPM effective and efficienctly has seen by numbers that they are milking the market place.

3. Create newer market place or market conditions.
Few corporates are able to realise their process model strength explore weakness of either competitors or peer level corporates in other market place. Few of the business users are able to apply their process capabilities to unknown territory.

They simulate and anticipate opportunities as well as threats usig such simulations. One of the example I remember is a financial institute able to manage account receivable for Telecom giant. It has better process of rating customers from it's past credit record to provide additional talk time or request for offering credit against their account balance as additional talk time. IT resulted in increase in revenue for Telecom. Bank is able to get integrated view of such customers for their demography and spend pattern to device new products.

In case u liked /disliked above blog... drop a word... I believe that I can improve...

Business Value of Data Warehousing (Unfied Custome View)

2004-12-18T06:04:00.000-08:00

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Financial services giant ING Group has been getting kudos from industry observers for developing a unified IT architecture that more effectively pulls customer data from multiple accounts. The company’s construction of multiterabyte database “hubs” for its seven U.S. business units has resulted in a comprehensive, unified view of customer activity. Thomas Hoffman and Lucas Mearian report on the success of this enormous project in the September 27 issue of Computerworld.

The data integration effort began in July 2001 with the goal of creating a reusable architecture that would both drive down costs and mitigate risks. Chief Technology Officer Raymond Karrenbauer tells the journal, “The hubs are for centrally structured data ... enterprise value data that’s commonly used across all lines of business, [including] customer information, agreement information and product information.”

In May 2003, the company began to implement its integrated data environment. According to Computerworld, the structured data resides in a set of partitioned IBM DB2 Universal Database EEE databases.

The project relies on data-mapping software from Informatica Corp. that lets ING cross-reference customer information among databases at business units. Data profiling software from Evoke Software Corp. is used, along with ad hoc reporting and analytical tools from Business Objects SA. The result is an object-based database infrastructure that blends unstructured and structured data from 2,000 databases into one logical view of customer and operational information.

The journal reports that ING created DB2 repositories to aggregate a subset of structured data from each business unit’s database that may be relevant to other business units. The system funnels source data through a hub where a series of transformation and de-duplication steps is conducted. A separate repository stores unstructured data. Karrenbauer explains that an architectural layer sits above this, which uses metadata to determine common traits between structured and unstructured data.

While some data is transferred in batch mode, ING is also piloting real-time, bidirectional data updates between the databases. As part of the data integration process, ING centralized some of the source data from existing databases and classified it with common terminology so information could be shared across business units, Karrenbauer tells Computerworld.

He notes that each information hub has hardware costs of between $2 million and $4 million, but he adds that several projects have resulted in an internal rate of return of more than 100 percent by avoiding project delivery duplication. Karrenbauer explains that ING’s standardized project delivery model can be repeated as each business unit pursues its own relational databases.

Other ING divisions in Brazil, Chile, Canada, and the Netherlands will be able to apply the information-hub approach adopted by ING Americas as a template for their own data integration efforts. Karrenbauer tells the journal that he estimates they should be able to reuse 50 to 65 percent of the IT architecture created by his division.

ING’s Chief knowledge officer Linda Marr tells Computerworld that the unified IT architecture is already paying off. She cites recently enacted antispam regulation requiring financial services companies to provide customers with an e-mail opt-out option. Marr explains that ING is about to comply with the regulation because it has all of its customer information accessible from a single environment.

What is Wrong? IT Investment or Strategy

2004-12-17T02:14:00.000-08:00

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To protect shareholder value, companies must link risk management with strategic planning and avoid overreacting to regulatory compliance mandates.

Above was the wisdom of recent research findings by BAH(Booz Allen Hamilton). It is real story of facts about corporates missing the train and burning investor's money.

Here’s a fact that bucks conventional wisdom: More shareholder value has been wiped out in
the past five years as a result of mismanagement and bad execution of strategy than was lost
because of all of the recent compliance scandals combined. This is a key finding of a recent
Booz Allen Hamilton survey and analysis of the performance of 1,200 firms with market capitalizations of more than $1 billion for the five-year period from 1999 through 2003.

Consider the 360 worst financial laggards. 87% of the value lost by these firms was attributable to strategic missteps — management ineffectiveness in reacting to competitive pressures or forecasting customer demand — and operational blunders, such as cost overruns and M&A integration problems. Only 13 percent of the value destruction suffered by these companies was caused by regulatory compliance failures or was a result of poor oversight of company operations by corporate boards.

Read the complete article for more details.

Temparament of CIO

2004-12-17T02:06:00.000-08:00

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Sara is Deputy IT President and her temparament is described as case study to unerstnad criteria affecting
INTJs typically are imaginative and determined innovators who are stimulated by difficulties and attracted to bigger and bigger challenges. INTJ is also the most independent of all personality types.

INTJs and the Five Criteria for CIO Success

#1: Defining and communicating a shared IT vision, strategy and tactical objectives. Sara's intuitive orientation means that she has the insight to identify issues and patterns and the inspiration and imagination to define a better way. Unfortunately, her introverted nature means that she treats strategy-making as a solitary pursuit. Setting direction is a participative process; otherwise, the commitment necessary for action will be missing. To guard against her natural tendencies to go it alone, Sara must define a process that ensures participation of key stakeholders across the organization. She must then assign IT professionals who are intuitive extroverts (ENs, in the Myers-Briggs shorthand) as key resources in the effort.

#2: Delivering quality results on time and on budget. Sara's judgmental nature means she is comfortable with planning and making decisions and is determined to get things done. She is stimulated by difficulties and loves to solve problems. But since INTJs get bored with details and, at times, do not live in the world of "what is" (that is, facts), Sara needs to refine her thinking process. She must ensure that her project and operational leaders do not consist of people just like herself, or there is a good chance that her IT organization will not deliver on time or meet the needs of the business. These unlike-minded people will act as "sensors" to keep the project grounded in reality (but beware - too many sensors can limit project creativity or result in analysis paralysis).

#3: Helping the business realize value from IT investments. IT value is a dual challenge: first, governance needs to be established, and then business leaders need to be convinced that following the rules is in their best interest. Sara has no problem defining what mechanisms are necessary to promote value realization, but she does not inherently possess the gifts of persuasion to get the rest of the organization on board. To balance her strengths and shore up her weaknesses, she will need thinking extroverts (also known as ETs) on her staff who feel comfortable with the collaborative process of negotiation but who will not give in on key principles or avoid conflict just to make everybody happy.

#4: Fostering good relationships. Executives derail themselves if they are intimidating, abrasive, aloof or arrogant. Since Sara is more comfortable with ideas than with people, she tends to make decisions without considering the feelings of others. She often approaches situations with her mind made up and is surprised by the opposition that results. To be sure, quick-and-easy relationships will never be Sara's strong suit, but she needs to at least neutralize her natural tendencies by forcing herself to interact with others - even though, in her mind, there is no real purpose to it. She can force herself into business relationships by making it a project (for example, defining who she needs to talk with and scheduling regular interactions), improving her cocktail party conversational skills (by preplanning conversational topics and using reflective and active listening), and refining her negotiation skills (using principled rather than positional negotiating).

Once again, Sara can use her staff to bolster her weaknesses. In this case, she can ensure that her client-facing personnel include an adequate number of extroverts.

#5: Building and leading a credible IT organization. Executives also derail when they fail to staff correctly. Since introverted thinkers (ITs) like Sara connect to others through ideas rather than feelings, they don't get to know people on a human level. Therefore they have a tendency to appeal to the head and hands but not the heart. Sara's people are stimulated by her vision, clear direction and delegated authority, but they feel their personal needs are not necessarily understood. Their assignments may not be relevant to their career aspirations. For Sara, the answer is to carve out time to get to know others by asking questions about their goals, values and perceived strengths and weaknesses. Then she can apply her intuitive, thinking skills to define a development plan that will meet the needs of both individuals and the organization.

Each of you shares Sara's predicament, if with a different mix of personality tendencies. Every day, your talents and weaknesses fight each other for their chance in the spotlight. The extent to which you are filling your role with the necessary skills - yours or others' - defines how successful you are and how much you enjoy what you do.

Dust off your latest personality assessments and extract the insights necessary to become better than you really are. The MBTI® isn't the only assessment, nor are such tools the only method of learning your strengths and weaknesses. Make sure you work for a variety of bosses throughout your career. Sign up for the right kind of 360-degree assessment (see "An All-Around Waste of Time"), so that you are able to validate your progress.

Armed with self-knowledge and with their egos in check, executives like Sara - and you - can use every resource and tool to become better than they really are.

Google Unveils Froogle Product Reviews

2004-12-16T21:53:00.000-08:00

Online Product Rating is Big Opportunity
What is the best way to buy a product online?? Ask any online shoppper and invariably he will list out 5 to 10 tips of validating product and vendor genuiness. One of the item to come up in such tip is look out for product and supplier rating.

With online shopping growing year on year and some of the labour pains of online shopping portal, innovative ways to reinforce confidance in online shopping like - Froogle.

Wise Web merchants will start paying attention to the reviews their products are getting online, since more consumers will have ready access to those reviews -- thanks to recent additions to Google's online shopping engine, Froogle.

The new feature, Froogle Product Reviews, aggregates product ratings culled from the media and product-rating Web sites.

Froogle, of course, pieces its product database together by crawling the Web and integrating feeds from merchants. Search results typically show photos, prices, and the online merchant carrying the product.

Now, when Web users search for "digital camera" on Froogle, a ratings score appears beside each result, aggregating the product's ratings on Web sites on a five-point scale (similarly to how Metacritic.com gathers movie reviews and generates an aggregated score). Froogle also posts the number of reviews for the product.

Google's Search Engine Enpowers Froogle:
Key differentiator for Froogle from some of the similar services like Product Reviews, Store Ratings are culled from end-user ratings sites like BizRate.com, Shopping.com and ResellerRatings.com is the Google's Search Engine capabilities embedded and working behind.

Users can click on the rating or number of reviews to see a listing of relevant reviews -- and moreover, can then search within the reviews for specific phrases like "battery life," "photo quality," or "customer support." Shoppers can also sort the reviews by review source, relevance (Google's search algorithms determine from the search term) or by date.

Consequently, it behooves merchants to polish their reputations on those ratings sites -- ideally, by giving good customer service, which will then be reflected on those sites.

In addition to Product Reviews and Store ratings, Froogle also recently introduced a customizable shopping list, which can be shared with friends as a Wish List.

The McKinsey Global Survey of Business Executives

2004-12-11T21:46:00.000-08:00

The second McKinsey Global Survey of Business Executives finds that corporate leaders are still confident—especially about hiring, IT spending, China, and India—though they’ve tempered their earlier enthusiasm.

McKinsey is taking ot of pain in monitoring and researching on Asian continent especially China and India.

Visit the Survey for interesting survey of more than 5500 executive across the globe conisting of Investment Managers, Analyst, CEOs and Chairman.

Merger and Acquition - IDBI and IDBI Bank

2004-12-11T20:45:00.000-08:00

IDBI: The way forward?

Challenging one of the most aggressive banks in the country i.e. ICICI Bank in the retail space and gaining market share is no mean task! But IDBI Bank, post its merger with parent company IDBI, seems to be gearing up to achieve this feat.

A scrutiny of the fundamentals of the two merging entities (read IDBI and IDBI Bank), suggests that both the entities will be equal beneficiaries of the synergy. The “merger ratio”, which will reflect their respective bargaining powers, will also give an indication of the future valuations to be assigned to the merged entity. The following is an estimation of the said valuations in two different scenarios.

IDBI Bank merges with IDBI...
In this case the synergies will act in favour of shareholders of IDBI, as their upside in terms of EPS will be higher than the IDBI Bank shareholders.

Reverse merger of IDBI with IDBI Bank...
In this case the IDBI Bank shareholders will be the undisputed beneficiaries of the merger, as every share of IDBI (current market price Rs 97) will then be valued at Rs 25 or lesser (i.e. 74% cheaper than the market price!).

Let us look at Reverse Merger of ICICI with ICICI Bank:

Post its reverse merger in FY02, ICICI Bank has emerged as the strongest entity in Indian private sector banking. The investments and advances of the bank have augmented by 19% and 32% respectively over the last 3 years, while the deposits have grown by a whopping 112%. This gives a clear indication of the momentum that the bank gained, post its merger. Are we looking at a similar story in case of IDBI? Our estimations of the financials of the merged entity present the following picture….

	ICICI Bank	ICICI Bank	IDBI	IDBI Bank	Consolidated Entity
	(Pre merger- FY01)	FY 04	FY 04	FY 04	FY 04
ROA	0.40%	1.40%	0.60%	1.30%	0.95%
Investments (Rs in m)	358,911	427,429	98,800	39,100	137,900
Advances (Rs in m)	470,349	620,955	451,100	74,000	525,100
Deposits (Rs in m)	320,851	681,086	49,800	100,500	150,300
Net NPAs (Rs m)	26,292	14,226	11,244	623	11,867
Net NPA to advances	5.50%	2.20%	2%	0.80%	2.26%
Credit / Deposit Ratio	146.60%	91.20%	85%	73.60%	349%
No. of Branches	540	413	101	92	193
ATMs	1,000	1675	NA	298	298
No. of Employees	7,700	13,609	1,400	1,700	3,100
Business/employee (Rs m)	103	95.7	-	108.0	108
Business / branch (Rs m)	1,465	3,152	-	1,517	1,517
Profits/employee (Rs m)	4.8	39.6	2.7	0.8	3.5
Profit after Tax (Rs m)	4,249	3,788	3,789	1,326	5,115
No. of shares outstanding (m)	613.0	616.0	652.8	214.2
No of shares held by IDBI in IDBI Bank (m)			120.0
No. of shares outdg post merger (m)					684.2
EPS (Rs)	4.2	26.6	5.8	6.3	7.48

The above comparison is intended to give investors, a futuristic view of the strength of the merged entity, as well as the figures that the entity should benchmark against, to achieve its goal of replicating ICICI Bank’s success. As the figures suggest, we are likely to witness a head to head collision between ICICI Bank and IDBI Bank in terms of corporate financing. But when it comes to retail, it is evident that, IDBI has a long way to go. Nevertheless, IDBI scores immensely in terms of its efficiency ratios. In spite of having one third the number of employees and half the number of branches, the merged entity (IDBI) is likely to outperform its prospective retailing rival (see the business per employee and business per branch ratios of ICICI Bank and merged IDBI).

However, the caveat in this case is the true quality of the assets. Although IDBI has been successful in pruning its Net NPA ratio to 2.4% in FY04 as against 14.2% in FY03, thanks to the Rs 90 bn government bailout package, 37% of the “restructured loans” still have a high probability of slippage in future.

Watermark for Fundamental Analyst:

At the current price of Rs 364, ICICI Bank is trading at a price to book value ratio of 2.7, while at Rs 97 and Rs 51, IDBI and IDBI Bank are trading at price to book value ratios of 0.7 and 2.0 respectively. When and what will be the true valuations accorded to the proposed merged entity, depends upon how soon the respective entities (IDBI and IDBI Bank) are successful in displaying the true colours of their synergy.

Do open systems compromise performance?

2004-12-10T03:45:00.000-08:00

I am keen follower of anything and everything happening in Open system space. Let it be small scale upgrade of non critical system from Microsoft to Linux in corners of so many companies around the world. All qudoes to guys who struggle to convenience thich skin Crocodile bosses. Even bigger place like German Railway Transporation Agency moving their 40 ciritical server to Linux (Over S/390 with virual partition).

I come across interesting survey conducted by Asian Bankers debating on most important aspect of Open System deployment. Few extracts from the same is reproduced for your reference.

Asian Banker Research has found that the total cost of ownership advantage of open systems versus proprietary systems may not be as great when issues such as scalability and stability are considered.

Cost remains the fundamental issue in core banking systems decisions. A recent survey of 17 banks in Asia by Asian Banker Research showed that 47 percent of the institutions are choosing to replace their legacy systems with open systems rather than with proprietary technology to obtain cost efficiencies, despite a possible sacrifice in performance, stability and availability.
Asian Banker Research found that total cost of ownership (TCO), the Gartner-formulated industry standard for measuring and managing IT investments, is significantly lower for open systems compared to that of proprietary technology. Although the cost benefits vary among banks, savings as high as 50 percent are not unheard of.

In core banking, the biggest savings can be obtained through the reduction of operational costs – specifically the costs of hardware support, operating systems and software licenses maintenance. Studies have shown that the TCO for UNIX is competitive against other operating systems, while Linux’s TCO is even lower.

Reduction in no. of Vendors:
The key driver for cost reduction in the open systems space is the number of vendors for hardware and software, of which 37 percent of banks agreed is an asset of open systems. Unlike proprietary technology, open systems allow for a freedom of choice where customers are not locked into one particular vendor, hence, spawning competition that drives down costs and stimulates a wealth of product offerings.

