My folks are visiting from Chicago. My Dad, Harry M. Peterson Jr., 86, is, among many identities, a war hero, entrepreneur, comedian, lover of the arts, author, husband, Rotarian, and all around great guy. Throughout his life, he also has been a tinkerer with new technology, being one of the early adopters of plastic bottling in the food industry (maple syrup) in the ‘60’s.

I was going through some Spring cleaning last week and came across a file of letters he had sent me over the years. For some reason, a letter from September 19, 1996 caught my eye. Twelve and a half years ago, in addressing the consolidation work I was doing for Norwest during our acquisition tear at the time, my then 73 year old father wrote the following;

“ …the fast pace leaves little time to incorporate the new before another new piece is added and so-on. There must be a structure, like a “Leggo” block system, which can be added quickly, easily and continuously. Buy, plug in computers to a huge central terminal/process center, scramble to enable instant communication, buy another and plug in ad infinitum.

You don’t need to own it if you control the flow….

The day is promised when we will all bank from our home. Only 2.5 million home computers are installed today so that’s years off.

I question the need for all the buildings that banks operate…..Not flexible enough in this fast-changing age….Rather, put up a string of franchises like McDonald’s and control all the services by wire, exact a fee and royalties for each transaction based on gross product. Each store pays for their location, invests local investor money, gets a trained manager…..from personnel displaced from all the mergers; there must be a supply of good middle managers and others floating around looking for full or part-time work.

A bank only makes profit by moving money, selling money for a fee. It will eventually be mostly a national computer bank of credits and debits.

Did McDonald’s buy all their locations? No; they offered the format, supply and service. The investor merely had to do the work.

As Ray Kroc (my Grandfather’s boyhood buddy) said to Dr. Harry Peterson (my Grandfather) in (our) kitchen that night in 1954; ‘Harry, you’ve got to get into this. It could be really big.’”

Twelve and a half years later, Plug-and-Play is a reality, banking is mostly done from home and we are on the verge of a new era in banking; the franchise. I have reached the conclusion that banking is going to go back to its community roots “where everybody knows your name.” Plug-and-play computing and franchising; put them together and you have a prescription for curing the lack of money flow and for building the new era in banking. “The investor merely (has) to do the work.”

P.S. My Grandfather didn’t make that investment.