Bankers who are trying to make sense of the client-server fashion might do well to look outward at one of their nonbank competitors.

Household International Inc., the diversified financial company that has long prided itself on pressing technology's limits, has embraced client-server in a way that contrasts with many banks' more tentative testing of the distributed-processing waters.

Household International is in the midst of a sweeping, $94million project to move almost the full weight of its operations to client-server systems, which entail a move away from traditional, centralized mainframe solutions by putting more computer power in the field and closer to customers.

A Technology Model

Although the parent of Household Finance Corp. and Household Bank may seem to be taking drastic and possibly hasty steps into uncharted technology waters, executives say the moves are necessary and carefully calculated. And there may be a lesson in this for other companies.

Because Household International's business units are autonomous, with varying Computer setups, the company needed a unifying force, particularly while expanding.

"We've branched into seven or eight businesses over the past decade," said David Barany, chief information officer, who is based in Northbrook, I11., not far from headquarters in Prospect Heights. "It caused concern that there's only so much flexibility you can provide a user on the mainframe."

In the past year alone, Household has made at least five major acquisitions. The company had to build a system that would envelop these new. additions as seamlessly as possible or, according to Mr. Barany, "we would have islands of disconnected technology."

The company has come a long way since 1878, when it started what is still its core business loans to the middle class. In 1976, it chartered Household Bank in Newport Beach, Calif., a consumer bank that became a force in credit cards, processing the General Motors MasterCard, among other proprietary and co-branded programs.

"We realized in short order that we needed open systems standards" to manage the company's diversification, Mr. Barany said.

Open systems, Household executives felt, would provide an opportunity to share software across the various divisions and thereby leverage the available data to the fullest extent.

Although the multiyear conversion to Unix-based systems is not expected to be done until the end of 1997, most of Household's retail operations have made the switch, according to Kenneth Harvey, vice president of enterprise systems, These include parts of the vast credit card business as well as more than 200 branches in the United States, 150 in Britain, and 50 in Canada.

The objective of the clientserver project is to convert 80% of the company's operations load from IBM and Amdahl Corp.. mainframes. But Mr. Barany cautioned that the company intended to maintain its two remaining mainframe sites - in Salinas, Calif., and Prospect Heights, Ill. - to act as acommand center for some of the larger-scale processing activities.

Household Financial Network - the division directly under Mr. Barany - oversees and supports the technology needs of the rest of the holding company, but Mr. Barany stressed that the business managers themselves have become very involved in every aspect of operations.

"The rule here is that the users must manage the technology," he said. The information technology department "facilitates business-user requirements."

This management initiative is aimed turning once-apprehensive business managers into technology-literate users able to make more educated decisions for their units.

While the business units control their own technology decisions, the information--technology managers work closely with them, trying to ascertain their needs in "jam sessions" and overseeing the actual system implementations.

The client-server nature of the new systems saves time in training and implementation, according to Mr. Harvey. While an older mainframe system could take as long as three to five years to roll out, Household has been able to convert subsidiaries to its Unix-based model in as little as three days.

Some proponents of clientserver technology say Household could be buying as much as three years of time against slower-moving competition.

"There's been a very slow adaption to client-server in the financial industry," said Richard Crone, a senior manager in KPMG Peat Marwick's consulting practice. "Other industries have embraced it much faster."

While some banks have sought leadership in the clientserver trend, the industry in general has "this monumental investment in brain-dead terminals. and they just don't want to put in the dollars to replace them," Mr. Crone said.

Many of his financial industry clients, he added, have not replaced front-end systems in as much as a decade. And when a new system is installed, there remains a temptation to stick with the familiarity of mainframes and "dumb" terminals, which lack the inner workings and processing power of PCs.

Mr. Crone noted that like Household, many banks have been placing more of the power to make technology decisions in the hands of PC-literate business managers, which he calls the "new computing democracy." So far, though, he has seen "very few living breathing examples" of companies turning this to their competitive advantage.

"What I see Household doing is trying to address the usersspecific environments with tools that they know and understand and can manipulate," he said.

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