End-to-End Business Solutions for the Financial Services Industry

REDMOND, Wash., Nov. 16, 1999 — Never before has the financial services industry been so dynamic. Deregulation, mergers and acquisitions, and the rise of the Internet all have combined to create an industry that seems to change with each business day. Moreover, the economic boom of the 1990s has fueled unparalleled growth and prosperity for many financial enterprises.

This change also has meant great challenge. Currently, financial services companies wrestle with such issues as expanding service offerings, exploring new methods of distribution and moving beyond long-established customer bases and traditional lines of business. In addition, consumers increasingly desire one-stop shopping for their financial needs. To solve these challenges, companies are turning to computer technology, which holds the promise of providing greater services, increasing service manageability and cutting costs.

“Technology is critical to the future of the financial services industry,”
said Bill Hartnett, director of Financial Services at Microsoft.
“But it is not just technology. There are plenty of vendors out there willing to sell you software, but few truly understand the needs of your business.”

In contrast, the Microsoft Financial Services Business Solutions Group first seeks to understand the unique challenges facing financial services companies and, along with its solution partners, works to solve those problems.

“With business solutions based on the Microsoft platform, companies are guaranteed tested, industry-leading technology that addresses their unique issues,”
said Hartnett.
“Companies can then focus on their business objectives and rapidly adapt to the changing market for financial services. And, ultimately, they are well-positioned to benefit from the impending world of a deregulated financial services marketplace.”

A Foundation for Financial Services Solutions

Microsoft addresses the needs of financial services companies through its Financial Services Business Solution Group (BSG Financial Services). The group works closely with independent software developers, systems integrators, consultants and the industry itself. In this way, Microsoft ensures that financial services companies have access to leading solutions that conform to their specific requirements. To date, BSG Financial Services has launched several initiatives vital to technology advancements industrywide.

Windows DNAfs

Windows DNAfs is the financial services extension of Microsoft Windows DNA — an applications architecture that integrates both the Web and client/server models of application development. Using the Windows DNA model, independent software vendors (ISVs) are building modern, scalable, multi-tier business applications that can be delivered over any network.

What does this mean for the financial services industry? With Windows DNAfs, companies can get up and running quickly with new applications and services. According to Hartnett, Windows DNAfs is the perfect platform for financial services companies, offering a standard, plug-and-play environment that dramatically simplifies the task of offering traditional and Internet-based services.

“Windows DNAfs provides a flexible architecture for companies to integrate and manage all of their existing distribution channels, and rapidly get to market with new products and channels made possible by deregulation,”
he said.
“From a single platform, financial services companies can provide interoperability for all their applications, preserving their past technology investments while leveraging the power of the Windows 2000 platform and the Internet.”

This standardization is vital to driving efficiencies in the industry. Not only does it eliminate the gnawing problem of competing standards, but it also allows trading and counter parties to easily cooperate and collaborate electronically. From an employee’s perspective, DNAfs results in a greater efficiency. The architecture allows employees to enter the details of financial transactions just once, as opposed to re-keying data into disparate systems. In addition, it gives employees tremendous flexibility to deliver data easily through multiple channels, including electronically to employees or business partners, as well as via regular mail to customers.

Finally, Windows DNAfs offers two
for financial services companies: robust security and low cost of ownership. The architecture supports many diverse security solutions, as well as a simple, unified user logon and verification process throughout multiple applications. Moreover, it lowers the total cost of ownership by reducing the cost of new application development and by providing a platform that is highly scalable — allowing for future growth. It even extends the life of existing technologies by offering easy integration with legacy systems. This capability is vital for an industry that spent $51 billion on information technology in 1998 alone, according to Meridien Research.

“Windows DNAfs delivers on the promise of technology by turning information systems into a primary strategic asset for financial services enterprises,”
said Hartnett.


BizTalk is a Microsoft initiative aimed at driving the rapid and consistent adoption of the Extensible Markup Language (XML) to enable e-commerce and application integration. In financial services, it makes it easy for companies to integrate applications and conduct business over the Internet.

Both the BizTalk Framework and BizTalk Server are based on XML, a new standard that allows integration across industries and between business systems, regardless of platform, operating system or underlying technology. The BizTalk Framework creates a roadmap for consistent XML implementations so that a broad audience — such as the financial services industry — can adopt a common approach to using XML. It also enables independent software vendors (ISVs) to easily map business processes and provides them with a specific design as they build next-generation applications and e-commerce products.

“The BizTalk Framework makes XML truly usable for the industry,”
said Hartnett.
“XML has a lot of promise, but acceptance will be rapid only if the industry can agree on a common approach to implementation. BizTalk defines that common approach.”

The BizTalk Server is a complementary product that will greatly enhance the XML-based integration capabilities of the Windows DNA platform when it is released next year. It will reduce the amount of custom code that is often required when integrating applications and processes and will allow these, whether within or between organizations, to communicate seamlessly using Internet technologies.

