Joe McClure, executive vice president and CIO of AmeriCredit Corp., was recently named one of the 2001-2002 top financial IT executives by The CIO Forum – Financial Services. AmeriCredit, headquartered in Forth Worth, Texas, is the largest independent middle-market auto finance company in North America. McClure was one of 22 IT executives recognized among hundreds of people nominated by their peers for this inaugural award. Honorees were chosen based on their creativity, commitment to the industry and results achieved. The awards will be given at the organization’s financial services conference this month in New York City.
McClure has served as executive vice president and CIO of AmeriCredit since 1999, after joining the company as senior vice president and CIO in 1998. He was previously executive vice president and division information officer of Associates First Capital Corp. In this interview with Esther Shein, he discusses the challenges of keeping up with rapid growth and being innovative.
Q: Why do you think you were named one of the top financial IT executives by The CIO Forum – Financial Services for 2001-2002?
Joe McClure : I have not received a description of why I received the award [however] … If I was to speculate on the reason for the nomination, it could have been from two perspectives: changes and improvements we’ve made internally for the company and other things we’ve done that are more externally oriented. To support that growth in the last three and a half years, we’ve done an extensive job of building a technology infrastructure. There used to be 65 people on staff and today there are over 250 in technology.
Some of the infrastructure changes we’ve made are bringing up five major sites: four call centers and our new corporate headquarters in Forth Worth. And the call centers support our collection activities and our customer service. Some other things in the infrastructure: everyone’s got a PC on their desk, and we’ve done a lot on our intranet and corporate portal; we’ve expanded applications to automate areas that were manually intensive, and one thing we’ve done that’s been very successful is align our IT infrastructure to match the business. We have applications to match each business unit – the dealer area, the consumer area, our e-business area and our various corporate support areas, so they have direct support staff to meet their requirements.
We call our corporate portal or intranet, AmeriNet. Every morning when employees come in they log onto their computer and see AmeriNet. We do all our time tracking for our non-exempt people who log in and out online, to track hours. We use this extensively for company news, and it’s updated daily. Every department has their own page. We use it for computer based training, the phone directory, and we do extensive imaging of our loan documentation–we image around 50,000 documents per day. What [people in loan processing and loan servicing] are able to see online is the application, title, contract, and insurance information. Dealers come in [to the portal] in multiple ways but the documentation is generally faxed or imaged in. AmeriNet is used for extensive viewing of management reporting and we use Cognos [as the reporting vehicle for the data warehouse] to do queries and have information displayed in a cube, and you can drill down to view that information. [The portal provides] employee self serve: employee benefits, stock purchase, expense reporting are all done online. Management self-serve salary administration is done online too [as well as] approving the hiring of people.
One of things we’ve implemented is a complete ERP system that automates the HR and Finance areas. We’re using Oracle on an IBM RS/6000. We did that two and a half years ago. As a corporation we have about 4.3 terabytes of data that we use to provide information to the data warehouse.
From an external standpoint, we’ve built an electronic business channel that supports the business. How this works is, we sit behind e-loan and Lending Tree, our two partners, and the applications they receive are forwarded to us on the Web and automatically we decision those applications in 30 seconds. We built this using reusable components so we could easily add new partners and use these same components [so an individual could] submit a loan directly to us. Our core model is an indirect model where we have sales people who buy contracts from the dealership and e-business and direct lending is how we directly interface with an individual consumer. About 5% of people do the direct model and apply on our site. We also do electronic documentation, which means if you’re a consumer you apply through e-loan or Lending Tree or AmeriCredit and print out the loan and bring it with you.
Another major effort we have is the development of capabilities called “DealerTrack.” This is an application built in concert with Chase, Wells Fargo and AmeriCredit. This is an online Web-based application system that allows dealer to submit an application to multiple lenders at same time. The dealer only has to enter the application once to anyone financing through DealerTrack. This was implemented one and a half years ago. The dealer doesn’t have to pay to use it. We also support automated decisioning, where you get an automatic decision extremely fast.
Q: AmeriCredit’s CEO says you have applied technological innovation and “state of the art data management capabilities.” Can you elaborate?
AmeriCredit is viewed by employees as a very unique corporation. It’s very employee oriented. A couple of years ago as we were growing we realized we wanted to preserve what we thought was a unique culture of integrity, investment, innovation and information. When those four are brought together it’s called I 4th power. Many of things I’ve talked about on the external and internal side are the keys of innovation and investment we make in technology and in our facility and the information we provide internally and to our customers.
In terms of people development, particularly in the IT organization … When you become a manager you go through a defined management training program. We’ve developed career paths to show how you can go from where you are to somewhere else and that career plan is updated yearly. There’s a mandatory program of a minimum 60 hours of training annually, and 40 of those are to expand on current skills and 20 hours can be spent on developing new skills for other career options in IT. Wherever possible we also support a whole series of flexible hours whether you come in early or late or work four-day weeks … there are a lot of different options. We’re very focused on providing opportunities for our employees and training and a work schedule that meets their requirements. Those are all programs we’ve implemented in IT and as result we have about a 3% turnover rate. We have a lot of focus on community involvement as well.
Q: What have you done in terms of beefing up system security since 9/11?
The security area does not report to me. We spun it off before 9/11 to report to the CFO. That gives it separation from IT and the business areas. That’s where our internal auditing group is. Prior to 9/11 because of various viruses coming out we’d done extensive work with firewalls.
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Q: How has the economic downturn affect the pace of technological change and change management in IT?
It has not slowed it at all. We have a very robust plan coming into this year and some large projects that have been added to it. For example, the customer relationship management piece of Oracle. [Recently] we brought up the sales force automation component of CRM. The whole concept of SFA is to allow the capture of information of dealer customers so the sales force is in the process of entering that information. Over the long term we’ll be able to track information on dealers so we won’t lose that when sales people are promoted or move to other companies. We have not reduced our IT investments at all.
Q: What’s your view on implementation of new technologies and bleeding edge versus a more conservative approach?
We certainly experiment with leading edge technologies. For example right now we have some wireless applications we’re testing with some of our remote sales force. That’s to understand how effective that technology will be. We have a tendency to be more mainstream. We’ve chosen Oracle for ERP and we’re very much a Microsoft shop so we have a tendency to go with market-type players.
Q: How large is your IT department and what skills are you in most need of right now?
We have 250 people. Right now we’re finding it to be a very attractive marketplace. For the most part there is no skill set we’re in short supply of or that is not readily available in the market. Eighteen months ago, when the dot com thing was going fast and furious, it was a different story, but today we’re seeing some of the best candidates we’ve ever seen. We continue to hire. The fiscal year ends at the end of June and we will add around 20 to 25 [IT] people in the next year so we continue to grow that staff.
Q: How do you approach the software/vendor selection process?
The way we drive our major application changes are they are owned by the business. To do a large application the business has to define a full-time project manager who owns the project and defines that project. They need to document the requirements. We use that information in an RFP format and we use results from the RFP to select a vendor. That’s what we did with Oracle in the ERP selection. We also looked at Siebel, PeopleSoft and SAP for the ERP system [which] was implemented two and a half years ago – it one of first major applications we did when I came in.
Q: What are the ingredients of a good vendor relationship?
Certainly it’s an application suite that meets the core requirements you have. Service to meet the changes and problems you may run into, and then competitive pricing.
Continued…
On Page 2, read what else occupies McClure’s time — and what keeps this CIO awake at night.