Reduction in Development Cost (Talent rather than Salary):
Across the board, banks agree that the cost for hiring proprietary technology specialists outweigh those of open systems. A source cited that salaries for PL1 programmers are one and a half times those of Java peers. This trend is particularly evident in India, where the ease of procurement of CMM level 5 professionals and competitive costs of local talent are highly attractive.

Concurrently, 11 percent of banks cited the availability of third party applications compatible with UNIX as a key strength of open systems. Although the presence of standard protocols enables UNIX packages to be comparatively easier to implement into the core banking system, integration remains a complex endeavor, complicated by the existence of various configurations of UNIX.

Another 37 percent identified open systems to be more scalable. Despite the relatively unproven technology of deploying open systems on a massive scale, one large multi-national bank that is planning to migrate from their legacy platform to an open system is confident that any scalability problems are rapidly disappearing.

Critics, however, opined that open systems do not measure up to proprietary systems in this aspect because an increase in transaction processing volume would require the incremental addition of CPUs, which in turn may affect the performance of software applications that are not developed with this scenario in mind. Furthermore, the relational database nature of open systems places a relatively higher demand on the overhead of the CPU and storage disk than the non-relational database nature of proprietary technology.

Stability and availability remain areas where open systems fall behind. While the proprietary systems are known to be stable and less vulnerable to attacks, outages can occur in open systems as often as once or twice a month. Remedy of problems such as clustering, mirroring and fall-over processes will add to the TCO of the enterprise.

In view of open systems’ cheaper technology, even banks without prerequisite UNIX and Linux skills are willing to work around this problem by outsourcing or developing the skills of their internal employees to benefit from its cost advantage.

Asian Banker Research expects that TCO for open systems will become even more attractive as further convergence between open and proprietary systems coupled with heavy research and development ensures that technology of open systems keeps maturing and improving.

A New Metrics System for IT

2004-12-09T02:55:00.000-08:00

How Cisco is approaching the Holy Grail of truly measuring IT value.

The old effort to figure out IT's impact on organizational productivity has new life.

At Cisco Systems, a cross-departmental council has been working to hash out metrics for improving business process operations, according to CIO Brad Boston. In 2003, the council developed metrics to evaluate the efficiency of its online order processing. Less than 30 percent of orders were getting automatically routed to manufacturing, since high error rates necessitated manual input, according to Boston. "We mapped the process of orders coming in and developed metrics. We optimized the process, put new tools in and doubled the percentage of orders that went directly to manufacturing within six to nine months," he says.

A new twist in productivity metrics is the brave new world of business process design and analysis. CIOs are using (and in some cases creating) performance metrics to help their organizations get a better handle on partnerships and service agreements, and to claim (or keep) a place at the strategic planning table. CIOs say that these emerging "value" metrics

Value metrics occupy the intersection of hard and soft performance measures, combining observation and intuition.

What value are we contributing to revenue growth,
to being able to roll out new products and services,
to cut the time to do those things,
add to customer satisfaction and retention and cut costs?"

Metrics as Tool used by CIO:
While acknowledging the limitations of productivity metrics, CIOs use them to strategize, budget, weigh outsourcing decisions, run (and terminate) projects and communicate with other senior executives.

Pitfalls of Productivity
Ironically, the preoccupation with productivity can be a drain on productivity. "We don't have a good way to [calculate IT productivity], either to forecast or to measure," Intel's Busch says.

"As a result, we end up justifying and rejustifying, and analyzing and reanalyzing stuff, and coming at it from different angles and trying to persuade people with different measures."

"I don't think personnel appraisals are as dependent on productivity metrics," Busch says. "We measure people on results rather than on unit output per period of time.

"It may sound a little philosophical, but I'm not sure whether you can talk about productivity in a world where you're not actually talking about repeatable tasks," BT's Stockman says.

Productivity metrics are morphing to fit the environment. The key is finding a way to establish a productivity baseline, according to Busch. "I don't think we're very close to it," he says. "It's hard to tie [economic measurement of companies' results] back to individual project activity in a lot of cases. We need something that's much more trackable."

2004-12-08T02:04:00.000-08:00

Buying your way to the top of search results may seem easy, but managing an effective search engine advertising campaign requires a thoughtful approach with more than a little elbow grease.

Search engine advertising's popularity has exploded over the past few years, offering marketers top positioning and providing searchers with appealing alternatives to annoying banners and pop-ups. To newcomers, the process of bidding on keywords, then sitting back and watching traffic and online sales start rolling in, seems easy and painless.

That is, until the hapless advertiser gets into a bidding war with a irrational competitor. Or when the boss requests specific return on investment (ROI) numbers to justify a search advertising campaign's expense. These are just two of many issues that can bedevil a marketer embarking on a search advertising effort.

Search Engine Advertising by Catherine Seda offers a wealth of information about the entire process of creating and running an effective search advertising campaign. It's an excellent book, written by a pro who not only understands the mechanics of search engine advertising but also has the ability to describe sometimes difficult concepts with ease and skill.

The book starts off with a critical but often overlooked activity: planning a successful strategy. Search engine advertising's apparent simplicity can become a trap for those who don't create a solid foundation for their efforts.

Long before you place your first bid, it's crucial to go through the often challenging process of keyword research. It's also important to spend time writing ads, creating compelling copy that entices people to click through to your Web site.

Another key activity is creating effective landing pages, your one chance to convince the visitor to spend more time on your Web site and ultimately convert; to buy a product, register for an account, or subscribe to a newsletter. Seda covers these topics in depth, offering numerous tips and strategies from her own extensive experience.

The book also includes excellent coverage of paid placement and paid inclusion programs, their strengths and weaknesses, and when and how to use them most effectively. It covers specialized search engines: shopping search engines and targeted search engines that focus on a particular niche or cater to residents of different regions of the world.

Once you've created and implemented a search engine advertising campaign, you must constantly monitor it, measuring success (or failure) and continually tweaking your approach. Part four of the book provides detailed information about performance measurement, including a look at some popular bid management, analytics, and ROI tracking tools and solutions.

The book wraps up with a section on protecting your profits. Though it's not widely discussed, click fraud can and does occur with paid placement programs. Other problems include improper use of your trademarks by competitors and affiliates using tactics that may do more harm than good. Seda shows you how to identify these types of problems and offers useful strategies and tips for dealing with them before they become major issues.

Full disclosure: I was a reviewer for this book prior to publication. I'll repeat what I wrote then:

The wealth of accurate, savvy information contained in this book makes it a must-read for anyone promoting products or services online. Using even a few of the tips and techniques offered in "Search Engine Advertising" will boost your results significantly, paying for the book many times over.

All Indian ATMs to interconnect by next July

2004-12-08T00:55:00.000-08:00

ATMs of all public and private sector banks in India will be brought under the umbrella of the Reserve Bank of India's national financial switch by July 2005, said ATMMarketplace.com in a report.

The project, aimed at inter-connecting the ATMs of all banks, is being coordinated by the Institute for Development and Research in Banking Technology. Euronet Worldwide, through its Euronet Services India division, is implementing the ATM connectivity project for IDRBT.

Three banks – Corporation Bank, Bank of Baroda and ICICI Bank – have already joined the network, which launched officially in August. Seven other banks will likely be connected to the switch by January.

‘The IDRBT is not concerned with the charges that banks will levy for using each other's ATM network. That will be left to the banks to decide. IDRBT is solely working on ensuring that money can be withdrawn from or deposited into any ATM of the country, irrespective of the bank in which a person has opened an account,’ said IDRBT director V.P. Gulati.

IDRBT also runs the INFINET (INdian FInancial NETwork), the national communications backbone of the Indian banking sector.

Will Power and Self-Discipline

2004-12-07T09:45:00.000-08:00

Everyone possesses some habits or addictions he wishes he could overcome, such as smoking, excessive eating, laziness, procrastination or lack of assertiveness. Developed will power and self-discipline bestow the inner strength to overcome any negative habit. They make a great difference in your life. They can make you a winner in whatever you do.

What are Will Power and Self Discipline?

Will power is the ability to control inner unnecessary and harmful impulses. It is the ability to overcome laziness and procrastination. It is the ability to arrive to a decision and follow it with perseverance until its successful accomplishment. It is the inner power that allows you to refuse to indulge in unnecessary, useless habits and grants you the strength to overcome inner resistances. It is one of the corner stones of success, spiritual and material.

The human being is full of inner unconscious, or partly conscious, impulses. People sometimes say or do things they later regret saying or doing. On many occasions people do not think before they talk or act.

Self-discipline is the companion of will power. They usually come together. Self discipline gives the stamina to persevere in whatever one does. It bestows the ability to withstand hardships and difficulties, whether physical, emotional or mental. It grants the ability to reject immediate satisfaction for something better.

By developing these powers it is possible to gradually become more and more aware of the inner subconscious impulses, and gain the ability to ignore them when they are not for our own good, without any effort. By developing will power and self-discipline we become powerful.

Will power and self-discipline help us to choose our behavior and reactions instead of being their slaves. Don't think that life will become dull and dry in this way. On the contrary, you will feel more powerful, in charge of yourself and your surrounding, and consequently much more happy and satisfied.

How many times have you felt too weak, lazy or shy to do something? You can gain inner strength and the ability to decide whether to act or react, or refuse to act or react in any situation. Believe me, it is not difficult to develop will power and self-discipline. If you are serious and are willing to experiment, you will certainly succeed.

At the end of this article you will find some exercises and techniques to develop these abilities. You can perform these exercises anywhere, and at any time. Go slowly and gradually and your powers will increase. The desire and ambition to practice these exercise will develop and strengthen your self-discipline

There is a misconception in the public mind regarding will power. It is erroneously thought to be something strenuous and difficult, and that one has to exert and tense the body and mind when expressing it. It is a completely wrong concept. This is one of the reasons why people avoid using it, though they are conscious of its benefits. They acknowledge the fact that the employment of will power in their life and affairs will greatly help them, and that they need to strengthen it, yet they do nothing about it.

Will power gets stronger by holding back and not allowing the expression of unimportant, unnecessary and unhealthy thoughts, feelings, actions and reactions. If this saved energy is not allowed expression, it is stored inside you like a battery, and it becomes available at the time of need. By practicing the exercises you develop your powers the same way as someone who engages in bodybuilding builds his muscles. When you exercise your will power you strengthen your self-discipline and gain inner strength. The more you exercise, the stronger you become.

Developing Will Power and Self Discipline

One way to develop and improve this ability is to practice doing disagreeable things in your daily life. Your mind and feelings may oppose this action, nevertheless, do it. By doing something you do not like or are too lazy to do, you overcome your subconscious resistances, train your inner powers and gain strength. Muscles get stronger by resisting the power of the barbells. Inner strength is attained by overcoming inner resistance.

Here are some exercises:

- You are sitting in a bus or train and an old man or woman, or a pregnant lady walks in. Stand up and give up your seat even if you prefer to stay seated. Do this not just because it is polite, but because you are doing something that you are reluctant to do. In this way you are overcoming the resistance of your body, mind and feelings.

- There are dishes in the sink that need washing, and you postpone washing them for latter. Get up and wash them now. Do not let your laziness overcome you. When you know that in this way you are developing your will power, and if you are convinced of the importance of will power in your life, it will be easier for you to do whatever you have to do.

- You come home tired from work and sit in front of the T.V. because you feel too lazy and tired to go and wash yourself. Do not obey the desire to just sit, but go and have a shower

Positive Thinking vs. Mental Misery

2004-12-07T08:30:00.000-08:00

Evaluate mental strength and weakness of your mind. Liberate yourself from Negative Sense.

Underware...hardware..software... virtual....What about Footware

2004-12-06T22:21:00.000-08:00

You can buy hardware..software as well as underware... yes the largest sale is WOMAN APPARALs. Especially lingaries and bras and what not. Jewllery, mobile all are traded and shopped but, have you ever imagines buying Shoe in virtual world.

According to traditional wisdom, shoes should be a tough item to sell online. Who buys shoes without trying them on? One manufacturer's Size 9 is another's Size 8. And can you really fall in love with a pair of shoes by looking at a photo?

Yet Shoebuy has figured out a method of tempering customer doubts -- in fact, the site has developed a series of techniques to sell an item that consumers have traditionally needed to see in person.

First, the site offers free shipping -- and free return shipping. If you don't like your purchase, it'll cost you nothing to send it back. And there's no hidden clause, like "purchase must be over $35." Free shipping means even a $15 pair of shoes can be purchased and returned at no customer expense.

In other words, Shoebuy is willing to lose money on some transactions to assure customers that buying shoes online is risk-free. Consequently, the site's return rate is about 16 percent, says Shoebuy CEO Scott Savitz. This number has remained pretty consistent since the site launched, he says, with a slight downward trend now that the site has a greater percentage of repeat customers.

"We've always offered free shipping, from Day One," says Savitz. "What happens is that people make their first purchase, and they think 'I'm not going to lose anything.' And they find out it works out extremely well, and they buy an awful lot more."

Replicating Brick and Mortar
To sweeten its offering, Shoebuy offers a 110 percent price guarantee on any shoe purchase. "So if you're seeing a lower price on another site, we will look at what we're offering it for and give you 110 percent of the difference," Savitz says, noting that this offer is rarely used by his site's customers.

To replicate the brick and mortar shoe buying experience, Shoebuy offers live phone help. This is a "huge" part of the site's success, Savitz says. All of its calls are answered in-house -- he feels that outsourcing phone support ultimately proves ineffective -- by a team of about 20 trained sales personnel.

To go a step above brick and mortar, Shoebuy offers a selection not found in an average shoe store. The site partners with over 200 footwear brands, allowing it to offer about 300,000 products.

Automated Merchandising
Shoebuy's e-commerce platform is completely proprietary, built by in-house programmers. Likewise, its Web analytics software was also coded in-house, and Savitz says attention to the analytics data is non-stop.

"We do a lot of A-B testing, and funneling, and clickstream analysis, so we look at are they getting to where they want to be?" he says. By his account, the site gets 2 million unique users per month. During the workday, until about 5 pm, it sees 3,500 to 4,000 queries per minute, from shoppers clicking on product links. The average visit is 18 minutes long.

The Crucial Link: Strategy to Execution

2004-12-02T09:03:00.000-08:00

Great strategy, poor execution” is the excuse most frequently offered by the CEOs and boards of directors of unsuccessful companies. The last decade provides many examples. C. Michael Armstrong purchased cable companies to help the AT&T Corporation bypass local telephone companies to gain access to the home. Thomas Middelhoff committed to a digital future for Bertelsmann AG. Motorola, when it was led by Christopher Galvin, stood steadfastly behind the development of Iridium satellites to serve travelers’ needs for global cell phone coverage. Under Kenneth Lay, Enron spawned a series of knowledge-based businesses.

All of these concepts sounded good; many reflected accurate insights into industry dynamics and appreciation of customer needs. Yet all were unsuccessful. Is it fair to say that these companies had “great strategies” but simply failed to execute? The knee-jerk reaction to this question by many contemporary businesspeople would be “sure, it happens all the time.” But that’s just plain wrong. “Great strategy, poor execution” is, in fact, a pernicious oxymoron, rooted in ineffective concepts that sharply separate the formulation of strategy from its execution, and assume that there is a linear, sequential relationship between the two. These dangerous misconceptions come in four flavors:

The first views strategy purely as insight into industry dynamics and customer needs, evaluated on the basis of novelty, distinctiveness, analytical depth, or intellectual elegance — rather than on results achieved.
The second considers strategy as the long view, a step-by-step plan toward a comprehensive vision of a future 15 to 25 years distant — ignoring the reality that timing matters.
The third views strategy solely as the province of the CEO and the board of directors, which leaves others in the organization to address the grubby details of execution — and fails to mobilize the people who are best equipped to understand emerging opportunities.
The fourth misconception positions strategy as the first and most important driver of decisions about organization and operations — instead of basing strategy on the company’s core strengths and competencies.

Get more insight from BEST MANAGEMENT BOOK:Strategy recommended by Strategy+Business.

IDC: Windows Server Revenues Essentially Equal Unix Market in Q3

2004-12-02T00:11:00.000-08:00

Windows servers grew revenues by 13.3 percent over the comparable quarter in 2003 to hit $3.9 billion. Unix server revenues fell 2.3 percent compared to the year-ago quarter to $4.0 billion.
"Quarterly revenue of $3.9 billion for Windows servers represented 33.9 percent of overall factory revenue, essentially equal in size to the Unix market," IDC said in a statement.

Is branch growth enough in India, Thailand?

