Power Partners

Wells Fargo is sprinting into each of these new areas, as well as many others. As of July, it had 178 Web-related projects under way, plus another 111 that it plans to begin in the future. That furious pace of activity is beyond the in-house capacity of even the 1,200-person squad that Ostler now directs. So he tells his team of bankers, "Move beyond the thinking that we need to own each line of code that we use. There are a lot of dotcoms that have created all sorts of things. Figure out what you need, and then snap in that Lego piece."

To see what happens when the stagecoach meets the Web, it helps to look at three of the bank's projects in detail. One involves an ambitious attempt to reshape much of corporate banking. Another involves the pairing of Wells Fargo with one of the funkiest Net companies around: eBay. The third is a foray into wireless banking -- an area so new that no one really knows just what will ultimately succeed.

In each case, bankers are discovering how to function in Internet time. They are making decisions faster, letting go of old-fashioned hierarchies, and improvising as they go along. Meanwhile, people from the dotcom world are learning the value of having a famous partner -- and the importance of stepping carefully when it comes to anything that might affect customers' willingness to let someone else handle their money.

Bankers in Blue Jeans

For years, Steve Ellis had been known within Wells Fargo as a talented maverick. He was a senior vice president who wore a small diamond earring and who abandoned suits for casual clothes years before the rest of his colleagues did. His résumé included not just an MBA from the University of Oregon but also a 21-year side job as the owner of a tavern in Portland, Oregon.

In the spring of 1999, Ellis decided to bet his career on an idea. He had been at Wells for 12 years, specializing in corporate banking, and he had successfully helped manage areas ranging from problem real-estate loans to cash-management and treasury operations. He could see that the Internet was starting to reshape the world of finance. In April, at a bankers conference in Atlanta, Ellis heard Scott McNealy, chairman and CEO of Sun Microsystems, give an electrifying presentation about the online economy.

"I got Internet religion,'' Ellis recalls. "I came home and pulled five people off their jobs. Then we brought in an Internet consulting firm and drafted a high-level strategic plan about how Wells Fargo should organize around the Internet channel."

Before long, Ellis began circulating his brash and almost-taunting views in a white paper. He contended that Wells Fargo needed to create a powerful Internet team for wholesale banking that cut across business lines. It needed to rethink the basic ways that it worked with customers. And it needed to move fast. As his crusade gathered momentum, Ellis was asked to present his ideas to Wells Fargo commercial- and corporate-banking executives at a company off-site. It was a make-or-break moment for him, and, just before he went onstage, he learned that a surprise guest was in the audience: Richard Kovacevich, president and CEO of the entire bank.

The blunt talk paid off. Wells Fargo's top brass decided that Ellis was onto something big -- and that he was the man to make it happen.

Wasting no time in his new job, Ellis decided that Wells Fargo needed to create an electronic-procurement service as fast as possible. The service would let corporate customers run purchasing departments online. Wells Fargo would collect small commissions on the transactions -- but, more important, the bank would establish the Wells Fargo site as a vital part of its customers' workday.

There was just one problem. Because of anxiety about possible Y2K-related computer snags, regulators had told banks that they couldn't do massive software upgrades after September 15, 1999. That was less than two months away. The solution, Ellis decided, was to find the fastest, smartest Silicon Valley startup that knew how to do e-procurement. That led him to RightWorks, a San Jose-based company founded in 1996 by Vani Kola, 36, an engineer from India. Ellis and his colleagues told Kola that if her team could deliver the entire e-procurement framework before the Y2K cutoff date, they would give RightWorks the Wells Fargo contract.

"They gave us just six weeks," Kola recalls. "But Wells Fargo was sharp. Instead of making us deliver everything before they would touch it, we became part of the company team. We had five people working on-site. We were in almost 24-hour email contact. And we got the job done about two hours before the drop-dead date."