THE BANKING INDUSTRY COPES WITH TECHNOLOGICAL-CHANGE

In recent years, the banking industry has sunk into its worst financial crisis since the Great Depression. Through the 1980s, the industry average return on equity declined steadily, and almost a quarter of all U.S. banks were in the red by the end of 1990. Clearly, the industry faces major dilemmas surrounding its investment in and use of technology. What effects did the technology investments of the past have on industry profitability? How can the industry cope with the technological change in the future? The banks that are most adept at managing will spend just enough on routine technology and will focus the rest of their efforts and money on the creative and the unique. The losers may well overspend in areas that bring nothing new to the customer.