MINNEAPOLIS- Community banks must make the most of technology, but not to the detriment of service, says Allen I. Olson, president and chief executive officer of the Independent Community Bankers of Minnesota.

Last week, Mr. Olson presided over FutureBank '94, a technology exposition for Midwest community bankers that he developed.

The expo, which showcased a life-size model of the "community bank of the future," offered the latest innovations in every aspect of banking, including ergonomic drive-up automated teller machines and voice-response telephone systems.

Community bankers can and should - explore using new technology, as long as they don't abandon one-on-one customer relationships, said Mr. Olson.

Mr. Olson, 55, a former attorney general and governor of North Dakota, discussed the importance of the expo with American Banker during a lunch break

Q.: Why do independent community bankers need this type of exposition now?

OLSON: We are at the early stages of what I consider to be a dramatic revolution in how information is moved and analyzed.

Community banking is particularly technology and information dependent, and it was our conclusion that community banks didn't have reasonable access to all of the changes and the products that were being developed.

Q.: Are there particular types of technology that you think community bankers should be using?

OLSON: Bankers tell me that the most critical [technology] right now for many of them is voice response, when customers can call in and get all types of routine information that they would otherwise have to travel to the bank or write letters [to receive].

[Also, with] check imaging they're beginning to feel that they need to at least consider installing that process.

And as small banks consolidate into mini-multibank holding companies, the need to communicate well, including body language, suggests that teleconferencing will be important soon.

Q.: Can community bankers afford this technology?

OLSON: With every new product or service, it comes in at a high cost and only the large institutions with significant resources can afford that.

But what's happening now, in the explosion of information communications technology, is that it's been out long enough now where we're reaching a level where it's affordable for smallbusiness, small banks.

Q.: How should community banks balance new technology with the personal service they've typically focused on?

OLSON: That is the key question. It's probably the most important question for community banks right now. Their historical niche in the business - and I believe the niche for the foreseeable future - is service.

If the bank installs a voice-response system, that means that the bank employees will be ... distanced somewhat further than they were when there had to be that face-to-face communication.

Every community banker I've talked to in the last year or so is concerned about that, knowing that the technology improves their service in one sense and it meets the competition, but, it also affects that personal-service relationship.

I can tell you this: They're not being blindsided. I appreciate that they're all considering that point.

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