From the August 1996 issue of Entrepreneur

Many banks now offer customized software programs or support popular money-management applications such as Intuit's Quicken, so individuals with personal computers can pay their bills or track personal accounts online. Since the mid-1980s, banks have also provided their large corporate customers with PC banking programs to track payments in real time. So what's available for small-business customers?

Not much.

The good news: Experts predict that's likely to change in the near future. Bill Burnham, an associate with New York City-based management consulting firm Booz Allen & Hamilton and leader of the company's recent Internet banking survey, says banks are beginning to provide online banking services to companies, including small businesses.

"Online banking services are probably better suited to business owners than to consumers because businesses need a real-time way to manage payments and keep track of their financial situation," says Burnham. "We think [the banks'] focus is going to change dramatically as [bankers] start to recognize small business's true potential."

In the past, online banking has been available primarily through dedicated software programs installed on individual users' computers. But Burnham predicts most of the industry's future growth will be in another area: the Internet. In fact, the Booz Allen & Hamilton study found that more than 30 banks expect to have Internet banking sites by early next year, and more than 500 say they will have such sites by the end of the decade.

Since May, Wells Fargo Bank customers have been able to transfer funds between their Wells Fargo consumer accounts, as well as pay their Wells Fargo credit balances, through the Internet (http://wellsfargo.com). It expects customers will be able to make payments over the Internet to other vendors in the near future. In addition, First Union's corporate trade customers can apply for commercial letters of credit online through its new service on the World Wide Web, called Cyberbank LC, which is accessible from First Union's home page (http://www.firstunion.com). Likewise, First Union expects to offer fund transfers and bill payments over the Internet by year-end.

Still, most Internet banking services leave something to be desired. Almost 90 percent, however, have aggressive plans for improving the size and functionality of their Internet banking offerings. Within three years, 69 percent of the banks surveyed plan to offer advanced services such as account balance inquiries and bill payments over the Internet.

Just how will Internet banking help small business? In the coming years, Burnham anticipates small-business owners will be able to apply for bank loans; check their deposits, balances and payments; review their financial histories; and even discuss account activity with an account manager via videoconferencing over the Internet.

"In the next five years," says Burnham, "you'll be able to conduct banking business remotely at any time of the day from your home, your office, and maybe even your car. From a small-business owner's perspective, this is going to be a great benefit."

Net News

Own a retail business? Need someone to talk to about today's fickle market? Bend someone's ear at Retail Advisors' Small Business Resource Center site (http://www.retailadvz.com). Subscribers to its BizTherapist service ($59.95 per month, six-month minimum) can discuss their retail business's personnel, sales, marketing and more with seasoned retail consultants; responses to inquiries are given within 72 hours via e-mail.

Also, be sure to check out the Ask Harry section, where you'll find about 60 small-business resources, as well as Harry's Internet Rolodex, which connects you to useful places like the FedEx, United Parcel Service and AT&T sites.

The Small Business Resource Center is a forum to share your personal wealth of information as well. You can recount humorous experiences in the Small Business Diary section or offer suggestions in the What Works for Me area.

Tick... Tick... Tick...

Listen up: Millennium experts say massive calculation errors will occur in your computer
system and software if they haven't been equipped to compute the new century properly. What's the problem? All dates need to be converted from the current six-digit format (12/22/96, for example) into an eight-digit sequence (12/22/2000)-or else computing blunders will occur in time-sensitive information such as accounting programs, databases, tax documents and more.

For most small companies using computers, there's still time to begin tackling this problem-but you need to act quickly. "For the small-business person, now is the time to strike," insists Jerome T. Murray, co-author of The Year 2000 Computing Crisis: A Millennium Date Conversion Plan (McGraw-Hill).

Why the rush? Murray estimates the entire date conversion process can take anywhere from two to four years. This includes the time needed to find and hire appropriate computer consultants and time for them to become familiar with your business's operations, diagnose the problem, develop a conversion plan and implement it. And the longer a company procrastinates, Murray warns, the slimmer the pool of professional personnel to choose from-particularly for small-business owners who don't have the deep pockets corporations have to solve this problem.

Conversion doesn't come cheap. Murray anticipates it will cost small companies anywhere from $500 up to $10 million, including costs for consultant expertise, new software tools, and potential profit opportunities lost to competitors that have already converted.

Unless you have the expertise, you'll need a computer consultant to get you started on the conversion process. Murray recommends interviewing several consultants to find one who has worked on this type of problem in a company of similar size and kind. Talk with your consultant often to track the conversion process. Then, once you're satisfied with the solution-and have conducted several test runs on your computer-it's time to implement it into your regular operations.

Book Smarts

If you're looking for an easy-and cheap-way to market your new Web site, consider calling your local telephone company. Several regional phone companies are beginning to list businesses' World Wide Web and e-mail addresses in their telephone directories. For instance, for a paltry $6 to $16, Chicago-based Ameritech will include this information in several of its directories' business listings beginning this fall. Or, you can add a line to your existing Yellow Pages advertisement free of charge.

Eventually, Ameritech plans to supply electronic versions of its telephone directories. The company says it will begin offering hypertext links to Internet sites in 1997.

Speak Up!

Finally, a computer that actually listens when you talk to it: IBM's newest version of its OS/2 Warp operating system, code-named Merlin, allows users to give vocal commands to their personal computers. Merlin's new speech recognition capabilities mean PC users can vocally navigate through menu bars and objects on the desktop to, say, open files, launch applications-even access Internet sites. Plus, the dictation component enables you to dictate memos and other documents, then paste them into word processing or e-mail applications to either print out or send on their way.

IBM says Merlin's speech recognition capabilities are about 95 percent accurate, with a base vocabulary of about 22,000 words. The system also supports six languages: U.S. and U.K.
English, French, Spanish, German and Italian.

Other new features include a cleaned-up interface with 3-D icons, a WarpCenter tool bar that accesses a task list indicating which programs are running, and a Warp button that quickly creates a view of everything on the desktop.

The newest version of IBM's OS/2 Warp is expected to be available by year-end.

Contact Sources

Ameritech Advertising Services, 100 E. Big Beaver Rd., 15th Fl., Troy, MI 48083, (http://www.ameritech.com);

Booz Allen & Hamilton, 101 Park Ave., New York, NY 10178;

Jerome T. Murray, 5493 N. Via Frassino, Tucson, AZ 85750;

Retail Advisors, 1463 E. Republican, #174, Seattle, WA 98112, (206) 324-2627;

Wells Fargo Bank, (800) 423-3362.