January/February 1998
Volume LXXIV Number I
Published by BAI
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The Power of Saying No
by Steve Klinkerman — Banks often view acquisitions and product diversification as the best avenues to growth. But Harvard's Michael Porter says deciding what you shouldn't do is the beginning of strategic wisdom.

Electronic Commerce and the Threat of Brand X
by Bill Burnham — Online players are spending fortunes on branding campaigns, hoping to cement customer loyalty. But Piper Jaffray analyst Bill Burnham warns of looming price competition, citing the ability of software agents to seek out the best Internet deals.

Bank investors soon will shift attention from a sole focus on growth to a host of performance concerns, says NatWest Markets analyst Thomas D. McCandless. Bank managers will have a harder time meeting expectations.

No Guarantees in Database Marketing
Banks are leaping into database marketing, hoping to emulate deft credit card companies. Results are mixed so far, suggesting good customer information doesn't always boost bottom line results.

Wither Debit Cards?
Debit card usage is skyrocketing, both in the online and offline categories. Experts differ on which payment mechanism will ultimately win out, but agree that offline processing is more advantageous to banks.

Letter from the Editor
Banks often use acquisitions and efficiency crusades as a substitute for strategy. But thriving in a crowded financial services marketplace requires standing out from the crowd with distinctive products and services.

Law & Regulation
Congress four years ago established a commission to consider bankruptcy code reforms. Unfortunately, says Lawrence Chimerine of the Economic Strategy Institute, the commission's proposed recommendations would harm the economy by making bankruptcy easier.

Technology & Information
Many banks are outsourcing their Year 2000 software problem so they can stay focused on day-to-day operations. But consultant Lance B. Eliot cautions managers to scrutinize contract details and monitor vendors closely.

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