2004-12-01T22:16:00.000-08:00

Aggressive branch expansion plans in India and Thailand may not be sufficient to achieve ideal branch penetration levels, and may even be futile for smaller Thai banks pressured into following a trend.

Asian Banker Research estimates that the number of bank branches in India may grow within 1.7 to 2.5 percent in the next two years. At least 1,200 new branches will be opened to add to the current 68,000. Statements from major Thai banks indicate that at least 350 new branches will be opened by 2006, an increase of about nine percent from their current 3,864 branches.

Considering Indian banks’ branch expansion plans, the country’s inhabitants-to-branch ratio, is forecasted to be about 16,144 by 2006, an increase from about 15,000 registered in 2002. In Thailand, the increase in the number of branches by 2006 will result to an inhabitants-to-branch ratio of 16,729, a negligible improvement from 17,166 in 2002.

In both cases, average population growth is expected to offset aggressive branch expansion plans. Noting the population trends and the lack of bank branches in some areas in India and Thailand, banks in these countries are advised to think that they may have to open more branches to meet ideal branch penetration levels.

Read the full article at ASIAN BANKER.

P2P - Purchase to Pay Process

2004-11-30T06:57:00.000-08:00

Processing financial supply-chain (FSC) transactions is a burden carried by all businesses. However, the size of this burden varies considerably from business to business and varies irrespective of business type or business sector.
Why is this?
Why is it that two businesses buying similar products from the same vendor/supplier arrive at two very different cost models for processing what would appear to be very similar financial transactions? And

why is it that the perception of risk is so different that these two businesses will have widely different control and authorisation processes?

What aspects of their purchase-to-pay (P2P) process are so different, that those businesses that operate the most cost-effective world-class P2P processes are able to process a purchase order (PO) through to settlement for one tenth of the cost incurred by other businesses? (Refer to DIEBOLD awarded with Excllence )

A guideline cost for a European business to process a PO through to payment using reasonably manual processes is around €32 (£22). The same PO, if processed automatically, would cost less than €3 (£2), about one tenth of the cost of a manual PO.

Businesses that operate world-class P2P processes manage to process transactions faster, with much greater efficiency and at a lower cost, and also achieve higher levels of transaction quality than most other businesses. What are the key attributes of their process model that enables them to achieve such dramatically different results? A number of these attributes are discussed within this paper.
Please click here to read the full article.

Five Technologies that will Change Banking

2004-11-30T06:32:00.000-08:00

Banks are among the biggest spenders on technology. The amount of spend is a source of pride for some institutions, but it is the extent to which they are spenders on technology rather than investors in technology that we should bring into question.
It is not uncommon for banks to spend upwards of 80 per cent of their IT budgets on the replacement of legacy systems and regulatory compliance. It can be a struggle in this environment to drive innovation and bring new services to market, especially for smaller institutions.

There are few technologies which can help business managers and product managers to take their innovations and de-risk products which customers can find really convenient to use. Let us look at this tehnologies on how it can impact the product thinking of the banks.

SWIFTNet. The interbank communications network has just been upgraded to use Internet Protocols, a plumbing improvement that should enable the development of new real time/interactive services. But just as pre-broadband slowed to a crawl between the exchange and the home, so the promise of SWIFTNet needs to overcome the barrier between the bank's SWIFT Alliance Gateway and its banking applications, many of which are still batch processors. Interactivity needs to reach deeper into the heart of the banking system.

Web Services. Integration between disparate systems remains a stubbornly complex, time consuming task 10 years after the first vendor thought it would be a bright idea to use 'plug and play' and 'seamless integration' in the marketing brochure. EAI, Bus topology, Subsribe return, Adaptors are old technology jargons found their graves.
Vendors stubbornly repeat these promises despite all evidence to the contrary - perhaps because their clients want to believe in them so much. The vendor and client are seamlessly integrated in a consensual delusion. Web Services are the latest attempt to solve the integration issue and who knows? They might just work.

One of the example of RSS feeds which has changed the way content can be delivered to the desktop of individual interested visitor. I acknolwedge that XML is also taking it's toll like my previous posting of useage of IFX protocl by POS and AMT manufacturer for evolving next version of their products which are talking to BASE24 from ACI - Back end transaction processing plateform.

Mobile Phones. The mobile phone is the payment instrument of the future. Banks only handed out plastic cards because they could be carried everywhere and stuck into machines. People now reach for their mobiles before reaching for their wallets. Looking at the Simpay initiative from Vodafone, T-Mobile and others or the FeliCa mobile wallet from NTT DoCoMo it is not hard to imagine a day when your mobile account becomes your bank account, or when banks start to issue mobiles in preference to thin plastic rectangles.

Another example of using Bluetooth technology in ATMs. U are standing in queue at the other end with distance of 10 men and women in between you and ATM. With your blue tooth enabled cell phone, u can talk to bluetooth enabled ATM and perform your transaction request while in queue.

Moment you insert your card, Bingo ... u got your cash, card and receipt all together and bingo on your way to car. Test are going on for such things and more, offline ATM storing your history of transaction to suggest new product or repeated cash amount from your preferred account with display of last five transation before you press "CANCEL"

Open Source Development. Banks face a huge host of problems, some of which are particular to an individual bank but most of which are common issues across all institutions. If airlines operated in the same was as banks, they would all be building their own aircraft and trying to compete with each other that way. Proprietary solutions to common problems are not the way of the future. A community approach to applications development would support standardisation, which is what clients want, and reduce total cost of ownership, which is what bank shareholders want. It is in line with SWIFTNET and REUTERS which are the common tresurery Weapons used by practically all the tresurery. Their other gizmos are BLOOMBERG terminals to view their market place in colorful way. I call all of them as high end "UTILITY Computing platforms". I hope IBMers are HPs are wathcing the same writings as I.

Unified Modelling Language (UML). No matter how development is undertaken - open source or otherwise - the biggest challenge in any IT project is the prosaic matter of requirements management. The yawning gap between what the business wants and what the project team thought the business wanted is all the more pressing now that so much development work is done offshore. Structured modelling techniques such as UML can bridge the divide - any business person wringing their hands at the latest project delay or cost overrun should get themselves on a course ASAP.

There are a number of new technologies that hold great promise - endless possibilities and opportunities. The extent to which banks can explore and exploit these opportunities will be given by the degree to which they can embrace common solutions for common problems. This will free up time wasted on the maintenance of proprietary legacy solutions and enable institutions to be earlier adopters of new technology.

New face of ATM(Automated Teller Machine)

2004-11-29T09:35:00.000-08:00

“IFX” -- not just another bank computer acronym to file and forget – it’s the key to integrating the ATM channel with Internet banking, the call center and the rest of the enterprise.

The ATM industry is undergoing the most significant transformation in its history, Stephen Risto, director, ATM Software Center of Expertise, NCR, said during a Wednesday afternoon session. Potential changes involve a richer set of functions, open standards, response to Check 21, regulatory compliance, relationship marketing, personalization and enterprise integration.

Every component of the software stack on an ATM is in flux at this moment, Risto said. “There’s strong industry consensus on the primary technologies for ATMs for the next five to 10 years.”

Those include the Windows operating system, the SNMP protocol that carries detailed information about the health of the machine, the TCP/IP communication protocol that enables integration with the rest of the bank, and client-server architecture that enables the full applications needed to provide customers with the services they want on today’s ATMs.

Among the most notable is IFX, or “Interactive Financial eXchange,” a business messaging standard developed by the financial industry and technology providers. It is vendor-independent, eliminating proprietary formats. Most important, IFX can be used by multiple channels.

For customers, that means consistent services and branding across channels and a consistent user interface. For the bank, it means a common infrastructure that enables re-use of applications, tools, and staff skills across channels.

George Throckmorton, senior marketing manager, ACI Worldwide, Sandston, Virginia, said there is no deviation from the standard among vendors so far. The standard is developed and protected through an organizational structure that includes a board of directors, steering and architecture committees and working groups that focus on specific applications such as electronic bill presentation and payment, business banking, credit application processing, insurance, ATMs, point of sale and branch and Web services.

First National Bank of Omaha, which has more than 350 ATMs and customers in all 50 states, plans to start obtaining the benefits early in 2005. Scott McCormack, director of Self-Service Banking, said the company started its migration to IFX in late 2001 as part of complying with requirements for Triple DES encryption and accommodation of customers with disabilities.

Retail Delivery '04 wrap-up

2004-11-29T07:45:00.000-08:00

One can see a fake volcano, faux Eiffel Tower, phony pyramid and other unreal objects on a quick tour of Las Vegas, the city that has elevated artificiality into an art form.

But inside the Las Vegas Convention Center, it was the real deal for attendees of last week's BAI Retail Delivery Conference and Expo. They were wowed by some of today's latest and greatest financial self-service technology.

Not quite ready for Triple DES? Vendors want to help. Front and center in the KAL booth was the software developer's upgrade kit, which includes a Triple DES-compliant EPP (encrypting PIN pad) and processor, along with KAL's multi-vendor Kalignite NDC application.

Triton showed an upgrade kit that will essentially transform its legacy 9500 into a 9100, its popular entry-level ATM, at a price point that Triton President Brian Kett called "very, very attractive."

Thales was promoting a trade-up program that offers a 25 percent discount off its HSM 8000 host security module, along with one year of free support and maintenance and two days of free training, for ATM operators trading in their Atalla A10000E unit . The Thales HSM processes 800 transactions per second, compared to 540 tps for the Atalla model.

The skinny on software: Wincor Nixdorf has four German customers running thin client ATM applications, rather than the usual fat client, on some 15,000 ATMs. In a thin client environment, applications are updated on a server rather than the ATM itself, making it simpler and less expensive to manage a network, said Scott Hackl, vice president of Wincor's Banking Solutions USA.

Counting on coins: mCom demonstrated its Darwin software, which allows financial institutions to update content at kiosks, ATMs and other devices using a browser-based control panel, with a child-oriented coin-counting application.

An animated parrot named Penny invites kids to dump their coins into a counter, which dispenses an itemized receipt they can exchange for cash at the teller window. Two FIs that have installed the counters have seen lobby traffic "go through the roof," said Dan Stechow, mCom's chief operating officer.

ervice for sale? Rumor has it that a large third-party service company may be pondering a sale to an ATM vendor looking to beef up its service infrastructure in the United States.

And then there were… Two transaction processors -- practically the only independents left after the Royal Bank of Scotland purchased Lynk Systems in September -- are reportedly talking to potential buyers as well.

Serve the customer: Wachovia spent a whopping $100 million to improve customer service following its 2000 merger with First Union. "You cannot sell enough product to make up the loss from customer attrition," said G. Kennedy Thompson, Wachovia's chairman, president and chief executive officer. The investment paid off; attrition levels have fallen from 20 percent in 2000 to 10.5 percent today.

Fire his hairdresser: A Donald Trump impersonator, wearing what looked like an orange fright wig, entertained attendees several times a day in Fiserv's booth.

Intriguing interface: Diebold showed a concept ATM that utilized a dial-like device called a haptic user interface, rather than a keypad, for PIN entry. One could enter PINs and select transactions by twirling the dial, then pressing a button that felt a bit like a computer mouse. The device would eliminate shoulder surfing and provide a more intuitive interface for users with disabilities, said Jim Block, Diebold's director of advanced technology.

While I had trouble entering my PIN, I was not weaned on electronic games -- not so the next generation of ATM users.

Free of fees: Thanks to both Diebold and Triton for offering surcharge-free ATMs in the exhibit hall. The machine in my hotel lobby charged $3, which was more than this frugal user wanted to pay. Bill Jackson, Triton's chief technical officer, said some $7,000 was dispensed from his company's machine, which used cellular technology rather than a traditional phone line for connectivity.

Persistence pays: Trusted Security Solutions is adding a persistent key component to its A98 Initial Key Establishment System that will allow the first half of a cryptographic key to be injected into an ATM either at the factory or during installation. Then a single service technician can visit the machine to inject the second half of the key.

The method is less costly and more secure than the usual practice of dispatching two technicians with key components to ATMs, said Dennis Abraham, the company's president.

Checks and balances: Vero, a company founded by retail ATM pioneer Dave Grano, is introducing an automated check cashing solution designed to help FIs move non-customers cashing checks away from the teller line. A teller enrolls the user in the system; thereafter the user can cash his checks at an ATM equipped with an image scanner.

Vero will install its first system at a branch of California's Palm Desert National Bank in December. PDNB also plans to make the product available to its vault cash clients, primarily ISOs who may be interested in offering it to retailers.

CashWorks has grown its check cashing customer base to some 3,000 locations since it began offering the service at two new terminals that totally automate the process. Previously, a clerk or other party had to initiate the process at a point-of-sale terminal.

Will Sowell, the company's general manager, said CashWorks also plans to target FIs, many of whom are interested in attracting new customers that currently do not have bank accounts. Check cashing offers a way to get those potential customers into a bank branch, Sowell said.

Another newcomer, Financial Payments, demonstrated its automated check cashing service in both the Tidel and Tranax booths. Brent Turner, the company's chief operating officer, said Financial Payments offers users the ability to load their funds onto a prepaid debit card that can be activated right at the ATM/kiosk.

Entry level ATMs: Both NCR and Diebold debuted ATMs designed to be the most compact and cost effective members of their flagship product lines. In NCR's case, the Personas 62 replaces its EasyPoint 55 and EasyPoint 57. Diebold's Opteva 500 supplants its CashSource Plus 200 and CashSource Plus 400. The new models, unlike those they displaced, feature full-blown PC processors.

ATM service, the movie: Bank employees or other folks performing first-line ATM service on Diebold ATMs can view step-by-step video instructions on procedures such as clearing paper jams on the service screen in the rear of its machines.

Facing down fraud: Several vendors, including Wincor Nixdorf, NCR and Diebold, demonstrated devices designed to thwart both card skimming and card trap schemes at ATMs. An idea that would be extremely simple and inexpensive to implement, seen in NCR's booth, was a screen graphic with text that read: "If the ATM card reader does not look like this, do not use it."

Easy integration: A TRM executive attending the show said the conversion of 17,000 ATM contracts it purchased from eFunds Corporation will likely be one of the simplest in industry history. "They were on eFunds yesterday, and they'll be on eFunds tomorrow," he said, noting that eFunds will continue to provide transaction processing and other services for five years.

Learning curve: Panelists in a session entitled "Check 21: From Compliance to ROI" agreed that the industry needs to address several issues related to check imaging, including the quality of images. One panelist noted that while quality has improved, it remains far from perfect.

"We're not out of the woods yet," he said, noting that his institution experienced problems with checks that featured a graphic of an American flag - a popular style with patriotic customers.

Site surveys: Both MapInfo and Claritas offer services that they say will help FIs pinpoint the best new locations for ATMs (and bank branches) by analyzing such factors as household incomes of area residents and proximity to existing ATMs.

Bill Harvey, vice president of Claritas' National Accounts Group, said Claritas, can drill down into data to, for instance, pinpoint differences between daytime and night time populations. "You might have a large workforce population during the day that wouldn't be there at night, which is something that you'd want to know."

POS product: Level Four, which markets simulation tools for ATMs, introduced a similar product for POS terminals. The simulator allows users to test of any kind of transaction, online or offline, initiated with either magnetic stripe or chip cards. Jorge Fernandez, president of Level Four Americas, called the new product a "natural step," noting that many FIs operate both ATM and POS networks.

Real-time review: A new product called Transaction Surveillance, demonstrated by software developer Integrated Research, will help clients determine the causes of failed or declined transactions in real-time, by allowing them to analyze transactions by acquirer, issuer and other factors, using a browser-based interface. Integrated Research's clients include switches like Fiserv and Concord EFS, as well as FIs like Wells Fargo and Citibank.

On with a different show? Several major ATM manufacturers, reportedly dissatisfied with the cost of exhibiting and the limited exposure to new prospects at large shows like Retail Delivery, are quietly trying to recruit other companies to participate in an entity that would present a series of smaller regional trade shows. The new group would, in theory, give smaller companies more equitable representation on the exhibit floor, according to a software vendor familiar with the proposal.

Today is Sikh Guru Nanak Jayanti

2004-11-26T07:42:00.000-08:00

Today is Guru Nanak Jayanti. Guru Nanak was influenced by Hindu, Muslim and Sufi philosophy of India.

