By Michelle Rae Gula, president and CEO, mrae associates, inc., a community bank consulting firm. You can email her at mgula@mraeassociates.com
 
The battle of technology versus human interaction continues to wage. Last year was widely touted as "the year people stopped talking."
 
But I believe the competitive advantage balance could shift this year to favor personal interactions over pure technology.
 
"The Year People Stopped Talking"
Where did that come from? Widespread speculation based on anecdotal evidence was bolstered by facts such as these from such sources as CTIA-The Wireless Association, Nielson Co., and the International Telecommunication Union :
 
• 93% of Americans have cell phones/wireless
 
• 90% of the global population has access to mobile networks
 
• 29.7% of cell phone users are using smart phones
 
• 1.8 trillion mobile text messages were sent from June 2009 to June 2010
 
• 56.3 billion mobile multimedia messages were sent from June 2009 to June 2010
 
And, in the midst of all of this "non-talking," financial institutions have been working overtime to stay ahead of the e-banking trends.
 
Understandable. But is this the basket that should hold all of the eggs?
 
Could IT advances be outplayed by actual face-to-face communication?
 
What do the customers really want? Man or machine?
 
Take a cue from tech savvy institutions
Answering that question with action, the return to more intimate relationships has already begun among tech savvy institutions.
 
• Essurance-This online insurance company has been taking this approach in their marketing campaign titled, "People when you want them; technology when you don't."
 
• INGDirect, a leading industry provider of financial online applications is following suit by telling customers to call to talk to a "real person."
 
•  PNC Bank's Virtual Wallet is a very electronic product set. This provides an incredibly interactive online viewpoint of accounts, spending tracking, bill pay, savings, etc... for younger customers. However, PNC balances the highly technological product offerings by pushing the one-on-one relationship angle through its "Chat with a ‘live' PNC representative" promotion. This approach targets the banking products and services for mature and small business accounts.
 
A bank that offers two roads
Let's take a closer look at how some of this thinking can be applied. Alliance Bank, N.A., Syracuse, is a $1.4 billion-assets institution in upstate New York that has an angle on this challenge.
 
Alliance Bank has successfully balanced customer service and technology through the differentiation of the two delivery types in their online presence.
 
They have implemented a culture of this balance through two separate online experiences. Their main webpage leads you in the traditional bank website manner in which to find information and how to open accounts, etc. But Alliance also offers a separate website titled "Alliance Everywhere," which speaks directly to the tech-savvy customer and online banking user.
 
This dual approach provides two channels for the customer to interact with the bank. The main website opens with a message from their management team.  Dig one level deeper and you get this people-oriented message:
 
"...the one thing that truly sets us apart is our people. Many came from other, often larger banks because they wanted to deliver a different kind of service. Our people build relationships. They solve problems. They work with customers individually and offer products that match anything delivered by the bigger competitors."
 
At the same time the bank prominently displays the avenue to get to the online portion. On the separate website created for the online user they balance the ability to not only learn about the online offerings but they provide a forum to open an account online. Yet there is a clear message that there is always "someone" customers and prospects can call, which makes this site just as valuable.
 
The customer is able to gain both immediate attention through an online service as well as gain insight into what the bank is about and how they will be treated.  [Alliance recently shared basic plans for its new "Personal E-Suite" line in Pass the Aspirin online. Click here to read that column.-Editor]
 
But what about Gen Y?
You've read a great deal about Generation Y. Gen Y is an important market for banks for three main reasons: exposure to the market, influence on household spending, and its size.
 
It is especially important to remember that Generation Y teens are destined to be the largest teen population in U.S. history. At 60-70 million strong-more than three times the size of Generation X-Generation Y is the biggest group to hit the American marketplace scene since the 72 million Baby Boomers.
 
Also known as Echo Boomers, Generation "Net," and the Millennium Generation, Gen Yers value social networking in the form of cell phones, email, texting, Facebook, tweeting, etc. Whether good or bad, their experiences are revealed to the world immediately through these mediums.
 
Being exposed to media from all sides; these kids are becoming active and sophisticated consumers at an extremely young age and an extremely fast rate. For example, last year, 6 to 11 year olds (as the kids' market is generally defined) spent $25 billion of their own money and influenced another $187 billion of spending.
 
Now, some harder reality.
 
This generation is not without problems. In fact Gen Yers may face more financial problems than any of us have seen.
 
They are inheriting a crippled economy, rising debt, and tight credit. They will need homes, cars, and businesses that they may not qualify for in this post-recession environment.
 
This requires a different form of customer service. You can become part of their social network. Don't confuse their remote interaction with apathy.
 
This generation will need the same products and services that their parents and grandparents did. They'll just want it delivered through a different medium. Are you prepared to operate within that space?
 
Invest in technology? Or your own people?
So, what the industry needs is balance, and each bank must find what's right for its own circumstances. In the midst of all these developments, there is the question of the future of the branch. Some speculate that physical branch locations, a booming delivery mechanism not so long ago, were becoming extinct in the new world of advanced technology.
 
I urge some moderation here. Although technology in your branch must be on par with the industry, people remain the foundation of community banking.
 
But the distinction today isn't just about people. Rather, it's the types of relationships you gain from the various forms of communication.
 
By its own ever-evolving nature, technology is fleeting, always begging the question, "What's next?" Conversely, when it involves a name, a face, and a willing ear on the receiving end of the phone or the teller line, the time-honored (but sometimes forgotten) rules of solid relationship banking apply.
 
• What balance makes the most sense for your bank's model?
 
• Are you staring down attrition as a result of an elderly customer base?
 
• If so, how are you gaining today the relationships you'll need decades from now?
 
• Are business relationships up for grabs in your market?
 
• Do you have a front line who understands their unique need set?
 
The case for investing in talking
There are many institutions that perhaps can't afford the latest technology; however, they could stand to make a small investment in their own people. For them, it may make better business sense to budget funds for training and sales force development programs.
 
The payoff of the people-investment route might be greater across all sizes of institutions. It doesn't mean you should ignore technology, but instead weigh what makes the most sense against your bottom line and what you feel would deliver the most impact in the long term.
 
As I said, technology is always changing. What can you more readily harness and/or influence: your people or your machines?
 
Talk back! Where is your bank putting its own chips? On people, technology, or both?