Ask an executive in any bank's back room to name the most time-consuming and labor-intensive service they provide. The answer you're most likely to get is check research.

Some bankers, though, are radically changing their research operations with the help of new technologies that automate the research and retrieval process. And the rewards they reap from these endeavors can be substantial.

Annette Hazapis, vice president/banking operations at Cleveland's Key Services Corp., is one such banker. Relying on a combination of optical disk technology and research automation software, Ms. Hazapis has managed to dramatically improve the efficiency of her company's check research operation - slashing as much as 12 days off the time it takes to fill some copy requests in the face of a dramatically increased workload.

"We've seen a dramatic increase in productivity," she said of Key Services' Ohio research shop. "Overall, productivity for the department has gone up 25%, and that's taking into consideration a 40% increase in volume."

The information and technology services unit of Keycorp, a multibank holding company with operations in 25 states, Key Services provides back office support to 1,300 bank offices and branches throughout the United States. Currently, the research department's automation efforts are limited to check and statement requests from its Ohio operations, which average about 6,500 requests a month. But given the success it has had in Ohio, Ms. Hazapis said it shouldn't be long before most of Keycorp's research request functions are automated throughout the 25-state operating area,

"It can be integrated easily," she said of Keycorp's research automation project. "The way the system is designed, it's easy to integrate into other Key Services locations."

It also simplifies the leap to image check technology by allowing the bank to access both electronic and nonelectronic storage media. "This system gives us the ability to pull images from an image archive as well as microfilm and optical archives," said Ms. Hazapis. So it eliminated the need to retool the research department should the bank decide to move to check imaging.

"Image archive access can be a very expensive investment," noted Mike Israel, vice president at Antinori Software Inc. in Atlanta. "With a system like this, they don't have to buy new software; the bank's investment can be leveraged to handle image."

Future investments in imaging aside, the business case Keycorp established for automating its check research operation was based on two key factors: Savings in time and labor and the opportunity to make a transition from operating as a cost center to operating as a profit center.

"With this type of automation, the back room can become a profit center because it becomes so much more productive," explained Mike Gumaer, manager, financial markets, at Eastman Kodak Co. in Rochester, N.Y.

The system installed at Key Services, which combines research and retrieval software from Antinori Software and optical disk hardware from Kodak, certainly holds that potential, said Ms. Hazapis. It also allows the bank to customize pricing. "The opportunities are there, for example, to charge a different fee if you want a speedier turnaround time, or if you want the copies faxed to you," explained Ms. Hazapis.

Even better, Keycorp now has the means to track copy requests, fee income, worker productivity, and other dynamics of the research process, she said.

Like most banks, Keycorp limits the number of check copy requests a customer can make before triggering a fee requirement. So now, when a customer comes in to request a copy of a check, the customer service representative can automatically determine when entering request information into the system whether that customer has exceeded the allotted number of free copies and, when necessary, determine how much to charge for the requested copy.

Ferreting out and photocopying customer requests for checks that have cleared against their accounts, or reconstructing their monthly checking account statement, is tedious. In the past, said Ms. Hazapis, it would take three days just to track down one check, photocopy it, and send it off to the requesting customer. Statement reconstructions took even longer to complete, she noted - about three weeks.

Today, Key Services can fill the typical check copy request within a day, said Ms. Hazapis. A statement reconstruction takes a bit longer, but at an average of three days, she noted, can be filled in considerably less time than in the past.

"There's virtually no human intervention," said Ms. Hazapis.

Here's how the process works. When a customer requests a copy of a paid check, a Keycorp customer service representative enters into a personal computer the customer's account number, as well as the number and amount of the requested check. With the push of a button, the information is transmitted to a mainframe computer system at Key Services. The request is then batched together with those from other customers, and those batches in turn are downloaded throughout the day to PC-based workstations in the Key Services research department.

The information sent to each workstation is organized into reports that tell each operator where to locate microfilmed checks in an optical disk storage library. The only real physical exertion required of the operator is to load the film; once the film is loaded, the workstation automatically advances it to where the requested images are stored. With the push of a button, the requested document can be printed or faxed, and a confirmation sent to the employee who originated the request.

Statement reconstructions take longer, but are simplified by the fact that electronic images of every statement rendered by the bank are now stored on optical disk, thus eliminating the need for producing copies of pages from microfilm.

Ms. Hazapis noted that the current operation is a far cry from the days when researchers had to deal with upwards of 50 pieces of paper in their research endeavors, engaging in tugs of war over microfilm, and cutting and pasting together copies of the microfilmed images of requested checks. "It was ugly," said Ms. Hazapis of way the company used to handle copy requests.

Since Key Services began using its new Antinori software and Kodak hardware in April 1994, the improvements in microfilm productivity have been dramatic, said Ms. Hazapis. Whereas in times past the typical researcher could ferret out 18 items an hour, today the average is 37 items an hour. And this in the face of a spiraling workload. "We've had no staff cuts, but we're getting out 40% more work quicker and better," said Ms. Hazapis.

Much of the added workload, conjectured Ms. Hazapis, derives from the fact that Keycorp is more responsive to customer copy requests. "Now that we've made it easy for people to request items, and they receive them on a timely basis, they seem to use the system more," she said.

Despite the additional workload, Ms. Hazapis said the new automation project, which carried a price tag of about $550 million, will pay for itself in a little more than two years. In addition to labor savings, Ms. Hazapis said she also expects to slash the amount of space used to store check and account statement copies. Previously, she noted, one month's worth of microfilmed customer statements would consume about 20 inches of file drawer space; today, that same amount of information can be stored on a 5#1/4-inch optical disk.

What makes research automation work well for Key Services, Ms. Hazapis said, is that it enables the company to improve customer service. Everything from the speed with which copy requests are filled to the quality of the copies provided has improved with automation, she said.

"We've been able to dramatically improve service levels in line with our objective of providing world class service," explained Ms. Hazapis.

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