The founder of the Sikh religion, Guru Nanak was born on April 15, 1469 in the Western Punjab village of Talwandi. He was born to a simple Hindu family. His father Mehta Kalian Das was an accountant in the employment of the local Muslim authorities. From an early age Guru Nanak made friends with both Hindu and Muslim children and was very inquisitive about the meaning of life. At the age of six he was sent to the village school teacher for schooling in reading and writing in Hindi and mathematics. He was then schooled in the study of Muslim literature and learned Persian and Arabic. He was an unusually gifted child who learned quickly and often question his teachers. At age 13 it was time for Guru Nanak to be invested with the sacred thread according to the traditional Hindu custom. At the ceremony which was attended by family and friends and to the disappointment of his family Guru Nanak refused to accept the sacred cotton thread from the Hindu priest. He sang the following poem;

"Let mercy be the cotton, contentment the thread, Continence the knot and truth the twist. O priest! If you have such a thread, Do give it to me. It'll not wear out, nor get soiled, nor burnt, nor lost. Says Nanak, blessed are those who go about wearing such a thread" (Rag Asa)

Early one morning accompanied by Mardana, Guru Nanak went to the river Bain for his bath. After plunging into the river, Guru Nanak did not surface and it was reported that he must have drowned. The villagers searched everywhere, but their was no trace of him. Guru Nanak was in holy communion with God. The Lord God revealed himself to Guru Nanak and enlightened him. In praise of the Lord, Guru Nanak uttered;

"There is but One God, His name is Truth, He is the Creator, He fears none, he is without hate, He never dies, He is beyond the cycle of births and death, He is self illuminated, He is realized by the kindness of the True Guru. He was True in the beginning, He was True when the ages commenced and has ever been True, He is also True now." (Japji)

"Let God's grace be the mosque, and devotion the prayer mat. Let the Quran be the good conduct. Let modesty be compassion, good manners fasting, you should be a Muslim the like of this. Let good deeds be your Kaaba and truth be your mentor. Your Kalma be your creed and prayer, God would then vindicate your honour." (Majh)

Thus having spread the words of reform throughout his lifetime, Guru Nanak successfully challenged and questioned the existing religious tenants and laid the foundations of Sikhism.
Detail on Biography of Guru Nanak dev please click.

German railway on track with Linux migration

2004-11-26T04:00:00.000-08:00

The company responsible for managing the German railway system is partway through migrating its servers to Linux, and expects to have more than 300 Linux servers in operation by the end of 2004, as part of a cost-saving initiative.

Deutsche Bahn (DB), which manages the German railway system, is moving from an infrastructure based on IBM Mainframes, and Solaris, Windows and HP Non-Stop servers, to a standardised infrastructure primarily based on the Linux running on Intel servers and mainframes.

Detlef Exner, the managing director of DB Systems, said the company decided to move to Linux as part of a short-term plan to cut costs. The migration to the open-source operating system is due to be completed in 2006 or 2007.

"DB Systems has major targets to reduce costs and increase the service levels," said Exner. "One of the main strategies to achieve this is to implement Linux."

But not all applications are due to be migrated as the decision has primarily been made for cost rather than technical or strategic reasons, according to Exner.

"If we wanted to transfer everything to Linux it would cost a lot of money. We are interested in saving money in the short term -- over the next two to three years -- not over 10 years."

Applications will only be migrated if there is a business reason. Applications which would require extensive rewrites, or for which the company has recently purchased a Solaris machine, are less likely to be migrated, said Exner.

Exner said it is initially migrating applications which are available on multiple platforms, such as Lotus Notes, SAP and HP Non-Stop applications.

It has migrated some of its email servers from Solaris running z/OS to Linux, so an estimated half of its 55,000 Lotus Notes users are now being served by a Linux server. This migration is due to be completed at the end of the year as its z/OS licence is due to run out on 1 January, 2005.

DB is also migrating parts of its SAP system from Solaris to Linux, and started transferring all HP Non-Stop applications to Linux at the start of October.

Exner was unable to say how much DB would save with these migrations, but said the expected cost savings are higher when migrating from a mainframe or HP environment, than when migrating from a Solaris or Windows platform.

"The transfer of HP Non-Stop applications will result in a major cost reduction," said Exner. "Last year we compared the costs of our major platforms -- IBM Mainframe, HP Non-Stop Server, Solaris server and Windows server -- with Linux. We found out that Solaris and Windows server are quite expensive, while mainframe computing and HP are much more expensive."

Later this year DB is due to start migrating its Adabas databases and it Web server technologies -- JBoss, Tomcat, Apache and Weblogic -- from Solaris to Linux. This transfer will be finished next year.

DB has chosen to use a combination of Red Hat and SuSE Linux, as it is not obvious which is really leading the market, said Exner.

"We chose to use both as the market is not really clear -- we didn't want to back ourselves into a corner," said Exner. "Red Hat has a strong market in the US, and SuSE has backing of Novell. The market is not very clear so we wanted to be independent."

Before moving to Linux, DB set up a standardised environment for both Red Hat and SuSE Linux on both the Intel and mainframe platform to make the systems easier to install and maintain. This set-up has not only reduced the time it takes to install and maintain the servers, but has also given the company flexibility in service levels, as applications can be shifted from an Intel server to a mainframe depending on the system resources required.

"It takes three hours to set up a Linux server, while in the past it took up to three weeks -- due to standardisation," said Exner. "Also, we can easily shift applications from an Intel server to a mainframe -- we can therefore decide on the service level, if we want a high service level we use the mainframe."

As for future plans, DB may move to Linux on the desktop in the future, but nothing has been decided yet. "We expect to make a decision in the next year -- we will see if it is profitable," said Exner. "We currently have about 55,000 desktops."

Wisdom - The Three Fold ways of Buddhism

2004-11-25T08:19:00.000-08:00

The aim of all Buddhist practices, including meditation, is prajna, or wisdom. The Buddha taught that the fundamental cause of human difficulties is our existential ignorance - our failure to understand the true nature of reality and wisdom is the opposite of this.

To start with, we simply need to hear the teachings that indicate the Buddhist vision of life. Then we need to reflect on them and make sense of them in relation to our own experience. But prajna proper means developing our own direct understanding of the truth. It is not enough to know the Buddha's philosophy, or even to have a good understanding of it. The ultimate aim is to realise the truth for oneself and to be transformed by that realisation.

The Buddha taught that life - everything we experience - has three characteristics. He called these the three marks of conditioned existence. Firstly he said that all life is dukkha, or unsatisfactory. He also said that it is impermanent. Everything in the universe, including ourselves and the thoughts that make up our minds, is in a constant process of change. And yet we act as if the world around us is predictable and stable, and we live our lives as if death were not a certainty. Buddhists reflect on the fact of impermanence, and try to live with this understanding. Thirdly, wherever we may look in life for something something solid and unchanging, we only find flux. So he said that all existence is anatta or insubstantial. There is no fixed, abiding essence to things, and no eternal soul within human beings.

A person who is wise in the Buddhist sense will naturally see life in terms of these qualities or marks, and prajna means setting aside the pleasing illusions that we adopt to make life comfortable, and to live more and more on the basis of these truths. A full comprehension that nothing lasts, or has anyfixed substance, has an utterly transformative effect. This also means that everything in life is interconnected: no individual is entirely separate from other individuals, and humanity is not separate from the world it inhabits. From this naturally arises compassion, or universal loving-kindness, which is the counterpart of wisdom.

Meditation - The Three Fold ways

2004-11-25T08:17:00.000-08:00

There are many things in life that are beyond our control. However, it is possible to take responsibility for and to change one’s state of mind. According to Buddhism this is the most important thing we can do, and Buddhism teaches that it is the only real antidote to the anxiety, hatred, discontentedness, sleepiness, and confusion that beset the human condition.

Meditation is a means of transforming the mind. Buddhist meditation practices are techniques that encourage and develop concentration, clarity, and emotional positivity. By engaging with a particular meditation practice one learns the patterns and habits of the mind, and the practice offers a means to cultivate new, more positive ways of being. With discipline and patience these calm and focused states of mind can deepen into profoundly tranquil and energised states of mind. Such experiences can have a transformative effect and can lead to a new understanding of life.

Over the millennia countless meditation practices have been developed in the Buddhist tradition. All of them may be described as 'mind-trainings', but they take many different approaches. The foundation of all of them, however, is the cultivation of a calm and positive state of mind.

Each year thousands of people learn meditation with the FWBO. They learn two basic meditations that develop these qualities: the Mindfulness of Breathing and Loving-Kindness meditation or Mettabhavana.

ETHICS -the threefold way

2004-11-25T08:07:00.000-08:00

Another formulation of the path is the Threefold Way of ethics, meditation, and wisdom. This is a progressive path, as ethics and a clear conscience provides an indispensable basis for meditation, and meditation is the ground on which wisdom can develop.

Ethics

To live is to act, and our actions can have either harmful or beneficial consequences for ourselves and others. Buddhist ethics is concerned with the principles and practices that help one to act in ways that help rather than harm.

The core ethical code is known as the five precepts. These are not rules or commandments, but 'principles of training', which are undertaken freely and put into practice with intelligence and sensitivity. The Buddhist tradition acknowledges that life is complex and throws up many difficulties, and it does not suggest that there is a single course of action that will be right in all circumstances. Indeed, rather than speaking of actions being right or wrong, Buddhism speaks of the being skilful (kusala) or unskilful (akusala).The Five Precepts are as follows:

1. Not killing or causing harm to other living beings. This is the fundamental ethical principle for Buddhism, and all the other precepts are elaborations of this. The precept implies acting non-violently wherever possible, and many Buddhists are vegetarian for this reason. The positive counterpart of this precept is love.

2. Not taking the not-given. Stealing is an obvious way in which one can harm others. One can also take advantage of people, exploit them or manipulate them - all these can be seen as ways of taking the not-given. The positive counterpart of this precept is generosity.

3. Avoiding sexual misconduct. This precept has been interpreted in many ways over time, but essentially it means not causing harm to oneself or others in the area of sexual activity. The positive counterpart of this precept is contentment.

4. Avoiding false speech. Speech is the crucial element in our relations with others, and yet language is a slippery medium, and we often deceive ourselves or others without even realising that this is what we are doing. Truthfulness, the positive counterpart of this precept, is therefore essential in an ethical life. But truthfulness is not enough, and in another list of precepts (the ten precepts or the ten kusala dharmas) no fewer than four speech precepts are mentioned, the others enjoining that our speech should be kindly, helpful, and harmonious.

5. Abstaining from drink and drugs that cloud the mind. The positive counterpart of this precept is mindfulness, or awareness. Mindfulness is a fundamental quality to be developed the Buddha's path, and experience shows that taking intoxicating drink or drugs tends to run directly counter to this.

The Foure Noble Truths in Buddhism

2004-11-25T08:04:00.000-08:00

The Four Aryan (or Noble) Truths are perhaps the most basic formulation of the Buddha's teaching. They are expressed as follows:

1. All existence is dukkha. This word has been variously translated as 'suffering', 'anguish', 'pain', or 'unsatisfactoriness'. The Buddha's insight was that our lives are a struggle, and we do not find ultimate happiness or satisfaction in anything we experience. This is the problem of existence.

2. The cause of dukkha is craving. The natural human tendency is to blame our difficulties on things outside ourselves. But the Buddha says that their actual root is to be found in the mind itself. In particular our tendency to grasp at things (or alternatively to push them away) places us fundamentally at odds with the way life really is.

3. The cessation of dukkha comes with the cessation of craving. As we are the ultimate cause of our difficulties, we are also the solution. We cannot change the things that happen to us, but we can change our responses.

4. There is a path that leads from dukkha. Although the Buddha throws responsibility back on to the individual he also taught methods through which we can change ourselves. One formulation of these methods is known as the Noble Eightfold Path of right view, aspiration, action, speech, livelihood, effort, mindfulness, and meditation.

Dealing with Fear

2004-11-25T06:33:00.000-08:00

We suffer and come across fear on our day to day life. Some are not worthy to remember but some create dangerous pattern in our mind. I went to search for root cause analysi and hit by systametic explanation of Fear and how can it be managed.

Excerpt of posting on THARPA website is given below. Click here to read Full length analysis.

According to Buddhism, there is unhealthy fear and healthy fear.

For example, when we are afraid of something that cannot actually harm us - such as spiders - or something we can do nothing to avoid - such as old age or being struck down with smallpox or being run over by a truck - then our fear is unhealthy, for it serves only to make us unhappy and paralyze our will.

On the other hand, when someone gives up smoking because they are afraid of developing lung cancer, this is a healthy fear because the danger is real and there are constructive steps they can take to avoid it.

We have many fears-fear of terrorism, fear of death, fear of being separated from people we love, fear of losing control, fear of commitment, fear of failure, fear of rejection, fear of losing our job, the list is never-ending!

Many of our present fears are rooted in what Buddha identified as "delusions" - distorted ways of looking at ourself and the world around us. If we learn to control our mind, and reduce and eventually eliminate these delusions, the source of all our fear-healthy and unhealthy-is eradicated.

However, right now we need the healthy fear that arises from taking stock of our present situation so that we can resolve to do something about it. For example, there is no point in a smoker being scared of dying of lung cancer unless there is something that he or she can or will do about it, i.e. stop smoking.

If a smoker has a sufficient fear of dying of lung cancer, he or she will take steps to kick the habit. If he prefers to ignore the danger of lung cancer, he will continue to create the causes of future suffering, living in denial and effectively giving up control.

Just a smoker is vulnerable to lung cancer due to cigarettes, it is true that at the moment we are vulnerable to danger and harm, we are vulnerable to ageing, sickness, and eventually death, all due to our being trapped in samsara — the state of uncontrolled existence that is a reflection of our own uncontrolled minds.

We are vulnerable to all the mental and physical pain that arises from an uncontrolled mind-such as the pains that come from the delusions of attachment, anger, and ignorance. We can choose to live in denial of this and thereby give up what control we have, or we can choose to recognize this vulnerability, recognize that we are in danger, and then find a way to avert the danger by removing the actual causes of all fear (the equivalent of the cigarettes) - the delusions and negative, unskillful actions motivated by those delusions. In this way we gain control, and if we are in control we have no cause for fear.

A balanced fear of our delusions and the suffering to which they inevitably give rise is therefore healthy because it serves to motivate constructive action to avoid a real danger. We only need fear as an impetus until we have removed the causes of our vulnerability through finding spiritual, inner refuge and gradually training the mind.

Once we have done this, we are fearless because we no longer have anything that can harm us, like a Foe Destroyer (someone who has attained liberation, defeated the foe of the delusions) or a Buddha (a fully enlightened being). All Buddha's teachings are methods to overcome the delusions, the source of all fears. For an introduction to these teachings, see Transform Your Life.

If - Rudyard Kipling

2004-11-24T20:08:00.000-08:00

If you can keep your head when all about you
Are losing theirs and blaming it on you;

If you can trust yourself when all men doubt you,
But make allowance for their doubting too;

If you can wait and not be tired by waiting,
Or, being lied about, don't deal in lies,
Or, being hated, don't give way to hating,
And yet don't look too good, nor talk too wise;

If you can dream - and not make dreams your master;
If you can think - and not make thoughts your aim;

If you can meet with triumph and disaster
And treat those two imposters just the same;

If you can bear to hear the truth you've spoken
Twisted by knaves to make a trap for fools,
Or watch the things you gave your life to broken,
And stoop and build 'em up with wornout tools;

If you can make one heap of all your winnings
And risk it on one turn of pitch-and-toss,
And lose, and start again at your beginnings
And never breath a word about your loss;

If you can force your heart and nerve and
sinew To serve your turn long after they are gone,
And so hold on when there is nothing in you
Except the Will which says to them: "Hold on";

If you can talk with crowds and keep your virtue,
Or walk with kings - nor lose the common touch;

If neither foes nor loving friends can hurt you;
If all men count with you, but none too much;

If you can fill the unforgiving minute;
With sixty seconds' worth of distance run -
Yours is the Earth and everything that's in it,
And - which is more - you'll be a Man my son!

The Weakest Security Link of Security Architecture

2004-11-23T00:13:00.000-08:00

I always admired aspect of technology in the hand of few. Large Size IT operations always have problem of delegation versus controlling. For better response to IT Users, IT administrators are given more free hand but, darker side of more authority proving at perimeter of organisation.

PC Magazine and Gartner has started researching and cautioning more to all CIOs and CSO about strengthing the weakest link. Decision maker are already finding difficult to balance cost for enhancing security with the increase in revenue contributed by such security in vestment. They are hard press with one more important aspect which almost all the seucrity architecture has ignored.

What’s the weakest link in your network security infrastructure: your firewalls, antivirus systems, telecommuter PC, road-warrior notebooks? Here’s a hint: Go look in the mirror. Most security experts agree that a clever hacker can penetrate almost any network simply by asking the right users for the right information. Using a variety of manipulative techniques—together known as

Social engineering—that exploit a human being’s natural desire to trust and help others, or to gain something for nothing, hackers can learn user names, passwords, and other information that allows them to penetrate networks—even those secured with the most advanced technology.

