Technology, Knowledge and the Firm Implications for Strategy and Industrial Change PHẦN 5 potx

customer contacts over distance banking channels increased by 34 per cent

from 95 million in 2001 to 128 million in 2002. Some 35 million of these

were logons by Société Générale’s 675 000 Internet bank clients and nearly

41 million contacts were made by 1.6 million bank clients using the tele￾phone bank.

5.2 Distance Banking over Electronic Media – the Creation of

Minitel Banking

In the early 1980s France became the first country to launch a télétel system.

The French system was connected to a Vidéotex network and it consisted

of three principal components: the minitel terminal, an access network with

servers, and France Télécom’s system Kiosque Télétel for payments. All the

French banks utilized this system to provide certain types of information

to their clients. In 1984–85 Société Générale launched a test service that

gave its clients the possibility to check the balance on their bank accounts.

In 1987 the bank added the option to make transfers between the client’s

own bank accounts.

In 1989 Société Générale added a telephone bank service to the minitel

service. The bank used France Télécom’s system audiotel to provide a

24-hour and seven-day-a-week service for its customers. The audiotel

included a kiosque audiotel which included in the user’s tariff the cost of

communication and a payment to get access to the service. In 1989 the tele￾phone server was administrated by another firm. This firm played the role of

a distributor that supplied the interface between the bank and the clients and

the corresponding technologies. The bank transmitted to the other firm the

information about the clients’ accounts.

At the same time the number of minitel clients increased steadily and

reached 120 000 by 1990. This created bottlenecks in the server and Société

Générale decided to add new servers as the demand increased. Possibilities

to expand the services were discussed. In 1993 a meeting of chief executives

decided not to offer stock market transactions because it was considered

risky and that the clients could make mistakes.

The abundance of minitel clients and the bricolage structure of the

minitel product (duplication with nine servers with different access modes:

3615LOG1 . . .3615LOG9) resulted in a study on distance banking in the

coming years. On 30 May 1994 a directors’ meeting declared that the ambi￾tion of Société Générale was to be one of the leaders in terms of distance

banking products and to meet the demands of its customers on this matter.

According to a manager of distance banking services this was the time

when people argued: ‘distance banking is a revolution’ and when there

existed a willingness to create the service, and make the investments. One

110 Innovation and firm strategy

result of the renewed interest in distance banking was the decision to

launch a stock market option on the minitel because the competitors

offered it with success.

In September 1994 a project team were given the task of developing a dis￾tance banking platform for the private customers – this platform was called

Banque à DisTance (BDT). The aims of the project were: (1) remake the

ergonomy of the minitel; (2) add functions to the minitel, for example pay￾ments to external accounts, stock market transactions, and consultation of

the stock market; (3) change access to vocal server; and (4) create a tele￾phone platform.

The project group was rapidly moved to an organizational unit dedicated

to distance banking directly connected to the group that managed the retail

banking activity and organized customer relations. This gave it a relatively

high degree of freedom. A manager of distance banking services explains:

‘. . . the banking world is a bit rigid, we had some sort of start-up spirit...

We irritated everybody . . . Everybody was jealous of our position and the

means we were given to work.’

In parallel a benchmark conducted by the information department

resulted in a choice to use a new architecture called ‘the technical platform

BDT’. It would consist of a client–server architecture with accessibility

24 hours per day and seven days per week and the security system

demanded by Société Générale’s information system department.

5.3 Internet Banking at Société Générale

France Télécom opened its kiosque micro service in February 1995, a

private transpac network that was accessible through the number 3601 and

a PC with a modem. In 1995 there existed many different networks that

enabled firms and private individuals to get connected to the Internet, for

example e-world and Compuserve. In this competitive environment‘...

some of ours [Société Générale’s] competitors started moreover to utilize

this new technology and already tested PCs ... Société Générale had to

position itself in the micro informatics offer . . . Our competitors advanced

and it was necessary to maintain a dynamic brand image’ (Société Générale,

1995).

In March 1995 the BDT team presented a document in which they stated

that the kiosque micro offer was the most attractive choice because of its

billing system, its openness towards other networks and its flexibility. In

addition France Télécom promised that the system in the near future would

accept downloading of software.

In November 1995 Société Générale decided to install a web server. At

this stage most of the French banks had a web server, but no bank offered

Consumers and suppliers in electronically mediated banking 111

an Internet bank service. Some banks’ websites showed their annual report

while others also offered information about their services including answer￾ing questions from the clients.

To enhance its image in new technologies Société Générale decided to

offer its clients a selection of information on the Internet. In December

1995, Société Générale bought a server and placed it with an intermediary

to avoid all contact between the bank’s information system and the server.

The intermediary had the job of configuring the server, designing the web

pages, and adapting them to an Internet environment. At the same time the

BDT team suggested in a document that in the future, when the Internet

will be used as a distance banking service, it should be integrated with

Société Générale’s system. But before that could happen all the security

issues, for example coding, needed to be resolved.

In March 1996 the project to develop a platform ran into budgetary

problems. This problem was resolved during a budgetary meeting at which

priorities were set and a decision made on a more formalized budget.

In May 1996 the BDT team presented a document, with the functions

that they thought were necessary to get an attractive PC banking service

based on the kiosque micro. A project manager in charge recollected in an

interview: ‘. . . we get a service with the same functionalities as minitel.

It offers consultation, transfers, and stock transactions. We get it on PC,

with an Internet technology.’

In July 1996 a report ‘Information on Internet Products’ was elaborated

by the BDT team to realize the Internet project. Although the goals of the

project were similar, the work on the Internet project was different from the

kiosque micro over a private network. The report (Société Générale,

1996a) imagined a connection between the Internet project and the

kiosque micro. ‘ . . . the web pages with information about the services for

the Internet will be reutilized for the PC version of the minitel service

because of the ergonomic proximity (both used PC as a means of connec￾tion) . . . Nevertheless, the form will be adapted to the Videotex technol￾ogy . . . .’ The information on the different services offered by the bank was

planned to become identical. The Internet service appeared in January

1997 with general information accessible to everyone.

On 9 September 1996, a board of directors’ meeting discussed the devel￾opment of distance banking. The future of minitel compared with other

existing services was discussed. It was considered probable that the minitel

service, despite the efforts of France Télécom, would be confronted with

intensified competition on the one hand, with call centres, and on the other

hand, with PC connections in the near future. It was acknowledged that the

work on the BDT platform was running late and consumed more financial

resources than planned. Another problem concerned the delay relative to

112 Innovation and firm strategy