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Trading Technology

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CIO Challenge

THE CHALLENGE: As more and more clients look to conduct transactions via electronic channels, investment management firms are improving their electronic servicing systems. Boosting online search capabilities and integrating call center systems and Web platforms can enhance self-service.

E-servicing can improve self-help functionality, reduce mundane inquiries to call center agents and allow staff to focus on more-complex and higher-value queries. Done properly, it can mean providing better service at less cost.

Barry Mione knew that Harrisdirect had hit a technology home run while showcasing the firm's new, natural language, online self-help query tool, "Ask Harrisdirect," at a retail investor trade conference. As Mione, the firm's managing director of client services, was showing a prospective client how the technology worked, another consumer joined the conversation. The next thing Mione knew, the first consumer was explaining to the second consumer how simple the tool was to use.

"He did the same thing I would have done," Mione says of the consumer's product demonstration. "It shows how easy and interactive" Ask Harrisdirect is, he continues. "I just stepped back and watched. It was great."

Harrisdirect is the first online broker to launch what New York-based technology firm Conversagent calls an automated service agent. The Harrisdirect tool relies on Conversagent's enterprise search technology to engage clients in a two-way, natural language online text chat. Other providers in the natural language search space include San Bruno, Calif.-based Inquira; Sunnyvale, Calif.-based Verity; and Bedford, Mass.-based iPhrase Technologies.

Using Conversagent's technology, clients can pose questions to the Ask Harrisdirect "agent" as if they were speaking with a live agent. The question is answered immediately, almost as if there's a live person on the other end. However, there is no live agent involved - the software generates the response automatically.

Instead of generating a list of search results based on a few keywords or phrases, the tool breaks a sentence down and analyzes each word in context. It then scans the firm's knowledge base, such as frequently asked questions, and generates the most applicable answer.

By asking the online search tool, "How much does it cost to trade a stock?" a user is presented with Harrisdirect's fee schedule. Asking, "Do you sell ETFs?" returns a statement on how exchange-traded funds may be bought or sold, with additional information on what they are and how they work as well as links to the ETF section on Harrisdirect's Web site.

If a question is vague or too broad - such as "What stock should I buy?" - the system attempts to focus the user's query by presenting alternate questions. In this case, the user is presented with a link to information about Harrisdirect's advisory services and an alternate question about the type of research Harris offers.

"We wanted to give our clients an easier way to find information without hunting around," Mione says. "With [keyword] search, you've got to do a lot of hunt and peck." The new tool, he says, can help users "define what they are looking for and direct them to get new information a lot easier." And it frees up call center agents to handle clients' more-

taxing problems, he points out.

Steve Klein, CEO of Conversagent, says the technology can save firms a bundle. Conversagent estimates that a live phone conversation can cost a firm between $7 and $33 a session, while live online chat and attended e-mail runs in the $3 to $9 range. Self-service functionality, such as automated service agent technology, however, drops those costs to as little as one penny a session. "You can save a tremendous amount of money," he contends.

Mione says that the tool also can be used by call center agents to find answers to callers' questions. And call representatives can edit and add to the system to provide a tailored response to a common question.

From an IT perspective, the technology was easy to deploy, according to Mione. He points out, however, that the solution is monitored heavily during the early stages of implementation. Agents often spend half a day reviewing reports and enhancing the system, Mione relates. "Obviously, as time goes by, this is going to diminish," he notes.

Though the solution was launched in February, Mione already has seen results. Users initiate about 400 sessions a day, with an average of 2.5 questions a session, he says. And the number of sessions is rising, as is the number of repeat users.

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