If you find this hard to believe, take a look at the sidebar “Five Tricks Hackers Use on You” and consider how you might respond in such situations. But the techniques explained there are only a few of the hundreds hackers use to gain valuable information.

In fact, hackers can gain a lot of information without talking to anyone, simply by surfing company Web sites for executive titles, financial information, organizational charts, and employee e-mail addresses and phone numbers. They can also sift through company trash for org charts, employee directories, system and application manuals, marketing plans, memos, company letterhead, human resources manuals, financial printouts, and procedure/policy manuals. Hackers use this information to gain the trust of others through phone calls and e-mails, often masquerading as an employee, customer, or consultant and convincing employees to provide information that can, little by little, get them into company LANs.

The techniques for eliciting information from staffers are similar to those used in any con. They include

• overwhelming the target employee with lots of different information and strange questions or using strange and confusing arguments that make it difficult to process what is happening;

• helping the target with some technical problem, possibly one that the hacker has created. This is often called reverse social engineering;

• making statements that elicit strong emotions or using intimidation tactics;

• in the case of resistance, yielding on one or more small points. After a while the target often feels he must yield to other requests in return;

• sharing information and technology over time without asking for anything in return—at least not at the moment. When it comes time for the hacker to request information, the target feels he must reciprocate;

• pretending to have the same interests as the target, perhaps through information gained in user groups;

• pretending that the target can help a fellow employee fulfill an important commitment that employee has made;

• maintaining a seemingly innocent, friendly relationship with the target during which the hacker learns, bit by bit, company jargon and the names of key employees, servers, and applications.

Remember that a very large percentage of security breaches originate internally from disgruntled employees or from nonemployees—such as consultants, partners, and so forth—who have system access. People rarely question the actions of insiders.

Of course, social engineering doesn’t target only companies. The same techniques are also used against individuals to gain personal information such as credit card numbers, user names, and passwords for accessing popular e-commerce sites. One common technique is phishing, which uses a combination of e-mail messages and fake Web sites to convince users they are dealing with a major company.

If you still have doubts about the efficacy of social engineering, take a lesson from the best. Kevin Mitnick, the notorious late-20th-century hacking superstar has said again and again that he penetrated networks much more easily by manipulating people than by technology.

The truth is that most companies spend a lot more money and resources tackling security with technology than with people. But most products and technologies are not designed to protect against social engineering. So what do you do?

You should approach the problem from two angles: protecting the physical spaces that are commonly penetrated, such as offices, dumpsters, and Web sites, and protecting users through clear policies and ongoing education.

Physical security is the easier part. Here are some important tips, many of which overlap physical security and policy.

• Make sure all employees and visitors wear identification badges. Require that visitors be escorted to their destinations.

• Determine which documents must be kept locked away at all times and which require shredding on disposal.

• Keep your dumpsters in secure, locked, and monitored locations.

• Make sure that all systems, including client PCs, are protected by strong passwords that change frequently. Implement and enforce screensaver passwords that take effect after a few minutes of idle time.

• Encrypt files stored on hard drives that contain confidential information.

• Avoid posting too much information on your public Web site.

Policy and training are harder. Employees may not understand the value of the information they give away. They must be educated continually on how to respond to unknown people requesting information, and they need to be aware of how easily they can be manipulated.

One of the best ways to give employees insight is to hold a training session and before it begins, use social engineering techniques to elicit confidential information from them. Then have the teacher amuse the class by telling them what she or he learned and from whom.

You need to draw up clear policies on what type of information should not be divulged under any circumstances. Seemingly simple tidbits, such as a server name, organizational structure info, or company jargon, can be invaluable to a hacker. Your policies should spell out clear rules for information access, setting up the physical security and safeguards outlined above. Make sure there are clear penalties for violating those policies. It’s much easier for employees to refuse to divulge information if the policy is clearly spelled out.

Tools for fighting social engineering are rare, but content filtering and antispam products, such as MailFrontier Matador, can be configured to detect signs of fraudulent e-mails or to prevent employees from giving away sensitive information. Matador in particular uses a number of patented techniques to detect phishing and other suspicious e-mails.

Fighting social engineering is a continuous battle in which the attackers find clever ways around existing safeguards. It’s important to keep up with the new tactics social engineers use and to implement policies to stop them quickly. And keep reminding employees that they are the true corporate firewall.

3 Maskteer's Glass - Indian Economy 2010

2004-11-23T00:05:00.000-08:00

As posted in ASIA MONEY's article - November 2004.

India is growing strong and has the potential to become one of the world's most vibrant economies. But the country still faces challenges: rampant poverty, a burgeoning budget deficit and a new government. Asiamoney asked three Indian experts - a leading CFO, a fund manager and an investment banker - about the recent elections, reforms and the future of India and its capital markets.

Amit Chandra (AC), joint managing director, DSP Merrill Lynch.
Arindam Bhattacharjee (AB), fund manager, Emerging Markets Management.
Mohandas Pai (MP), chief financial officer at Infosys.

What are the major themes in India's financial markets?

MP: The one major issue that people are talking about is the movement of interest rates. They have bottomed out and could move up despite having adequate liquidity in the market place. The key issue with...rates is what corporates should do if and when they move. Second is consumer demand and growth and what India's growth rate will be for the next four to five years. It could be 7 per cent to 8 per cent p.a. for the next five years (We_d_living: As per C K PRahalad, Research PRfoessor at Michigan Ross University,USA - 10-10 is success formula for India i.e. 10% must be the growth of INDIA )and people are excited and discussing expansion plans for industries like the steel and metals, construction, pharmaceuticals, automobiles, heavy engineering, textiles and the IT industry, where the global market is opened up. Also, everyone agrees that India needs to invest more in infrastructure.

AB: The big issues are: will the new government continue and/or accelerate the economic reform programme and peace initiatives with Pakistan followed by the previous government. And secondly, how quickly will we see interest rates reverse. Finally, after a sharp revival in economic growth led by agricultural production and manufacturing growth, will we see a repeat or a return to 4-6 per cent growth rate?

AC: While the long-term story of strong growth and returns seems to be intact, over a short- to medium-term perspective, the market is being overshadowed by the volatility in flows to emerging markets, the high crude prices and rising inflation, developments in China, and the issue of [the] introduction of turnover tax.

After the elections, there was hundreds of millions of dollars of redemptions by foreign investors out of the Indian stock market. How did this affect the market and has the situation improved? Did you sell down your Indian positions following the elections - have you since re-invested those funds in India?

AC: The stock market did see a sharp 20 per cent plus correction post the elections on the back of a sell-off by both domestic and international investors. However, I don't think the sell-off is something to be over concerned with considering the fact that the Indian markets had nearly doubled over the previous 18 months and that most emerging markets were also under pressure since the beginning of the year, driven by the change in global flows. The situation since then has improved and markets have risen more than 10 per cent from their lows as investors realise that reforms are going to continue and economic growth is expected to remain in the 7-8 per cent range.

AB: The post-election sell-off seemed a bit premature and [a] reversal of the 'froth' that had built up in the markets thanks to a number of new hedge funds and global funds gaining exposure in India. The market has stabilized but remains one of the worst performing emerging markets year to date. We did not sell down our holdings although we have not increased our exposure either.

The government has made an about-face on its privatization policies - what impact is this having on investor sentiment? Does this matter when trying to attract foreign capital?

AB: It is a major negative for attracting foreign capital into India. The government has also slammed the door shut on a significant source for financing its budget deficit (running at close to 10 per cent on an aggregate level, i.e. including [the] states) since it is unlikely to be able to make any concessions on the expenditure side. If economic growth slows this year, affecting tax collection, they could truly regret this decision based on pressure from the Left Front.

MP: The impact has been slightly negative on investors. It is important for foreign investors because the major issue facing India is infrastructure and the government has to invest. They are unfortunately running up a fiscal deficit of 9 per cent of GDP and it could be unsustainable. They need to sell public-sector holdings and use [the money] for infrastructure. Dismantling the public sector creates better efficiencies in the economy - just [as it has] in telecommunications. Oil and gas needs more competition and some areas of manufacturing need momentum for growth. These are two big areas that are important for investors, both in India and abroad.

AC: The new government's policy on privatization has largely impacted the valuations of public-sector companies. However, I believe that the fears are overdone since the government has, through the proposed NTPC offering, already signalled their desire to continue to pursue the sale through [the] capital market route, which was the preferred route even for the previous government. Undoubtedly, India would attract a lot more capital, especially FDI, if privatization through strategic sales were permitted. However, it is very difficult for any government to ignore the political reality and the common man today prefers that the government retain control of most public-sector enterprises. Perhaps we need to wait for the benefits of the past strategic sales to become a lot more evident before the opposition to such sales reduces.

Inflation is hovering around 6 per cent, which is creating negative bond yields. Is this harmful to the development of the bond market - or just part of an economic process?

MP: Inflation is 5.5 per cent to 6 per cent, manufacturing inflation is 5 per cent and fuel inflation is in double digits. It is harmful as savers want positive interest rates. The problem is the financial system is very rigid. Corporate lending rates are between 10 per cent and 11 per cent with 5-6 per cent for the top corporates. There is a gap - prime lending is 10 per cent but companies that are AAA [rated can borrow] at 5-6 per cent - the top [companies] are getting cheap money. Non-prime borrowers and savers are not getting prime interest rates. This is happening because the bond market pays 5.8 per cent for a 10-year bond and regulations require 25 per cent of total deposits to be invested in government bonds. For banks, if they put 25 per cent in government bonds and another 20 per cent goes to prime borrowers at low interest rates, more than 50 per cent, including cash, needs to be lent at high interest rates.

AB: This is a temporary phenomenon. We are likely to see a steepening of the yield curve shortly as the market factors in higher borrowing requirements from the government. The budget provides very ambitious revenue collection targets that are unlikely to be met.

AC: The long-term target for inflation is closer to 5 per cent and it is likely that inflation will soon peak and then commence a reversal over the rest of the fiscal year. I think the markets are reacting normally to the inflation data, showing that the Indian debt markets are reasonably vibrant. Real yields would only have been more negative if the government were to permit greater flows of foreign capital into domestic debt instruments, so perhaps the policies are actually helping achieve a balanced approach.

What capital-raising trends are you seeing for Indian corporates? What is the most vibrant source of funding?

AB: The domestic capital markets. The larger corporates will gain access to other sources of financing - structured deals as they try to grow through acquisitions overseas.

AC: Indian companies are getting capacity constrained and therefore need for capital is increasing. Most companies are coming off a cycle wherein they operated with minimal leverage and, therefore, the preference is for tapping debt sources in the first round. A few companies are looking at raising equity, however these are really in the minority.

MP: The equity market is vibrant but it needs scale and size. There will be IPOs from telecom companies and if they want to do well, companies have to be attractive. The financial system is flush with funds and [there is] $25bn of short term surplus parket with the central bank. There are no borrowers in the market as the corporate sector is very liquid because they are trying to pay back high-cost loans taken out four to five years ago. The debt equity ratio for the entire corporate sector has come down as profits have been good for the last three years.

The rupee has come off of a long run of appreciation and actually depreciated in recent weeks. How is this affecting Indian corporates who do business in US dollars? How does this affect equity investors in India?

AB: Most exporters were worried about the rupee appreciation and should be happier. However, a number of companies have converted rupee loans into dollar loans - a small percentage of them have left these positions open expecting the rupee to appreciate further. [It] might be a shock to them but do not expect [the] rupee depreciation to be significant [enough] from here to cause a shock to the system. Equity investors are unlikely to be affected much.

MP: The 5 per cent appreciation in the last fortnight of March 2004 made people nervous. It does have implications across the economy and a lot of people are getting hurt. But now the rupee is depreciating and creating better confidence in business to be globally competitive. If the currency appreciates 8-9 per cent, it will hurt the manufacturing and export sectors. The impact on equity investors follows. For foreign investors who calculate returns in dollars, a stronger rupee obviously helps.

AC: If you carefully look at the rupee/dollar chart, all that has happened is that a spike in the rupee has corrected and the markets seem to be heading back towards the secular trend that we have witnessed over the past many years. Most Indian exporters are thrilled with the reversal since the sharp appreciation had put a lot of pressure on their margins and also put them at a disadvantage vis a vis competitive countries, particularly China. Equity investors do not seem to be over-perturbed... since they are much more focused on the underlying fundamentals of the stock market. The movements would have impacted debt markets a lot more, but considering the limited exposure on account of caps and other restrictions, we have seen minimal implications.

Now that the budget has been announced, what are your views on how the government is going to reduce the deficit and liberalize the economy? Are they on the right track?

MP: The previous government had a very good approach to opening up the economy but needed to focus more on the social sectors. The government has to look after the poorer citizens of India because without them participating in the liberalization process, the economy will not grow. The new government has said that they will focus on healthcare, education, agriculture and infrastructure. The government can do more and we need greater investment. The deficit has come down. The government can reduce the deficit further by focusing on tax reforms and downsizing the public sector. But the coalition government works under constraints. Within the constraints the budget is a good one as it enhances investment in the social sector and on infrastructure.

AC: The budget is clearly a positive surprise. It's a strong signal that this government has the will and desire to continue to pursue reforms, encourage investment (particularly FDI), and bring down the deficit. Given the severe limitation of time that the government was dealing with, I think the big bang reforms will actually follow in the coming budgets.

What effect will the introduction of a value-added tax have on the economy? What are the pros and cons?

AC: VAT is actually a win-win for the government and the Indian industry. VAT will help remove the internal barriers in the domestic markets, thereby facilitating more efficient flow of goods and services. At the same time, recent experiments have shown that [the] introduction of VAT can actually help raise revenue and help plug leakages that exist within the system.

AB: The introduction of VAT and [its] proper implementation will likely result in a much larger collection of taxes. The tax to GDP ratio in India is in single digits - lower than most other economies in Asia. Proper implementation, though, will be the challenge and the state governments will have to play along. Otherwise, it will not work.

MP: This is a positive - India has about 30 states and five union territories, with each having its own tax structure and borrowings. India is not a seamless national market but a market with multiple state taxes and restrictions on free movement of goods. VAT will bring in a single market and lower the tax base for many corporations because the VAT mean rate will be lower than what they are paying now and will also stop leakages in the system.

The ceilings for FDI in certain industries such as telecommunications, insurance and aviation have been raised. How important is this development to the economy and to the development of these industries? What is the long-term outcome?

AC: This is a very welcome move. Enhanced FDI will help spur investment in these critical segments, which are much needed to spur economic development and employment creation. Importantly, by enhancing FDI in these 'holy' sectors, the government is giving a strong signal that, despite all the opposition, [it] is willing to do what is right from a longer-term perspective.

AB: This was a much-needed relief for these sectors to obtain foreign funding and help them meet their growth objectives - a positive development that will hopefully attract increased FDI.

MP: It is positive because sectors such as telecoms require huge investment. By June 2004, there were 85 million phone lines for fixed and mobile, but by December 2006 India is expected to have 150 million lines. People are looking at doubling the total number of lines and this requires very heavy investment. It also requires accessing capital from all sources and liberalizing the investment cap to give companies in these sectors access to more capital. This move is a positive for these industries. The long-term outcome will be a bigger market, better services and lower costs to consumers.

What changes would you like to made see to the economic reform programme? Where is the government failing to implement positive policy changes?

AB: I would like to see the reduction of subsidies in agriculture, power-sector reforms, acceleration in the pace of infrastructure development, including ports, roads, airports etc, and the reduction of duties/import barriers. [Then there's] infrastructure development and getting private capital to flow into sectors like power, roads etc. There's been no progress on the electricity reform act, and it remains to be seen what happens. States are going back to their old ways - distribution of free power! Oil companies are being forced to carry the burden of subsidies and this creates a bad precedent for investing in government-owned companies.

MP: We need more spending on social initiatives. Every Indian should have access to education and health. The government should intervene more for infrastructure development so more foreign local investors can freely come in with private capital for everything from the airport sector to executing road and telecom projects. We need more economic freedom... with further relaxations in regulations. We need policies for the creation of a national market. We need further disinvestments for the public sector to foster competition. We need a freer land market to enable housing to grow. Further change is required in areas like the tourism sector, the aviation sector, the oil sector and areas of infrastructure. The issue is the pace of change and reform and not the direction of reform.

AC: The need of the hour is rapid simplification of the tax and legal code to enhance efficiency, reduce leakages, and result in voluntary improvements in compliance levels. There needs to be a reorientation of subsidies towards the weaker sections of society and elimination of those subsidies that are inefficient. Finally, there needs to be a continued emphasis on infrastructure development and this government needs to build on some of the good work done by the previous government. I think the government recognizes all these needs.

What changes would you like to see in the Indian market that would promise more flows of foreign investment money into the equity markets?

