Banker's Hours

It was, Janey Place recalls, a moment of reckoning. Place, 55, heads up e-commerce strategy for Mellon Financial Corp., the Pittsburgh-based parent of subsidiaries such as Dreyfus Corp. and Newton Investment Management Ltd. Four months after she joined Mellon in May 1999, she walked onto a stage before 150 executives and unveiled the company's hotly anticipated e-commerce strategy. It was greeted with near-total silence.

"One man actually stood up and said, 'That doesn't sound very aggressive,' " Place recalls. "These are bankers. You don't often get a comment like that."

When Place signed on with Mellon, the financial-services powerhouse essentially had no e-commerce strategy. Mellon was way behind big banks and brokerage firms like Bank One and Citigroup, both of which had already launched their own separate online-banking ventures. Many Mellon executives were desperate to launch a Web channel at least. And they expected Place to lead the charge into cyberspace. Instead, she threw cold water on all that Internet euphoria.

Place had already led many major-league online initiatives. Within the banking industry, she was widely regarded as an e-commerce and business-technology futurist with extensive experience in developing technology-enabled business strategies at Bank of America and Wells Fargo Bank in California. And while she was determined to make Mellon a player in the digital economy, she would do so without forsaking the historical strengths that Internet pundits had rushed to write off -- things like bank-office infrastructures, branch networks, and customer-service staffs.

Place firmly believed that, while the Internet changes everything, it would never abolish customers' desires for trusted (read: human) sources of financial advice and expertise. So her plan for Mellon's e-commerce strategy was decidedly simple and sober: Instead of spinning off a separate, headline-grabbing Web channel, she would integrate the Web into all of Mellon's existing lines of business. Mellon would use the Web for the basic business of pleasing customers and continuing to create value for them.

"We felt we could add more value to the market by bringing such capabilities as our asset management, asset servicing, and employee-benefits consulting to the Internet," says Place. "Eventually, our large clients and institutional investors will be able to access all of this on the Web, using a channel that looks the same to everyone and that is navigated in the same way. We're just using the Web to let customers get information and services easily and quickly."

It's not a radical plan -- and that's exactly the point. But Place and her team are moving aggressively to leverage the Web: They have deployed 12 major applications; they are launching a new online application or enhancement every six weeks; and currently, they have 42 applications in development. In an interview with Fast Company, Place highlighted five rules for Webifying finance -- click by painful click.

Rule #1: The Internet changes everything -- but it doesn't change everything overnight

I am a big believer in technology, simply because technology has driven so much big change. The Internet changes everything: how we get information, how we learn, how we conduct business. But I was alarmed by the hype of the late 1990s, when the mind-set was "Fire, then aim" -- you didn't ever have to be ready.

Back in 1999, when I joined Mellon, quite a few people hoped that I would come in with great ideas for building e-marketplaces and communities of interest and self-service on the Web. I guess I disappointed a few folks. While all of that stuff is very exciting, none of it by itself will amount to anything. Other processes need to come into play.

For example, there's a lot of excitement over EBPP [electronic bill presentment and payment]. But we still haven't worked out the basic business model for EBPP. Who should pay for it? And who should be the beneficiary?

If I'm a merchant, I incur an added cost if I send you an electronic bill when all of my other customers want paper bills. So I'm going to pass on EBPP until most of my customers want to receive their bills electronically. Then it's in my interest to use it, because EBPP will lower my cost.

Yes, the Internet will fundamentally change the way we handle things like bill paying. But it's not going to happen overnight. We still need to lurch our way toward critical mass.