A lot has happened during the last 12 months. The New Economy, to which everyone looked for leadership and direction in 2000, quickly became the "old" economy. A new president was finally elected, and businesses were looking forward to some level of stability. Then came Sept. 11.
These changing times have put a lot of new pressure on CIOs. Some have been able to handle it without missing a beat. Others haven't. I recently met with one CIO who not only managed that pressure but also significantly enhanced his company's ability to succeed in a fiercely competitive environment. Niraj Patel, CIO and executive VP of GMAC Commercial Mortgage Corp., has done so well because of his innovation, hard work, and most important, I think, his close working relationship with his company's business units.
Since General Motors created GMAC as a separate business unit in November 1995, the company has grown from a 54-person U.S. operation to a 2,400-person global enterprise that services a commercial real-estate portfolio worth more than $125 billion. Patel took over the CIO position of this startup in 1996 and hasn't looked back.
Patel and his IT group have been able to build a solid business foundation for technology throughout GMAC's expanding business units. Building that type of relationship is easier said than done, so I was extremely interested in how he was able to get the business side of GMAC to appreciate the importance of technology. Patel told me he delivers "a lot of smaller wins and continually shows the business units the benefits and value of those wins to their operations. I don't believe in one big project or silver bullet; you have to build on a series of wins. It's like Lego blocks."
I certainly understood his message. As CIO of the commonwealth of Pennsylvania, I followed a similar approach. We both agreed that too many CIOs try to solve all their problems with that one silver bullet, an approach that seldom works.
We spent a lot of time talking about the paperless initiatives that GMAC completed last year. In an industry that's incredibly paper-intensive, it's amazing how successful GMAC has been in implementing a companywide paperless program.
Each of GMAC's deals might have a final loan agreement that consists of a stack of paper more than a foot high. For an expanding global company with more than 50 offices worldwide, managing the creation, production, and movement of all the documents needed for each agreement was an increasing challenge. Patel said that from the beginning, he and his group "worked closely with each of the business units and key technology partners" to develop a new networked solution that scans every document and makes them available online within four hours.
It's a great technology story, but what I found exciting was how Patel and his group have been able to have a real impact on their business operations. With two loan-processing facilities, one in the Philadelphia area and the other in Dublin, Ireland, GMAC can start processing a loan in Philadelphia and, at the end of the day, electronically transfer it to the Dublin facility, which picks up where they left off. Talk about leveraging global business resources.
The fact that GMAC's president understands that technology can help create business solutions and has made it a clear priority throughout the company is also a major help. "He even checks the amount of paper the units are still buying, making sure everyone's committed," Patel says.
During the last 12 months, Patel and his team also implemented a few more wins. GMAC became a Microsoft Joint Development Partner on Windows XP, activating more than 700 users by XP's launch last October. GMAC also became an ASP for other companies in the commercial mortgage industry and has integrated a number of business acquisitions with what he terms "blazing speed."
Looking at the successful CIOs that I've met over the years, there's been one consistent approach in how they've become key strategic members of their companies. The common thread has been their commitment to make the business side of their companies their top priority. Patel is a great example of how CIOs must understand that the strategic value of technology is as a business tool and the importance of their own role is working closely with their business units.
We've all said it before, but it's important to stress it again at the beginning of this new year: Success isn't about the technology--it's about how the technology can build the business tools that are increasingly critical for operating successfully in a competitive world.
Larry A. Olson, the former CIO of the commonwealth of Pennsylvania, is a principal at aligne Inc., a strategic technology-management practice and a Safeguard Scientifics company. You can write to him at [email protected].