AC: The move to eliminate long-term capital gains tax and reduce short-term tax to just 10 per cent in lieu of the 0.15 per cent turnover tax is a very welcome move for foreign portfolio investors. Further simplification of [the] foreign investor registration process will help attract more investors. Over the longer term, I think flows will follow the success of Indian companies and as long as corporates continue to make good progress...they will continue to attract greater flows.

Is India's economic development too reliant on foreign capital? How important is domestic investment?

MP: No, India's economic development has not been reliant on foreign capital. The one area where large capital has come in is in portfolio investment. Domestic investment is important as India has a savings rate of over 25 per cent of GDP. We get $4bn to $5bn of FDI and $12bn from foreign institutional investors. But the major dominant source of money is the domestic market, and it is growing. he Indian financial market, with banking, insurance, the stock market and the government bond market, is valued at $1.2tn, thus there is a lot of money in India. The key is the cost of capital and efficiency of its use. Companies can today go abroad to raise capital cheaper. Even though the domestic market is viable, if you want to raise $2bn to $3bn, the local market cannot sustain it.

AC: Domestic capital flow, particularly into equity, is a big concern. Equity holdings of the average household are less than a measly 4 per cent of assets. With real interest rates being close to zero, investors will continue to get pushed towards equity markets over time, however a lot more needs to be done to pull them towards the market. The government needs to proactively encourage the development of domestic institutional investors such as mutual funds and banks. That, combined with the capital tax breaks now available to all investors, will spur greater flows over the long term.

Social Engg: Cybercriminals are infiltrating companies

2004-11-22T06:30:00.000-08:00

The Financial Services Authority has warned that criminal gangs are increasingly placing people in companies to steal data and aid cybercrime attacks.
Criminals are attempting to plant insiders in companies to help them to commit financial and cyber crimes, experts warned on Friday. According to a report published by the Financial Services Authority, this activity is set to rise and businesses need to vet potential staff more carefully before employing them.

"Hackers and fraudsters are refining and improving their techniques as we speak," said Philip Robinson, financial crime sector leader at the FSA. "Firms will have to run to stand still if they are to protect their assets and those of their customers. The major banks tend to have strong defences in place, but there is no room for complacency and criminals will seek to exploit vulnerable points where they can find them, including in other sectors or smaller firms."

The FSA said that while larger enterprises had built defences to protect against hacking threats, small to medium-sized businesses were likely to suffer through lack of preparation.

The report, called Countering Financial Crime Risks in Information Security , found that firms had suffered few financial losses through cybercrime, but that they could be doing more to prevent attacks. It also recommended that managers take responsibility for securing data and examining current attack trends.

"Consumers must take steps to prevent attacks from fraudsters, by taking care when disclosing their personal details or following the security tips offered by their online banking service," said Robinson.

The FSA said that businesses aren't spending enough on security, which includes a failure to spend enough on modifying legacy systems to improve their security. It also criticised companies for failing to build relations with government bodies, which it said were working to reduce financial crime. The report reviewed 18 UK firms.

Sarbanes Oxley (SOX) Simplifed

2004-11-21T19:27:00.000-08:00

Sarbanes-Oxley is a US law passed in 2002 to strengthen Corporate governance and restore investor confidence. Act was sponsored by US Senator Paul Sarbanes and US Representative Michael Oxley.
Sarbanes-Oxley law passed in response to a number of major corporate and accounting scandals involving prominent companies in the United States. These scandals resulted in a loss of public trust in accounting and reporting practices.
Legislation is wide ranging and establishes new or enhanced standards for all US public company Boards, Management, and public accounting firms.
Sarbanes-Oxley law contains 11 titles, or sections, ranging from additional Corporate Board responsibilities to criminal penalties. Requires Security and Exchange Commission (SEC) to implement rulings on requirements to comply with the new law.

What does Sarbanes Oxley Address?

Establishes new standards for Corporate Boards and Audit Committees
Establishes new accountability standards and criminal penalties for Corporate Management
Establishes new independence standards for External Auditors
Establishes a Public Company Accounting Oversight Board (PCAOB) under the Security and Exchange Commission (SEC) to oversee public accounting firms and issue accounting standards

eBay on Process Improvement and User Orientation

2004-11-20T09:00:00.000-08:00

Fresh for the new year, eBay plans an overhaul of its "Item Not Received" process, which could have important ramifications for buyers and sellers on its service.

Scheduled for January, the e-commerce giant plans to implement a set of product and policy changes that it hopes will create a simple and straightforward process for starting buyer-seller discussions on disputed transactions (and ideally, resolving them.) But the plan also could reduce the number of superfluous complaints.

The company said on its announcements page that the enhancements are designed to "take the mystery out of what to do when the buyer has not received an item or has received an item that is significantly different from what was described in the listing."

eBay added that under the present system, merchants and buyers alike may not be certain of what to do when such a problem arises -- which can lead to lost goodwill and negative Feedback postings.

Accordingly, the company said its changes would help both parties understand what actions to take if a disputed transaction occurs.

Under the planned system, buyers will be able to begin a discussion with sellers from within their My eBay screens. eBay said the system would walk buyers through the process, providing tips and highlighting next steps to take.

The My eBay page also will feature a new Dispute Console, which will list ongoing problems, helping buyers and sellers track their status. This also will apply to Unpaid Item problems.eBay also said it would promote education for new buyers, to ensure they're familiar with the processes to resolve disputes.

The system also will enforce a seven days "waiting period" before a seller can initiate a dispute. Ideally, this can cut down on problems by ensuring that buyers have time to learn about standard delivery times and other processes related to eBay transactions.

On the other hand, eBay also is reducing the amount of time necessary for buyers to wait before filing an official claim through eBay's Standard Purchase Protection Program. Under the current system, a customer must wait 30 days before filing a complaint. The new system would cut that time to 17 days.

The changes also more closely integrate eBay's PayPal into the mix, for disputed transactions that use the alternative payment system. Now, PayPal unit will automatically begin assessing buyers' claims after they open a dispute -- determining whether the claim is eligible for coverage, based on criteria set in the PayPal Buyer Protection or the eBay Standard Purchase Protection Program.

The plan builds on earlier efforts to beef up the amount of and procedures surrounding buyer protection. In October, the company said online shoppers using PayPal in their eBay transactions would get up to $1,000 of buyer protection.

The move by PayPal, which is owned by eBay, doubled the coverage from $500 for qualified transactions on the e-commerce and online auction site. The expansion took effect earlier this month and covers approximately 80 percent of all eBay-listed items, the company said.

The protection is extended only when certain purchasing conditions are met -- such as when transactions result in non-delivery, or the delivery of items that are significantly not as described. The protection also extends only to transactions completed with an eBay-qualified seller -- defined as one who maintains a 98 percent positive feedback rating and has at least 50 feedback points.

Company reps said the company's buyer complaint process would still be available for transactions that do not qualify for PayPal Buyer Protection. eBay's standard purchase protection offers $200 of coverage with a $25 processing fee. Weeks earlier, eBay took additional steps to enhance its procedures by expanding its Feedback Withdrawal process. Under the changes, it put in place a third-party review process in eBay Motors.

In addition to those initiatives, PayPal in June debuted Buyer Credit, enabling shoppers to sign up for financing for higher-cost items they purchase on eBay and elsewhere on the Web.

PS: I hope some bankers in India are listening to above.

Evaluation Guide - BPM software and Vendor

2004-11-20T08:03:00.000-08:00

There are more than 100 BPM software vendors, all selling something different. Here's how to figure out whether you need it and how to make it work for you.

Depending on whom you ask, business process management (BPM) software helps monitor human and automated processes, automate previously human processes, process something still managed by humans or manage something previously processed by humans.

Gartner estimates that there are currently over 100 BPM vendors out there, and it seems that no two agree on what it is they're selling. So which definition is right? "They all are," says Eric Austvold, a research director at AMR research. "There are varying degrees of rightness." Behind the hype, BPM is a marketing buzzword for various software applications that are useful if you have a business process that needs improvement. But for a BPM product to be useful to you, rather than a waste of time and money, it's important to choose the right project and the appropriate software.

What BPM can do ?
You can buy a BPM application that monitors your business processes, automates workflow or serves as an enterprise application integration (EAI) tool. These products can help you identify areas of your business that need to be automated, enforce business rules and even help you integrate your existing IT infrastructure. CIOs who have successfully deployed BPM report that it has made their companies more efficient. For the most part the software is relatively inexpensive, often as low as $100,000, which means that most companies can afford some version of BPM if they want. Happy customers report a high ROI, often between 200 and 300 percent.
PS: American National Insurance Company has experienced a 71 percent reduction in caller abandonment since putting a business process management system in place.

User group who implemented BPM believes that, any process improvements initiatives are not linear in
nature and thus, getting process re-engineering autoamted is critical for them.

What Is BPM?
A decade ago, Michael Hammer pushed the idea that process reengineering was the next business revolution. He promised companies that if they overhauled their business processes the businesses would become more efficient. Most businesses that bought into the argument laid a lot of people off, but the expected efficiency eluded them. In part, this was because it was hard to get everybody who was left to agree to change their work processes. And in part because even if they did, companies had no mechanism to enforce the changes. But today, the concept is back in the guise of BPM software, which provides a way to monitor and/or enforce efficient business practices. BPM software does this by extracting data from a company's business applications and doing one of two things with it: tracking how the information is used to perform a task so that you can map an existing business process, or escorting the data through a set of tasks to ensure that a business process is being followed. There are three basic varieties of BPM software: monitoring tools, workflow software and tools that support EAI.
Efficiency monitors
BPM monitoring products are essentially computerized versions of the 1950s efficiency consultant who would stand next to the assembly line staring at a stopwatch through "Coke-bottle" glasses. A monitoring product uses built-in application programming interfaces to connect with each of the systems a company uses for a particular process (for instance, tracking an order from the time it's placed to when it ships), and then monitors the process for inefficiencies. A company may discover that there is a consistent 12-hour lag between the time a product is placed in the shipping queue and when it actually ships. Then it's up to the company to figure out a solution. (Maybe it hires an extra loading dock worker or invests in load-scheduling software.) Monitoring software can also be used to keep tabs on a process and send out alerts when the correct process isn't being followed.

Canadian mutual fund company AIC used BPM monitoring software from Sajus to speed up its process for updating clients' accounts whenever there is a transaction. AIC is Canada's largest privately held mutual fund company with approximately $12 billion in assets under management.
Traditionally, customer transactions would sit in a queue on the mainframe, waiting for a nightly update to AIC's shareholder management system. That meant AIC financial advisers were not able to see the most recent transactions when they logged on to AIC's Web-based customer portfolio management system.

CIO Joe Sferrazza thought the advisers should have this information, so he built a Web service that updates the client's account in real-time on the customer portfolio management system that the advisers use. The mainframe is still updated nightly, and the client's account information in the portfolio management system is rectified against the master database on the mainframe.

Sferrazza uses the Sajus software to make sure that all of this goes off without a hitch. The BPM software monitors the process and when it spots a problem it sends an alert to the appropriate person to fix it, rather than waiting for a person to detect the glitch the next time they look at the customer's portfolio. Without the built-in monitoring, Sferrazza would have no guarantee that the automated processes are being properly executed.

Workflow Software
Another variation on the BPM theme is the workflow-based products that companies such as Pegasystems, Metastorm and FileNet have developed. These systems automate some parts of a business process and direct some tasks in the business process to people, assuring that the process is followed. For example, a workflow BPM system won't let a sales rep open a new account before the system confirms that the client doesn't already have an existing one. The trick to using BPM software to automate and enforce a business process workflow is that the people who will use the system have to come up with a detailed map of the processes that they want the system to follow and enforce. Therefore, the new system is only going to be as good as the processes that it automates.American National Insurance Company (ANICO) used BPM workflow software from Pegasystems to improve service in its call centers. In the mid- to late-1990s, ANICO's call centers experienced high drop rates and high customer frustration levels in part because the information that agents needed was hard to access. For example, in the health insurance division, a customer's personal information, HMO information and policy administration details were stored in multiple legacy systems. "Our [agents] were navigating multiple systems while trying to keep someone on the phone," explains Gary Kirkham, the company's vice president and director of the planning and support division.
In 1998, Kirkham began working with Pegasystems to install a workflow system (later rebranded by the company as a BPM product) that would guide call center employees through these systems and give them a logical process to follow. The system automatically extracts information from each of the legacy systems and delivers it to agents through a common user interface.

Before Kirkham could automate anything, though, the call center employees had to come up with a completely new business process model. While Kirkham met extensively with the call center workers to explain the project (how it would change the way they served customers and why it was important to capture best practices), it wasn't his job to come up with and document these processes. That role fell to Zeb Miller, the company's assistant vice president for health administration. Kirkham jokes that it didn't hurt that Miller is 6 feet 7 inches and 250 pounds.

Now when a customer calls with a question about his or her health insurance, the BPM software prompts the service rep to confirm the caller's social security number and address before getting access to the insurance information. Since this BPM application can enforce workflow rules, the call center employees know what types of services they are allowed to provide based on who the caller is.

Call center workers are now able to solve customers' problems faster, which in turn allows them to serve more customers. Since putting the system in place, ANICO has experienced a 71 percent reduction in caller abandonment and a 61 percent improvement in the average time it takes to answer the phone. Furthermore, this type of project is easily repeatable. While Kirkham started small—just putting the system in the health-care call center—it is now being used to support other ANICO insurance products as well.

Enterprise Application Integration Tools
Large enterprise application vendors and system integrators have used the fact that BPM has application program interfaces (APIs) that extract information from a company's existing systems to push it as an enterprise application integration tool. In other words: If you are going to integrate your systems, why not take it a step further and use BPM as the user interface that connects to your middleware, regardless of what that middleware might be? IBM, Tibco and other integration vendors have bought existing BPM software companies and adapted their applications.

The BPM technology used with EAI isn't substantially different from the monitoring or workflow varieties. For example, Tibco acquired Staffware, a workflow vendor. And the way companies use BPM for integration isn't all that different either. In this case, BPM supports larger projects. Forrester Principal Analyst Ken Vollmer warns that combination EAI/BPM suites are capable of supporting larger projects and are generally more expensive than either standalone EAI or BPM products would be. "Using an EAI/BPM suite in a situation that could be handled by a standalone BPM product could add another $300,000 to the cost of the project," Vollmer says.
The Star Alliance, a partnership of 15 major airlines, including United and Lufthansa, is using BPM to help integrate its members' legacy systems. While the partnership is committed to unifying the processes that its members use, it is equally committed to doing so in a way that respects each company's previous investments.

That's no small challenge, says Brian Cook, Star Alliance director of IT and acting CIO, with dozens of legacy systems to integrate. For example, a new service for frequent fliers on member airlines required the IT team to consolidate 90 separate business processes across nine airlines and 27 legacy systems.

This kind of integration effort could quickly spiral out of control, says Cook, but the BPM software helped provide a blueprint for how to share data among the various systems. The Star Alliance IT and airline project teams used the BPM software to record how each airline checked in customers and processed their frequent flier information. Then, airline managers took that information and developed a new business process that they mapped in the BPM application. This map was used to identify the points of integration for each legacy system.

How to Tell if BPM Is Right for You
The vendors will tell you that everyone can benefit from BPM, and, like all hype, there's a grain of truth behind it. Almost everyone has a business process that needs improvement. The questions you need to ask yourself are: What's the problem you are trying to solve? What's the size of the investment you are willing to make? And how committed are your business units to making their processes more efficient?

Forrester's Vollmer says that an EAI/BPM suite is a way to get more from your existing systems, since this type of solution can enable the building of integrated applications without necessarily requiring you to make any other technology investments. This gives companies a tremendous amount of flexibility when determining what type of project to pursue and which BPM vendor to work with. But Vollmer also says that common sense plays a large role in making that choice. For example, if you are considering an enterprise application integration project, he says, it is also wise to consider whether you are a good candidate for BPM in the near future. Since most EAI vendors provide both, CIOs should make sure that combined EAI/BPM solutions are evaluated as well as standalone products in each category.
Business process management software can enable the building of integrated applications without necessarily requiring you to make any other technology investments.
On the other hand, most BPM users prefer to start small. One reason, warns ANICO's Kirkham, is because process change—particularly, the type of radical process change his company's call center employees experienced—is hard. Trying to change too much at once could be counterproductive. People need time to learn the new process and how to use the BPM software. Just as business process reengineering failed, BPM will fail if there isn't institutional support for change. Kirkham says that even when ANICO's employees got training, the company didn't really gain efficiency until they hired a large number of new workers who never knew the old process.

