The Application Management Interface standard's focus is to help IT managers prioritize IT functions based on their business impact. That standard is a mantra at J.P. Morgan. Internally, it meant creating a system to manage technology effectively inside the company, with its 46 offices in 36 cities. J.P. Morgan built a tool that helps define controlled targets and measure the IT status of those targets and ultimately identifies improvement areas over time. This, according to CIO Peter Miller, increases efficiency and the quality control over the IT environment.

Adjusting the company's internal architecture to be in line with the business impact of E-commerce and customer demands that arise from it is key, Miller says.

As part of that program, J.P. Morgan created Morgan Markets, a four-month-old Internet research aggregator for the bank's clients. Another program is in progress with PricewaterhouseCoopers and IBM to create a standard for Web transactions of financial derivatives products. "We have to have a lean and mean applications portfolio, and we have to ruthlessly differentiate what we invest in," Miller says. "That includes adjusting the architecture to handle clients' needs [from the initial engagement to the completion of a transaction]. That includes an increased ability to handle worldwide transactions and decrease the time to settle a trade from three days to one."

Decreasing process time has been the directive at the Federal National Mortgage Association, the largest nonbank financial-services company in the world. Fannie Mae, which has provided more home mortgages in the United States than any other institution, has been able to decrease mortgage application time from 30 days to a matter of hours and reduced the cost of processing an application by as much as $1,500.

It has done this through a proprietary software application called Desktop Underwriter that initially was linked to only two credit bureaus. Today, it serves more than 50,000 registered users and is integrated with more than 120 credit- reporting agencies through one interface.

Like many banking facilities, Fannie Mae plans to use the Web to deliver real business value. Desktop Underwriter will be online and able to handle transactions around-the-clock this fall, according to Harvey Trumbull, VP of Morenet Plus, Fannie Mae's mortgage underwriting software division. But, while creating a Web interface is easy enough, Trumbull says, making sure it serves all the needs of such a large customer base takes a little more finesse. "What we're trying to do is connect the front-line technologist with the impact that they have on someone else's business," he says. "We stress that if our technology isn't working, then the lender who's depending on it is out of a deal."

One way Fannie Mae has impressed that importance on its IT staff, which comprises one-third of all Fannie Mae's human resources, is to have employees go to a mortgage banking school run by the Mortgage Bankers Association of America. "We encourage as many folks as possible to go to that school and understand the industry they're serving," Trumbull says.

A set of proprietary Web objects, some of which will be migrated to Java, that project teams can plug in to their development processes is another behind-the-scenes facilitator at Fannie Mae. The ready-made processes can be deployed so efficiently that 300,000 lines of code were streamlined into 12,000 in a recent app rebuild.

As efficient and simplified as some of these innovations may be, they're not to be thought of as new for long, says Ernst & Young's Rossettie. "Banks have had the king-of-the-hill position as being the intermediary between people and their money for 1,500 years," he says. "Suddenly, that role can be obviated by greater connectivity over the Internet, and that threatens those who will be out of the loop. It's not a choice. Part of a bank's everyday business is being sharper, more agile, and astute enough to pick those technologies that will keep them ahead of customer demand."

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