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Technology is Disposable!
Karthik Sundaram
Thursday, January 30, 2003
WHEN HEWLETT-PACKARD INTRODUCED THE Compaq tablet-PCs, we took up 10 pieces to experiment with. The IT team held on to only three, while the rest of the seven were given away to other departments. This is how IT at General Motors Acceptance Corporation (GMAC) works—by collaboration. Typically, the IT team in another company would have held on to all the 10 samples, till it feels that it has perfected the technology, by which time the other departments would have moved on. But the team here works in synch with the other departments—delivering solutions that are perfected by the users themselves.” says Niraj Patel, executive vice president and CIO of General Motors’ mortgage division, GMAC Commercial Mortgage (GMACCM).

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. In his present role as CIO, Patel oversees a staff of more than 200 and guides the corporation’s worldwide activities in application development, infrastructure, telecommunications, and business unit support.

Among Patel’s many accomplishments are developing the first investor reporting Web site in the commercial mortgage industry, Investor Query (IQ), and serving as a founding member in charge of technology for MortgageRamp.com, the revolutionary online solution for financing commercial real estate loans via the Web. Mortgage approvals on commercial properties can take 90 to 120 days, hardly the zippy process one encounters in the residential market. In January 2000, GMACCM created an on-line subsidiary, MortgageRamp, to change all that. The company even handled the start-up in a vastly new way. First, they decided it would go live in 90 days —less time than it takes to process the average commercial mortgage. It then assigned three people to build the entire company, including the technology. And to turn the heat on even higher, the company took out full-page ads in the Wall Street Journal announcing the date MortgageRamp would launch.

Patel went scounting for help. “Only Microsoft, Compaq, Cisco and Intel were willing to step up to the plate,” recalls Patel. “We started building the company in January, and then we launched the MortgageRamp site at the end of March,” says the CIO. “That’s right, just three of us built an entire company —not just the technology—in three months.”

Other worldwide breakthrough accomplishments include implementing the first Frame Relay Wide Area Network (WAN), the first production 1000 Gigabyte network, the first 100 Megabyte Ethernet, and the first production version of Windows ‘95. Most recently, Patel has been instrumental in expanding the international presence of GMAC Commercial Mortgage Corporation, providing leadership for the cutting edge technological infrastructure needed for branch offices in Ireland, Japan, France and Canada.

“Technology is disposable,” says Patel. “In my efforts to make the company truly appreciate the value of technology, I have delivered a lot of smaller wins and continually shown 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.” In an industry that's incredibly paper-intensive, GMAC has been successful 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. The imaging solution that Patel and his team established enterprise-wide has been regarded as an industry revolution. 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.

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.

“We want to automate resource-intensive processes, increase the availability of applications and dynamically scale to meet the demands,” says Patel, who has worked with the biggest of the software firms, to develop key technologies with them. “Microsoft will tell you that we are one of those companies that pushes them constantly,” laughs Patel. “And again, we are not afraid to throw technology out if it doesn’t help our business.” A case in point was their call-center automation software that was built after extensive customer calls studies. With in-built recognition tools, and many automation features, the CRM platform went live, and Patel and his team found customers hitting the zero button to speak with a live “voice.” GMACCM today has a well-manned call center to handle the scenario.

“The culture at GMACCM is one of early adoption. Technology is not restricted to the top management alone. Even our sales team on the roads are imbued with this culture. There is constant feedback about how our systems are working, or what the team notices new in other locations,” says Patel. “This is a wonderful culture where everybody understands that technology can help them work better, deliver quality value to the customer, and help us gain a cutting edge in the market. There is no technology for technology’s sake,” declares the CIO.

“Commercial mortgages are totally different from the residential mortgage business. There is no recourse in the commerical mortgage business. The value of the business will typically run into the millions, and we can’t have a system that fails to handle the intricacies in each of these deals,” says Patel. “There is a great amount of customer information that drives our business. This has to be on instant recall and sharing model, and the technology has to be stable to handle all this. We have to introduce technology at a time when the company can digest it.”

This unwavering focus on cutomers and business processes have helped Patel build his company’s IT strengthen the very process advantages. “The technology is the easy part. It is how people can use it, and how pervasive it can become within the company that decides a technology’s fate.” With a $42 million IT budget, Patel always ensures that his spend fetches the best in returns. “I believe that if a project’s ROI cannot be worked out on the back of a paper napkin, the project is doomed. The transparency in the technology has to be that clear, and simple,” declares Patel. The early-adoption culture has helped Patel work directly with the software builder, and GMACCM’s record in co-authoring tools is enviable. “Our competition uses what we build,” says a proud Patel. Technology is everywhere in GMACCM, thanks to Patel’s untiring efforts in exhibiting product advantages at every stage. As a new company that began in 1995, GMACCM has been fortunate in that it has not be loaded with a stack of legacy systems to contend with. “We began the BPO process long before it had become a big catch word,” says Patel. “Today, we can do any process at any of our offices at any time. This is the maturity of our BPO exercise.”

“The CIO has to constantly keep an eye on the operational efficiency in the systems, and if this does not happen, the business value is lost,” advises Patel.

“Technologies need to let go of their products. If they cannot do that, the technology is only stagnating. They need to step back and see the business map in its entirety, and then see if their technology is in synch with the business strategy,” says Patel. The GMACCM CIO plans to work on third party information and business processes, so that they work in tandem with the GMAC system. “This gives them added tremendous value,” says Patel.

“This job is fun,” laughs Patel. “I sometimes wonder if I am getting paid only to have fun with all these wonderful technologies.”

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