AIC's Sferrazza also says that his company isn't ready to undertake a project on a grand scale, although he does plan to use the Sajus monitoring tools for other self-contained business processes. "We can effectively monitor our systems," he says. And for now, AIC's focus is on squeezing the last bit of efficiency out of that monitoring. His other concern is that the company will come to rely too heavily on monitoring software, raising his IT costs. "I can see a day where I will become so dependent [on BPM] that I need several people just to make sure that the processes are being monitored," he says. In other words, if monitoring is the key to automation, then someone needs to monitor the monitoring software.

What to Know Before You Buy
AMR's Austvold says that the decision about which type of BPM software to buy comes down to knowing what your goals are. Everyone agrees that it is a buyer's market right now and that CIOs looking for a bargain on BPM software can find one. But CIOs and analysts all caution that no one should make a buying decision based on the deal they get. With the exception of large integration projects, the money involved in BPM isn't that great and it's not hard to get an ROI from the right project.
VALUE FROM BPM
Joe Sferrazza, CIO with AIC, monitors updates of client data. Brian Cook, acting CIO with the Star Alliance, creates a blueprint for integration. Gary Kirkham, VP with ANICO, guides call center employees.
Furthermore, as with other evolving technologies, the marketplace is bound to consolidate. Most companies that sell BPM products are small and those products address one type of BPM function. There is always a chance that your vendor could go out of business, leaving you to support a product yourself. Austvold says the products from small companies are often better, however.

"You have a couple of choices," says Richard Soley, CEO of the standards organization the Object Management Group. "Go with a large vendor who you don't think is going away or you go with a [smaller vendor that uses a] standard. Obviously [this sounds] self-serving, but I don't see what else you can do, besides ignore it" and hope your competitor doesn't gamble more successfully.

There are several standards for BPM, such as the emerging Business Process Execution Language (BPEL), and more mature Web standards, such as Web Services Description Language and Java Message Service. Soley says every vendor uses some type of standard, and you need to choose one that is compatible with your existing applications. Finding out if a vendor uses standards should be part of your due diligence process before you buy. Success with BPM
Success comes down to a few simple steps. First, make sure that you have a specific process in mind that you would like to improve with a BPM product. Next, monitor the process to learn how it works now. (You can use BPM monitoring software to do this.) Then, you and the process owner need to figure out how you want to change the process and redesign it accordingly. If it's appropriate, you can use a BPM workflow application to manage the new process.

Cook of the Star Alliance says that a successful BPM project leaves a company with a documented set of business rules that could prove to be its important intellectual property, as well as provide a road map for future development of IT projects. "It's hard to extract and document years of experience," he says. "You end up with tons of information. But it ends up making [future projects] much easier for IT."

Monitoring Software
Tracks data through a business process

Agentis
CommerceQuest
Sajus

Workflow
Guides employees through a business process

FileNet
Metastorm
Pegasystems
Savvion

Enterprise Application Integration
Provides a user inter-face to middleware applications

BEA
IBM
Microsoft
Oracle (Customer Data Hub)
PeopleSoft (AppConnect)
SAP (NetWeaver)
SeeBeyond
Tibco
webMethods

SOURCES: GARTNER, FORRESTER RESEARCH

Investment Scams: Pump and Dump

2004-11-20T02:56:00.000-08:00

Pumping and Dumping Defined
The phrase "pump and dump" (sometimes referred to as "hype and dump") in a financial context refers to a highly illegal practice where a small group of informed people buy a stock before they recommend it to thousands of investors. The result is a quick spike in stock price followed by an equally fast downfall. The perpetrators who bought the stock early sell-off when the price peaks at a huge profit. Most pump-and-dump schemes recommend companies that are mid cap and have a small float. Small companies are more volatile and it's easier to manipulate a stock when there's little or no information available about the company.
Pump and Dump's Cousin: Short and Distort
To this point we have only talked about scamsters making money by driving a stock's price up, however, there is also a variation of this scam called the "short and distort". Instead of spreading positive news, fraudsters use a smear campaign and attempt to drive the stock price down. The fraudster's profit is made by holding a short position in the stock, benefiting from a decline in its price.
Top 3 Ways to Avoid Getting Burnt by a Pump and Dump:
1) Always research the independence of an organization promoting a stock. Look for the small print about compensation in the form of both cash and shares.
2) If the stock trades over-the-counter or on the Pink Sheets be especially wary of a "hot tip". Smaller stocks are easier to manipulate than large caps.
3) Approach all free stock tips with the utmost skepticism. Just because something is written does not imply credibility. Understand that bulletin board postings and writers of investment newsletters can often have other motives for their recommendations.

Scams in Stock Market

2004-11-20T02:33:00.000-08:00

It is always seen that, moment Stock Market start showing numbers and scams starts mushrooming. Despite regulatory controls and better exchange level control including single day trade embargilono on few of the scripts, punters find their way out to escape. I was courious and searched for the anatomy of Scam and came across good piece.

What Exactly Is an Investment Scam?
an investment scam is based on one person trying to make a buck off of a less-informed, or naïve, individual. Scam artists take advantage of their prey by promising impossible outcomes, risk-free rewards as well as new and undiscovered investment opportunities. And some scams that have evolved are indeed hard to identify.

Probably the most important thing to remember as far as investment scams goes is that there is no holy grail to investing, no secret sauce so to speak. Anyone claiming that their system is fool-proof is simply trying to trick you into parting with your hard-won cash. The old adage "if it sounds too good to be true, it probably is" applies in this context very well.

some the most prominent schemes that investors have been subjected to and identify the best ways to avoid being victimized.

Some schemes have been around for decades, while others have popped up with the advent of new technologies, the Internet for example, others are hybrids combining an old scam with the new communications technology available to fraudsters. Let's take a look at some of them.

Pyramid Schemes:
It is a hierarchical scam that relies on new recruits providing money to those above them in the pyramid. The person, or in some cases the company, starts the scheme by recruiting people, with the offer of extremely high returns on their investment. As the scheme begins a small number of the earliest investors do receive a high rate of return, paid for by cash inflows from new recruits -- not a return on any real investment. However the pyramid's liabilities, from the day the scam is initiated, soon exceed its assets because it cannot generate wealth any other way than promising extraordinary returns to new recruits and paying these returns by getting new recruits.

It doesn't take long before this vicious circle collapses and the new recruits' base dries up. The scam relies on an infinite number of people joining the pyramid to repay the latest set of recruits. Quite clearly this cannot happen and those at the bottom of the pyramid get burned, while a select few at the top who started the scam essentially pocket, or steal, loads of money from the new recruits.

Pyramiding at its Worst: The Albania Example
One of the most notable examples of a pyramid scheme sprung up in 1996 in Albania, where the nominal value of the pyramid scam's liabilities equaled half of the country's GDP (gross domestic product), while two-thirds of the population invested in the companies orchestrating the scam.

This was a transitory time when the country was in the midst of moving from a communist, or controlled, economy to a capitalist one, with their banking sectors and financial markets short on regulations and long on inefficiencies. With little or no experience in an open-market economy, Albanians began to entrust their money to deposit-taking companies that had begun to spring up. In turn, these companies took the depositor's funds and "invested" them.

Top 3 Ways to Avoid Getting Burnt by a Pyramid Scam:

1) Be very wary of any plan that pays you to recruit new sales people with little focus on selling an actual product.
2) Beware of an opportunity that requires you to invest a large sum up front that does nothing more than require you to recruit others.
3) Any plan that promises you greater profits once you recruit or convert more people should be suspect.

GE acquires DeltaBank in Russia

2004-11-19T04:54:00.000-08:00

There is good move happening from GE in last few months on Merger and Acquistion front. GE selling off captive BPO is good sign. One more arrow from GE cever in Russia Acquitions is strengthing GE's strategy.

GE Consumer Finance, the global consumer lending unit of General Electric Company, has completed its acquisition of DeltaBank, a Moscow-based Russian consumer bank.

According to Datamonitor, GE Consumer Finance agreed to purchase DeltaBank from its majority shareholders, Delta Russia Fund and The US-Russia Investment Fund, both managed by Delta Private Equity Partners. The purchase was subject to regulatory approvals, which have now been received.

Founded in 2000, DeltaBank provides a variety of consumer finance products through branches and more than 70 imbedded points of sale in established retail outlets, such as Ikea and other major retailers.

DeltaBank is a leading issuer of Visa cards in the Russian market, with over 150,000 credit cards issued. In addition to bank cards, it also provides personal loans and sales finance.

Why Core Banking is Important for next 5 years

2004-11-18T10:12:00.000-08:00

Came Across recent survey of UK's Customer Behaviour research analysis. It is interesting to understand that, customer still believes in BRICK and MORTAR structure of the bank ( Less the IT Professionals who are the guys mostly using Net Banking). Read the following survey findings and analysis from UK Market.

The UK's bank branches are the most crowded in Europe, serving on average over 5000 people per site – more than five times the average in Spain – according to the latest research from Datamonitor.

Despite a notable increase in online banking – with 50 million consumers banking online in Western Europe and 11.5 million in the UK alone – electronic channels have not ousted the branch and are unlikely to do so in the foreseeable future, the report said.

Branches still take the lead in business generation and many customers with online bank accounts use the internet in addition to their branch. Despite this, Datamonitor predicts that branch numbers in the UK will continue to fall, but at a lower rate – from 13,917 in 2003 to 13,502 in 2008.

The research house said banks are refocusing attention on the branch, reinventing them as advice centers for affluent customers or financial shops for mass-market customers. Simple customer transactions and inquiries, such as cash withdrawal or balance statement enquiries are being moved to self-service terminals in order to free staff to handle product sales.

Basel Ous, financial services analyst at Datamonitor, said: ‘To increase the quality of advice in branches it will be key to seamlessly integrate branches within multi-channel delivery architectures, giving advisors access to all customer and product information across all channels. In doing so, they will enable branch advisors to provide the optimal, personalized service.’

Analysis of KMART and SEARS Merger

2004-11-18T08:48:00.001-08:00

ears-Kmart Merger: Is It a Tough Sell?

According to the CEOs of Sears, Roebuck and Kmart Holding, their plan to merge into a giant $55 billion retail company will produce stronger brands, greater efficiencies in operations and higher returns than either company could achieve standing alone.

Not everyone sees the wisdom of the deal, however. "Here you have two retailers who are doing badly right now and who don't really see a clear way to pull themselves out of the downward spiral," says Wharton marketing professor Stephen J. Hoch, who heads the school's Jay H. Baker Retailing Initiative. "It's hard to fathom how combining them is suddenly going to produce a new entity that will do better. That's tough to do, especially because the competition, including Wal-Mart and Target, isn't exactly standing still."

For complete listing please visit Wharton's Knowledge Portal.

Analysis of KMART and SEARS Merger

2004-11-18T08:48:00.000-08:00

ears-Kmart Merger: Is It a Tough Sell?

For complete listing please visit Wharton's Knowledge Portal.

Key Bank Channel Strategy

2004-11-18T08:14:00.000-08:00

Patrick Swanick, president of Key's retail bank and president and CEO of Key Electronic Services, has an all-business attitude about channel strategy: "This is a process for us, it's not a destination. We're looking at managing these channels as a business. We are also looking at our channels as strategic assets. When you make that shift in your thinking, from looking at distribution as a cost of doing business to distribution as a strategic asset of your company, you start to look at things in a different way. You start to listen to the customer more often."

Key's primary strategy is to deliver the bank's products and services in a seamless manner. The strategy is built around putting the client first, providing a distinctive level of customer service and working together as a team. Using customer comments as the basis for the changes, Key has reduced the number of branches, increased the number of ATMs and strengthened the call center and internet channels. Nearly one-third of customers now deal with the bank through the internet.

The first step in revamping Key's channel strategy was to centralize distribution management. Previously, channel management was fragmented, so competition for capital and resources went to different areas of the company. There was no cross-channel evaluation.

Several challenges included

underestimating the data challenge (plenty of data, but not much actionable information),
underestimating the role of product design (high-net-worth clients need higher-touch contacts than do mass-market customers),
making it easy for customers and employees to do business at the point of sale and service, and
showing respect to customers and doing business with them the way they want to do business, not the way we want them to do business.

Financial services companies need to create unique experiences for their customers. If you are able to provide a consistent customer experience that's true to your brand across your channels, you're shifting the basis of competition from product and price to total value. In tough times, your ability to create that loyalty really matters.

Manage distribution as a business. You have to understand the economics of the business beyond product profitability … it's more about what's happening in the actual vs. the planned for each channel by defining what the channel experience is for each segment.

Remember that customer retention starts with employee retention. Employees and their bosses need to understand their jobs.

Seller's Labour Pain - Shopping Cart Abondand

2004-11-16T02:47:00.000-08:00

The third quarter 2004 "E-Commerce Site Trend Report" from DoubleClick reports that online shoppers look at 33.8 percent more pages (10.3 pages in 2004, vs.7.7 in 2003) this year than last.

That's the good news. The not-so-good news that is that while they may be looking at more, they're spending a bit less time on e-commerce sites (0.5 minutes, a 10 percent decline), averaging only 4.4 minutes per session. This decline represents a 14=second (32.6 percent) decline in time spent per individual page, from 43 seconds last year to 29 seconds in 2004. One potential reason for the drop, according to the report, is the increase in broadband users, which has risen to over half the U.S. online population.

Shopping Cart abandonment continues to be a problem for online retailers, but it appears to be leveling off. In Q3 2004, 57 percent of shoppers abandoned carts without purchasing, a 7 percent increase over the same period last year. From a lost revenue perspective, cart abandonment grew 7.9 percent this calendar year. This translates into $4.10 left in abandoned carts for every dollar actually spent on an e-commerce transaction. That figure is on the way down from a Q4 2003 high of $6.30. Users who returned to abandoned carts represented 26 percent of all sales, which DoubleClick notes is a decline from Q2 2003, when it was 36 percent.

For more details, please visit E-commerce Guide 's Latest posting by Sean Michel Kerner

Lifestyle in 22nd Century

2004-11-15T01:01:00.000-08:00

Our  communication                        Wireless

Our business                        Cashless

Our telephone                        Cordless

Our cooking                        Fireless

Our youth                        Jobless

Our religion                        Creedless

Our food                        Fatless

Our faith                        Godless

Our labour                        Effortless

Our conduct                        Worthless

Our relation                        Loveless

Our attitude                        Careless

Our feelings                        Heartless

Our politics                        Shameless

Our education                        Valueless

Our Follies                        Countless

Our arguments                        Baseless

Our commitment                        Aimless

Our poor                        Voiceless

Our life                        Meaningless

Finally, Our existence              Useless???

TRM reports net income of $2.2M in '04's 3Q

2004-11-14T23:52:00.000-08:00

PORTLAND, Ore. — TRM Corporation reported that net income increased to $2.2 million, in 2004's third quarter, as compared to $1.5 million for the same period in 2003. For the nine-month period ended Sept. 30, net income more than doubled to $7.4 million, compared to $3.4 million for the same period in 2003.

During the latest quarter, TRM said ATM gross sales increased by 51.1 percent to exceed $17 million, surpassing photocopier gross sales of $11.9 million. ATM operations produced net sales of $12.6 million during the latest quarter, an increase of $3.3 million as compared to the same period in 2003; for the first nine months of 2004, ATM net sales increased by $8.2 million to $33.7 million, as compared to the same period in 2003.

Transacting ATMs grew to 4,868 in 2004's third quarter, an increase of 1,516 units over the prior year, representing both internal growth and acquisitions. Four ATM network acquisitions totaling $10.9 million were completed during the first nine months of 2004 and funded through internally generated cash flow.

Total ATM withdrawals increased from 4.1 million to 5.7 million. Average monthly sales per unit increased from $1,047 to $1,139, and average sales per withdrawal increased from $2.54 to $2.83. ATM operating income increased 28.9 percent to $2.5 million in the latest quarter; and year-to-date ATM operating income increased 101.7 percent to $6.5 million.

Photocopier operations produced net sales of $9.9 million during 2004's third quarter, down $600,000 as compared to the same period in 2003; for the nine-month period ended Sept. 30, photocopier net sales remained flat at $32.4 million. Also during the quarter, a follow-on public offering of common stock generated proceeds in excess of $50 million.

On Sept. 20, TRM entered into a $150 million definitive agreement with eFunds Corporation to acquire more than 17,000 ATM contracts. Following the acquisition, scheduled to close prior to year end, TRM will become the single largest international ATM deployer with more than 22,000 locations in the U.S., Canada and Europe.

GE Consumer Finance eyes Malaysia, Philippines

2004-11-13T07:37:00.000-08:00

Ridha Wirakusumah, president of GE Consumer Finance Asia, elaborates that the company’s strategy to grow in the region will increasingly hinge on acquisitions.

