USAA CIO Greg Schwartz

USAA's innovation is driven in part by having to meet the unique needs of its customers--U.S. military personnel, often deployed around the world. USAA provides insurance and banking but has no branches, relying on the Web and mail. USAA CIO Greg Schwartz spoke with Anthony O'Donnell, executive editor of Insurance & Technology, a sister publication of InformationWeek, on the innovation that made USAA the top insurer in this year's InformationWeek 500.

On Deposit@Mobile, the first app to let people deposit checks by taking a picture with a smartphone:

Schwartz: Deposit@Mobile really came from the Deposit@Home technology that we rolled out in 2006. Both are trying to solve the same problem: ... How would folks deployed all over the world be able to use something other than mail to deposit their checks and get instant access to their funds? Deposit@Home took advantage of a home scanner.

... As mobile technology evolved and the camera technology matured on phones, one of our researchers came up with the idea that "Wouldn't it be great for our membership if we could develop the same kind of capability that they now have in their homes on their mobile devices?" We put a couple of very talented folks together, and they came up with this innovation. It has revolutionized the industry.

On the business case for Deposit@Mobile:

Schwartz: There's no doubt that when we talk about ROI, we're looking at it through our members' perspective. We aim to make doing business easier for them, and Deposit@Mobile has clearly broken down barriers for members who were reluctant to do branchless banking. So we know that it has contributed greatly to getting new members on board, and we're getting an ROI from that standpoint.

With most projects, we look for a payback in three years or less. I can tell you that if you have increased membership, if you have simplified the back office, if you have empowered and delivered a better service to your customer base, you will get ROI. We've also eliminated a big portion of mail.

On spurring innovation:

Schwartz: We rolled out an innovation tool earlier this year that allows all of our employees to import their most innovative ideas into it. They can comment on other people's ideas, they can vote those ideas to the top or vote them down, and this gives the technical community the ability to mine those ideas and implement them where it makes sense.

... That said, a lot of things need to happen to make innovation work. You have to do something with those ideas. We allocate a separate portion of our budget for breakthrough ideas. We hold those funds apart from our main project work in order to concentrate on these "game-changer" ideas.

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We have an applied research lab that allows us to do that very easily, that allows our creative employees--some in IT, some on the business side--to collaborate, to create these breakthrough ideas. ... It has a separate network that allows us to keep it separate from our production network so that we can be innovative and do things differently than what you might have to do on the production side of the house. We think it's a critical enabler of innovation.

On what's next:

Schwartz: [Deposit@Mobile] is a critical piece of infrastructure for us. It gives us the ability to move not only checks but any image or document that we would consider using in the future. So we think it's a piece of our infrastructure that we will continue to grow and get more robust going forward.