Olivetti North America, a leading supplier of branch automation systems, has embarked on an aggressive upgrade of its product line.

The Spokane, Wash.-based company, which went by the name ISC/Bunker Ramo until it was changed earlier this year to reflect ownership by its Italian parent, has begun redirecting software development efforts toward an "open systems" design.

The benefit of open systems software is that it is easily portable to a wide range of computer hardware platforms. Olivetti is hopeful that expanding the compatibility of its products will help it compete in an increasingly competitive branch automation market.

Healthy Competition

According to industry experts, the branch automation market in the U.S. is highly fragmented, with no single company dominating.

The level playing field has created healthy competition for bank business among vendors, many of which have revamped their product lines in an effort to improve their position in the market.

Earlier this year, Unisys. Corp., Blue Bell, Pa. unveiled plans for a new line of branch automation products based on object-oriented technology.

The scramble for market share also led Electronic Data Systems Corp. in Plano, Tex., last month to acquire Amper-sand Corp., which makes per-sonal-computer-based branch automation software.

Loss of Credibility

In the past, Olivetti North America has always held its own among stiff competition, and the ISC/Bunker Ramo name has been well regarded by most bankers.

In recent years, however, experts said the company has not been as aggressive as its competitors in upgrading its technology. As a result, it has lost some of the credibility it had in the late 1980s.

"They've certainly fallen off the radar screens of many banks," said Gregory Schmergel, a vice president with the Tower Group, based in Dover, Mass.

"Now they need to make a strong statement about who they are and what they plan to be doing over the next three to five years."

The move to open systems appears to be Olivetti's effort to do just that. Like the product launched earlier this year by Unisys, Olivetti's Application Builder will be centered on "object-oriented" gramming, in which pieces of software can be mixed and matched to quickly create new functions at platform and teller stations.

"You cannot base your business on hardware sales anymore -- the market's totally changed," said Thomas Oxendine, vice president in Olivetti North America's software division.

"A company like ours regains its margins from its systems business, which consists of the software product and the service to implement those products."

Olivetti is hopeful that the move to open systems will also enable it to extend its reach beyond the branch and into other banking offices.

Test Under Way

According to Olivetti officials, banks now using the company's two existing branch automation systems, known as Aladdin and Pinnacle Plus, will be able to migrate to the new software, which is still under development.

Application Builder -- which will initially consist of applications for the platform, teller, and, possibly, lending -- is currently being tested at a bank that Olivetti declined to name. The software will be ready for general release by the first quarter of 1994, Mr. Oxendine said.

Olivetti's new push coincides with many banks' desire to revamp their branches. According to a study published by the American Bankers Association, over 30% of banks with less than $5 billion assets plan to install new systems for platform personnel by the end of 1994.

"The market's better than it's been in four or five years," Mr. Oxendine said.

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