In the past four years, GE Consumer Finance (GECF), the global consumer-lending unit of US-based General Electric, has quadrupled the size of its business in Asia in terms of assets and revenue mainly through alliances and expansion of its own network. Ridha Wirakusumah, GECF Asia president, says that with Asia growing rapidly the company has decided to take a different growth strategy.
“Acquisition, I think, is going to become a little bit more prevalent in the way we grow, but even without acquisition we are growing rapidly,” he says. “We are looking at opportunities across all our existing markets in Asia, but Philippines and Malaysia are pretty much on our radar screen.”

Ridha explains that Asia is GECF’s fastest growing region and has been identified as a key contributor to the company’s future growth and development. GECF, which accounts for about a third of GE’s total assets, reported total profit of $2.16 billion and assets of $106 billion for last year.

In Malaysia, GECF has reportedly received approval from Bank Negara, Malaysia’s central bank, to negotiate with a local partner for the establishment of a joint venture in consumer finance. Ridha thinks GECF’s Asian business three years from now can be at least two to three times the size it is today. “I’d like to be in all markets (in Asia). I’d like to be in all consumer (finance) products,” he declares.

Ridha says his approach involves a simple consideration: “How can I come into and be able to compete in a market where the customers will come to us because they want to, because our product offering is better than everybody else’s? It’s much easier said than done but that’s what we’re striving for.”

Last August, GECF entered into a strategic joint venture agreement with Hyundai Capital Services (HCS), Korea’s leading consumer finance company. Under the agreement, GECF will acquire 38 percent of the outstanding common stock of HCS, valued at approximately $375 million with an option to purchase an additional five percent at a later date. In addition, GECF will also purchase subordinated debt of $330 million and make an additional capital contribution of up to $116 million.

In Australia, GE Money, which holds the group’s consumer finance operations, reportedly grew its business from $4 billion in assets four years ago to $38 billion in assets or almost as big as the country’s largest banks, primarily through acquisitions. It also appears interested in acquiring one of the profitable mid-tier banks such as St. George, Bank of Queensland or Bendigo Bank.

2004-11-13T06:23:00.000-08:00

Ehibit 1 - McKinzey Report

McKinsey Report - Steering customers to the right channels

2004-11-13T05:57:00.000-08:00

Migrating customers to a new channel can be a pain—for them, the company, and its channel partners. But the rewards can make the effort worthwhile.

Joseph B. Myers, Andrew D. Pickersgill, and Evan S. Van Metre

A single channel used to be all that companies needed to deliver products or services to their customers. But now companies, responding to customer demand for ever more channel choice, reach out through many routes. Multichannel customers spend 20 to 30 percent more money, on average, than single-channel ones do, and channels such as the Internet and overseas call centers promise big cost savings.

Yet multichannel marketing is harder than it might appear. Too often, companies multiply their channels only to face a host of unintended consequences that actually raise costs or cut revenues. In retail banking, for example, less expensive channels such as ATMs and the Internet have helped reduce average transaction costs over the past 15 years by nearly 15 percent. During the same period, however, transaction volumes more than doubled, since customers check their balances and make withdrawals more often than they did in the days when they had to wait in line at a branch. The result has been an increase in the overall cost of serving each customer. Similarly, serving customers over the Internet has saved airlines roughly $10 to $15 per booking. Nonetheless, Web-based channels facilitate the price transparency that, at some airlines, makes the average online fare an estimated $50 to $100 lower than that of a ticket purchased through other channels. Meanwhile, companies in some industries have seen their competitors mimic their expensive new channel approaches very quickly.

These are not isolated examples. As a result of proliferating channels, sales and marketing executives in a wide range of industries have lost control of their customers, with damaging financial consequences. The problems won't be easy to solve. Companies can't go "back to the future" by reducing the number of channels, because customers have grown accustomed to—and indeed are increasingly demanding—a broad range of options and might well defect if companies discontinued them. What's more, common tools for improving the efficiency of channels, such as changing distributors, tweaking incentives, and upgrading the sales force, often fail to close the gaps between the desires of customers and the realities of channel economics.

To gain control of multichannel interactions, companies must begin to constrain the channel options of customers by guiding them subtly

To gain control of multichannel interactions, companies must begin to constrain the channels customers use by subtly guiding them through the sales and service process, from awareness of the product through purchase and postsales support. This "rerouting" allows companies to shape when and where they interact with the people who buy their products and services. By encouraging the use of different channels at distinct stages of the sales process, leading companies balance the preferences of their customers with the economics of their channels. The rewards can be substantial. They include reducing the cost to serve customers by as much as 10 to 15 percent, increasing revenue per customer (through higher retention rates or an enhanced mix of products and services) by as much as 15 to 20 percent, and gaining the chance to penetrate previously underserved segments. Moreover, carefully tailored "routes to market" can become powerful sources of sustainable differentiation because they are difficult to imitate and often become linked in the customer's mind with actual product or service offerings.

Trailblazing companies in industries from mobile telephony to high-tech manufacturing to transportation equipment are beginning to enjoy the benefits of migrating their customers to new channels in this way. Many more, though, seem afraid to start—understandably, since channel migration is risky business. A company can easily make poor strategic decisions about whether or where to migrate its customers, and a botched transition can derail even the best strategy. To mitigate these risks, the company must understand its channel economics, use incentives to guide its customers to the right channels at the right times, provide a safety net to control any backlash by customers and channel partners, and develop a communication program that inspires its internal and external constituencies. Armed with such tools, it should at long last be ready to fulfill the promise of multichannel marketing.

Setting strategy:

Customers may always be right, but allowing them to follow their own preferences often increases a company's costs while leaving untapped opportunities to boost revenues. Instead, customers must be guided to the right mix of channels for each product or service. How can a company determine this optimal mix? When should it dispatch salespeople to close deals face-to-face or use outbound telesales channels to generate leads? In what circumstances does it make sense to reach out to customers through the Internet? Which service inquiries from high-value customers merit the attention of sales representatives rather than a lower-cost interactive voice-response system? Companies can find answers to these thorny questions by rethinking the economics and customer channel preferences that together shape their channel architecture and by examining the incentives they employ to influence the behavior of both customers and sales personnel.

The art and science of channel architecture:

Most companies have some understanding of the volumes and margins of their channels. Few, however, truly know the cost of serving customers in each of them or a channel's associated customer "quality"—that is, the value to the company of the products or services purchased through a particular channel. Even fewer grasp the economics of specific sales and service activities, such as the cost incurred to generate a lead, or which channels customers prefer. It is little wonder, then, that many corporations are unable to readily establish a channel architecture that retains customers (Exhibit 1), much less one that routes them effectively.

Economics:
Developing a true picture of channel economics starts with understanding the cost of serving similar customers (or of providing similar products) across channels. It's vital to consider often-overlooked cost categories such as freight and returns; seemingly attractive channels may turn out to be less than desirable or vice versa (Exhibit 2).Building such an understanding can also reveal opportunities to reduce costs in some channels.

Once a company makes its "apples-to-apples" comparison of the cost of serving similar customers across various channels, it should take into account differences in the quality of the customers drawn to them. The experience of the US wireless industry shows why such differences matter. Wireless operators once focused on a simple metric to compare the effectiveness of their channels: the cost per gross add (CPGA), which represents the typical expense of acquiring a new customer. Many channels with similar CPGAs had wildly different customer profiles, however. Only after wireless operators examined their margin per customer and the churn associated with different channels did they realize that some channels, such as company-owned retail stores, helped them acquire and retain a disproportionate share of their highly attractive customers. Not surprisingly, the carriers—which as the industry matures are looking more and more closely at such distinctions—have opened more retail stores.

An accurate view of aggregate channel profits isn't enough, though. Since customers jump between channels as they move through the purchase process, companies can guide them effectively only by understanding the economics of each channel at every stage of sales and service. It is necessary, for example, to know how much time telesales people spend generating leads as opposed to providing customer service, to say nothing of the return on that time. To learn all this, companies must have transaction-level cost and revenue figures or, if data are hard to find, estimates.³

Preferences. If economics is the science of channel architecture, customer preferences are the art. Customers, of course, frequently prefer some channels to others for certain transactions, and specific channel combinations often engender loyalty or create cross-selling opportunities. Research on customers and statistical analysis (such as the kind that marketers use to build brands) can help identify the preferred channel combinations.⁴

Marrying insights into channel economics and customer preferences can be very worthwhile. A major industrial distributor, for example, compared the real costs and benefits of serving customers that placed large orders infrequently, on the one hand, and those placing smaller orders more often, on the other. It became clear that the company's channel strategy placed too much emphasis on the latter. Knowing the preferences of different segments, in turn, enabled the distributor to determine which of them could be served by face-to-face salespeople or by telesales personnel and other remote channels. When it acted on these insights, it raised its margins by 15 percent. Similarly, a high-tech company is on course to cut its service costs by 20 percent and to raise its sales by 10 percent because a clear understanding of channel preferences, revenues, and costs is helping it realign its channel resources toward the most valuable customer segments.

Both examples highlight an alignment between channel economics and what customers want. Large customers, for example, may place a high value on face-to-face contact when they decide which products to buy but may have less need for it during postsales service. The obvious choice: focus the face-to-face sales force on presales activities and move postsales interactions to a lower-cost channel, such as an inside team that offers customers telephone support. What if they want more personalized sales and service than the company can provide economically? In these all-too-common situations, the key is to provide incentives that quickly guide customers to the right place.

Incentives

Incentives frequently combine a "carrot" and a "stick." The carrot is something (typically, discounts or improved service) that customers value highly and receive only when they use the preferred channel. The stick might be fees or reduced service, both of which work best when they are reasonably opaque and switching costs are embedded in the product or service. Many airlines introducing self-service check-in, for example, installed large numbers of kiosks to offer customers the carrot of extremely short wait times for automated service. But they also employed a stick: longer wait times for service at counters (as a result of reducing personnel levels there).

Charles Schwab has taken its use of the carrot-and-stick approach to the next level by guiding different customer segments to different channels. Schwab's investors open roughly 70 percent of all new accounts in branches. The company encourages affluent customers and those who want advice (and are often amenable to cross-selling) to go on using the branches by making it easy for these people to schedule appointments there.

But for most customers who look after their own investments, the value to the company of subsequent branch interactions is low and the cost of providing them high. Schwab takes several steps to increase the likelihood that such investors will execute transactions via the Web or a call center. For starters, when customers open their accounts in a branch, they learn how to trade on the Schwab Web site. This training continues when they phone a call center for brokerage transactions: if they are willing, sales reps walk them through the transactions on the Web. Finally, while branches continue to be an engine for acquiring customers, efforts are made to avoid reintroducing the installed base into this higher-cost service channel: investor education seminars, for example, often convene at third-party locations. By guiding customers through the sales and service process, Schwab has succeeded in offering them the benefits of a multichannel model while containing the cost of providing it.

Few sales reps object to a channel change that frees them to focus on their highest-potential customers—if their compensation doesn't dip

Customers are not alone in requiring incentives. A company's sales force must receive them as well. Few salespeople object to a channel change that frees them to focus on their highest-potential customers and leaves service and the generation of leads to lower-cost alternatives—as long as their compensation doesn't dip.

Finally, the thoughtful use of incentives can help companies manage the response of their channel partners. Even when the threat, perceived or real, of channel conflict is acute, "win-win" arrangements can eliminate many problems. A leading home-equipment manufacturer, for example, began selling products to big-box home-improvement centers despite the potential for conflict with its core channel, a dealer network. Before entering the home center channel, the manufacturer made sure that its dealers had strong financial incentives to continue pushing its products. First, it gave dealers a revenue stake in the new approach by ensuring that they handled postsales inspection and service on items purchased in home centers. Second, it gave dealers exclusive rights to certain product lines. In the end, the dealers significantly increased their revenues from its products and services, since they captured incremental service revenues from a new customer segment and overall awareness of the brand increased. Meanwhile, the manufacturer made double-digit gains in market share.

Of course, "win-win" incentives don't always exist. In these cases, companies should estimate the true magnitude of the backlash risk by taking a hard look at the realistic alternatives available to each partner. Sometimes they will conclude that they must refrain from tinkering with channels, but often they will decide that the risk is worth taking—particularly when a good transition plan is available to mitigate it.

Managing the transition

No matter how good a company's channel migration strategy may be, it can founder if customers think that service is deteriorating or if problems with channel partners and employees emerge. The secret to managing the transition is getting the timing right, providing safety nets that help everyone involved deal with the change, and developing a communication approach that builds momentum for it.

Getting the timing right

It is easier to open up new channels if supplies are tight, demand is strong, or competitors are in decline, because these conditions reduce the likelihood that customers or channel partners will defect. When a particular class of chemicals was in short supply, for example, one leading manufacturer migrated its transactionally oriented customers, representing more than 20 percent of its accounts and 10 percent of its volume, to telesales. That freed up face-to-face salespeople to focus on new prospects that were promising but time-consuming to develop, as product demonstrations were required. To make the migration easier, the company placed experienced salespeople in the telesales role—a tactic that helped customers to accept the lack of face-to-face contact and to preserve preexisting relationships—even when supplies were no longer short.

Providing safety nets

Once the migration starts, its participants need different forms of support, such as specialized training, pilots to introduce the new approach, and realigned commission structures.

Customers, for example, often require access to the touchpoints of both the old and the new channels, as well as hands-on training in the new one. W. W. Grainger, a large US supplier of maintenance, repair, and operations (MRO) parts, provided for these needs when it migrated customers from its personal sales staff to the Internet (to cut its costs) without making them less satisfied with its service. The company's 1,200-strong face-to-face sales force visited customers to show them how to order parts using the new Web-based system. Grainger made sure that its salespeople would invest enough energy in these training activities by adjusting its compensation system to give them credit for all sales in their territories, regardless of channel.⁵ Today the sales reps spend much of their time on higher-value activities, such as finding new prospects and building customer loyalty, while the company has raised its e-commerce sales from less than $100 million in 1999 to nearly $500 million in 2003. Grainger has not only become the largest supplier of MRO parts through the Internet but also profoundly differentiated itself from its competitors, many of which now find themselves burdened with outmoded sales forces and underused Web sites.

Channel partners also need support. Many of them are wary, even when the migration of customers to different channels seems likely to create new after-sales service opportunities or to enhance the brand in ways that would benefit them. Companies can give dealers some comfort by guaranteeing that they will continue to receive sales support or by arranging for special commissions during the transition. We have seen companies give channel partners—for six months or more—up to half of the commissions they would have earned on sales that moved to a new channel.

Finally, companies that migrate their customers must have the safety net of a carefully sequenced rollout that can debug problems before they get big. An office supplies distributor, for instance, moved its small accounts to telesales in four phases. To improve the odds for success, the company began with a single division, whose strong leadership was committed to improving its performance substantially. Next the rollout moved to four midsize divisions—one a weak performer, two mediocre, and one fairly strong—in four different markets. Only after learning a diverse set of specific lessons from each of these divisions was the company ready for a more extensive rollout that put the results of four of its largest business units on the line. When the shift to telesales succeeded there, the same approach was applied to the remaining 70 or so divisions. A two- to four-week break followed each phase of the rollout. During this time, pilot teams reassembled to share their experiences and, along with managers from the groups in the next phase of the rollout, to plan future improvements.

Creating a buzz

Customers and employees migrate to new channels more quickly when a company creates a compelling story line around their advantages

Customers and employees are quicker to migrate to new channels when a company creates a compelling story around the advantages of the new approach and identifies advocates who will champion it and perhaps even make it more widely known through the mass media. Delta Air Lines, for example, has been especially effective in selling its airport-lobby self-service model to customers. Delta began building interest through advertisements in national newspapers and on television and radio. Then each of the major cities where Delta revamped its airport lobby got a media blitz of customer testimonials through articles in local newspapers and interviews on television news shows. The testimonials eventually began to spread organically to the kiosks themselves as frequent travelers helped less-experienced ones use them. (Delta personnel initially played this role, but customers assumed it when they realized that by doing so they speeded up check-in for everyone.) During 2003 the buzz Delta created helped raise the number of self-service check-ins by several million, made the airline more productive, and cut its costs by tens of millions of dollars.

Internal communication is vital as well. Often, the migration of customers to new channels forces companies to redeploy personnel, redefine roles, and realign incentives. Since each of these moves can be uncomfortable for employees, it's important to develop and repeat a consistent story that emphasizes the benefits of the new approach. A travel services company, for example, began communicating very early to its telesales people the strategic importance of a new initiative that required them to develop cold-calling skills. Instead of providing service to customers who phoned in of their own accord, the agents would replace face-to-face personnel in identifying attractive corporate leads. Early communication created excitement about the shift and the training it required, and the efforts of the telesales reps helped the company to grow more rapidly.

Although customers want access to many channels, companies need not provide it solely on the customers' terms. With the right strategy and transition plan, companies can migrate their customers to different channels while still keeping the customers happy.