MIS Quarterly Executive


Since the beginning of business computing, financial services firms have been major innovative users of IT. In particular, banks have used IT internally to enhance their efficiency and effectiveness and externally to improve their customer service and competitiveness. However, they have typically confined their IT use to financial applications. IT could be used to offer e-business services beyond financial applications, seamlessly integrating services from business and government providers.Nordea Bank, headquartered in Stockholm, Sweden, has done just that, and has differentiated itself from its competitors. It has augmented its e-banking portfolio by adding an e-business platform through which it offers both its private and corporate customers the value-added e-business services of e-identification, e-signature, e-billing, e-salary, and e-payment. Several of these e-services have become widely used standards in the Nordic region.Nordea Bank’s evolution of services teaches seven lessons about moving into e-business: (1) start new IT initiatives early and with a modest investment, (2) combine high-tech services with a high-touch capability, (3) entice customers to move to cost-efficient channels, (4) pro-actively manage online/offline channel conflicts, (5) leverage the existing online customer base to acquire new online customers, (6) decrease risk of fraud by using instant e-payment, and (7) leverage existing technologies to create new value for customers and for the firm.