Deploying Real-World Solutions

Windows DNAfs and the BizTalk Framework form a robust foundation for emerging financial services applications. And ISVs already are using the technologies to add substantial value for their financial services customers.

For instance, Atlanta-based n Front bases its full-service Internet banking solutions on the Windows DNAfs architecture. Supported by this platform, n Front offers applications — including n Home and n Business — that lets banking patrons use the Internet to conduct a host of transactions, including opening new accounts, applying for loans, viewing account balances and histories, paying bills, and many others. In addition, financial institutions can better market, advertise and sell their services using n Front’s comprehensive marketing services, n Action.

“Windows DNAfs has helped us to revolutionize banking,”
said Tripp Rackley, chairman and CEO of n Front.
“Thanks to our products and the robust DNAfs architecture, account holders have access to their accounts 24 hours a day, seven days a week from any Web-enabled device. Moreover, institutions themselves have powerful new tools to grow their businesses. In other words, small and mid-sized banks now have the ability to better prosper in a very competitive marketplace.”

Financial Objects, a leading banking ISV based in London, has committed to the Microsoft BizTalk Framework by developing the first of 30 schemas. These schemas enable the seamless electronic exchange of financial data and the integration of disparate financial applications. As a result, Financial Objects’ ActiveBank customers are gaining tremendous flexibility and ease of use from their banking solutions. The company already has a number of customers using XML schemas to communicate between such disparate applications as Web applications, call center applications, voice response unit applications and traditional banking packages.

“Microsoft BizTalk Framework-based schemas have been a boon to both our company and our customers,”
said Mike Finlay, executive director of the ActiveBank Application Architecture.
“Using the XML standard, our customers have found that mapping data between applications is minimal and requires no software engineering. This has enabled them to leverage Internet communication to reduce costs, speed time to market and boost their competitiveness.”

Services for Developing Tailored Solutions

Microsoft’s support for the industry doesn’t end with DNAfs and BizTalk. Microsoft has other initiatives tailored for financial services companies.

Microsoft Consulting Services (MCS)

Microsoft also provides highly skilled consultants trained in strategic planning, the sharing of best practices and project assistance. In fact, the company has a worldwide force of 2,500 consultants. More than 150 of these consultants are part of the Industry Services Group (ISG), which provides a unique combination of technical skills and industry experience in seven separate vertical industries.

With a nationwide team of consultants, MCS Financial Services (MCSfs) is one of these vertical practices. MCSfs assists customers in building
“line of business”
application solutions that leverage Microsoft products and technologies. In particular, its consultants assist financial services ISVs, strategic integrators and enterprise customers in planning and building next-generation, large-scale applications, typically in a three-tier architecture.

“The MCS Financial Services team has been extremely helpful in helping Cambridge deliver OatsTalk, a comprehensive NASD compliance solution based on BizTalk frameworks and Microsoft technologies in just 16 weeks,”
said Joseph Mathai, Industry Managing Partner of Cambridge Technology Partners.
“MCSfs provided a valuable combination of technical skill and financial services experience that allowed us to make best use of the Microsoft platform to build high performance solutions in rapid timeframes.”

ADP turned to MCSfs for support in scaling its Brokerage Processing Services (BPS) offerings to meet the future demands of its customers.

“With the support of MCSfs, we’re creating the next generation of BPS products for on-line users by fully leveraging the benefits of Microsoft’s latest technologies such as Windows 2000, COM+, Microsoft Transaction Server and SQL Server 7.5,”
said Brendan Malley, senior vice president, desktop product management, for ADP’s Brokerage Services Group.
“MCSfs consultants have a combination of domain knowledge and technical experience that is proving to be very valuable to our efforts.”

Dedicated Financial Services Resources for New York-Based Customers

In response to tremendous customer demand, Microsoft has established a local team of sales and service professionals specifically to serve the New York-based financial community. All personnel on the New York Financial Services team have significant experience with the key issues that affect the securities, banking and insurance markets. Now, for the first time, New York financial services customers have access to industry-specific account management, enterprise technical support and consulting services through the local Microsoft New York Financial Services team, Microsoft Premier Support and MCS Financial Services.

Microsoft Windows 2000

Numerous companies that develop applications and content for the financial services industry are lining up to support Windows 2000, Microsoft’s next-generation operating system. For instance, Reuters, Merrill Lynch and Compaq Computer all are announcing major initiatives based on Windows 2000.

“The financial services industry has always invested in the world’s leading technologies to give them the edge they need to compete,”
said Hartnett.
“Windows 2000 is the platform that is enabling a whole new generation of solutions — from traditional operations to e-commerce to knowledge management.”

A Partner in Industry Evolution

The financial services industry has never before evolved so quickly, and the pace will only accelerate. Financial services companies will continue to add new lines of business, and, in a short time, the Internet will change the way nearly everyone banks, invests and shops for services.

With initiatives like DNAfs, BizTalk and the Windows 2000 platform, Microsoft and its business partners are committed to developing leading solutions for the financial services industry. And as technology continues to shape services and best business practices, Microsoft will be there every step of the way.

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