Upward mobility is the rule in Banc One Corp.'s credit card area.

Within the last two months, three top-level managers have gotten promotions, underlining the Columbus, Ohio, holding company's preference to build and reward home-grown talent.

What might look at first like musical chairs is just a reinforcement of the 10th-largest credit card bank's strategic direction, analysts such as Moshe A. Orenbuch of Sanford C. Bernstein & Co. point out.

Move to Centralize?

But some observers also speculate that Banc One is subtly altering the decentralizations philosophy that has served it well in the general banking business, but that may not be as successful in credit cards.

Jeffrey P. Neubert, chairman of Banc One Diversified Credit Corp., denies any such shift.

"Centralized is the wrong word," he said last week. "We are becoming, instead, more standardized and consistent. Our strength lies in the regional ties we have."

Still, the key personnel actions have taken place at headquarters in Columbus.

Change at Card Subsidiary

They began in October when Richard D. Headley, 45, was named chairman anc chief executive officer of Banc One Services Corp., the holding company's technology and data processing arm. Mr. Headley, an 18-year veteran of Banc One Corp., had headed Banc One Credit Card Services Co. for less than a year.

Industry experts say Mr. Headley's short tenure at the card subsidiary wasn't a blot on his performance. More likely, quite the opposite.

"Typically when someone is in and out of a job in a short time, it is an indication of failure, but that doesn't hold true in this case, because Mr. Headley has been give an enormous amount of responsibility" said Donald J. Auriemma, president of Auriemma Consulting Group Inc.

Mr. Headley was succeeded by Mr. Neubert, who held the credit card job temporarily while heading the broader diversified credit organization, which also consists of Banc One Leasing Corp. and Finance One Corp.

Heading Credit Cards

Mr. Neubert - an "outsider" who joined Banc One in 1991 after 17 years with Citicorp -- handed the credit card company's reins this month to Mark K. Tonnesen, 42, who had overseen the card program of the lead bank in Columbus.

Donald E. Lundblad, 38, who has been with Banc One Corp. since 1977 and the Bank One Columbus card division since 1984, has taken Mr. Tonnesen's senior vice presidency at the Columbus bank.

Mr. Tonnesen's new assignment is orchestrate the entire holding company's MasterCard and Visa efforts. He consults with, but does not necessarily dictate policies for, the 79 subsidiary banks in 12 states.

The alleged centralization appeared to take shape under Mr. Headley, when Banc One's farflung card operations were consolidated into four servicing centers.

Prior to that move, back-of-fice operations were handled by at least 25 separate banks. "As we acquired new banks we left their card operations intact," said a spokesman for Bank One.

The central units, brought together by Mr. Headley, are in Columbus, Milwaukee, Phoenix, and Lafayette, Ind. -- all bases of banks that Banc One has acquired in recent years. The Columbus center is responsible for all cards issued in the East, Milwaukee handles the Midwest, and Phoenix the West.

|Market Consistency'

The Lafayette operation oversees Banc One's affinity program with the American Automobile Association, while Columbus is responsible for all national mail solicitations and the larger affinity programs.

"Over the last 12 months, Banc One has been consolidating its independent affiliates to create greater market consistency, and we'll continue to see this kind of activity," said Joel P. Friedman, managing partner at Andersen Consulting in San Francisco.

Mr. Nuebert said Mr. Tonnesen's promotion to president of Banc One Credit Card Services will free him up to focus on Banc One's $1 billion private-label card business in Dayton, Ohio, and on merchant processing, a part of the card business in which Banc One ranks 10th nationwide.

As for the quick succession of management changes, "We went through 1993 adding more talent to the credit effort," said Mr. Neubert, 51. "It is simply an indication of our commitment to the business."

Many in the industry were not surprised by the rise of Mr. Tonnesen, and some expected it would have happened sooner. The executive became well known in credit card circles while heading the Columbus bank's $3 billion program.

"He is very established in the industry and a formidable competitor," said Jerry D. Craft, executive vice president of Wachovia Corp. and head of its credit card business.

Mr. Tonnesen said he will concentrate on creating a more diversified portfolio, including more value-added products.

Banc One Corp. has broken new ground with the picture cards it is issuing to customers in Arizona, and it is the first U.S. bank to issue MasterCard or Visa credit cards with computer chips inside, known as smart cards.

Another innovation was the purchase protection plan for cardholders it has gained through the American Association of Retired Persons, an affinity program that Mr. Lundblad had been managing since 1990.

There will also be an increased emphasis on the cross-selling of products, and more of a national focus, Mr. Tonnesen said.

Video for Delinquent Payers

In earlier interviews, he had spoken about creating an environment where innovation thrives by delegating authority to the front lines.

Not shy to test the limits of available technology, Mr. Tonnesen went after delinquent credit card borrowers by producing and delivering videotapes in which he spoke directly to the debtors. The bank's collection rate when up 174%.

In his new position, Mr. Tonnesen plans to continue fostering the kind of innovative spirit in which the the video was produced.

"I intend to dedicate myself to the 2,000 or so people who are in the credit card issuing business here," said Mr. Tonnesen.

He sees continued research and development on the smart card, which is a cobranded venture with Advanced Promotion Technologies, a Pompano Beach, Fla., developer of electronic marketing systems and frequent-shopper programs. "We are looking for profits in 2000, not 1993," Mr. Tonnesen conceded.

He stressed that there will be "zero changes in our marketing strategy," or to the holding company's commitment to the autonomy of its bank affiliates.

Mr. Tonnesen's successor, Mr. Lundblad, will be one of the many regional banking executives Mr. Tonnesen will be dealing with, but the size of the Columbus program makes him slightly more equal than the others.

Before becoming vice president and general manager of the AARP Visa group, Mr. Lundblad was an assistant vice president in Banc One Services Corp.'s credit union services division for three years. He joined Bank One Columbus in 1977 as a management associate in consummer a number of banking and later managed a number of banking centers before moving to the card division in 1984.Banc One Credit CardServices Co.Holding Banc One Corp.companyAffiliate banks 79Headquarters Columbus, OhioChief Mark K. TonnesenexecutiveOutstandings $6.6 billionIndustry rank 10(*)(*)American Banker ranking at midyear

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