Ameritrade, Citigroup, and MetLife expand IT execs' roles in setting strategy
Technology and operations are becoming increasingly inseparable in the financial-services industry, where companies define themselves as information-management and transaction-processing providers as well as lenders. Three recent appointments showcase the expanded role played by technology execs in setting financial-services companies' long-range business strategies--and executing on integration of their frequent acquisitions.
MetLife Inc. last week promoted its CIO, Steven Sheinheit, to executive VP, where, in addition to wearing his CIO hat, he'll oversee the company's global sourcing and the integration of the Travelers life-insurance business, which MetLife acquired from Citigroup Inc. earlier this year. Citigroup last week appointed Kevin Kessinger as head of operations and technology, one of several senior management changes made at the bank. And earlier this month, Ameritrade Holding Corp. named its CIO, Asiff Hirji, to the post of chief operating officer.
In his new job, Hirji is responsible for trading systems and back-office clearing and settlement functions--which he supported as CIO for the past three years--and also is overseeing the integration of TD Waterhouse, an online brokerage firm that Ameritrade acquired earlier this year. Financial-services companies, Hirji says, can be characterized by their degree of "technology intensity," which he defines as the proportion of operating expenses devoted to IT. For companies with high technology intensity, like Ameritrade, "it's impossible to separate the business from the technology," he says.
With the integration of TD Waterhouse under way, Hirji has assumed control of all customer-facing and operational activities. "Our No. 1 consideration is preservation and enhancement of the client experience," he says.
Another reason for handing CIOs more management responsibilities is a greater reliance on outsourcing and the use of services-oriented architectures in the industry. "The shift away from maintenance of legacy apps toward strategic use of technology has given CIOs a place at the executive table," says Tom Kraack, managing partner in the financial-services practice at Accenture. The trend is likely to become more pronounced as companies realize the need to share data between systems cutting across functional lines, such as accounting, compliance, and risk management.
Since becoming MetLife's chief technology officer in 2000, Sheinheit has overseen a $1 billion annual IT budget and is credited with building an enterprisewide architecture and common platforms for the company's businesses. Under the deal with Citigroup, MetLife will expand its distribution by making products available through Citigroup channels, including Smith Barney, Citibank branches, and Primerica. At Citigroup, Kessinger has headed operations and technology in the company's card business, where he led construction of a data warehouse and directed the integration of the AT&T Universal Card business and the company's private-label cards.
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