Strategic CIO // Team Building & Staffing
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9/7/2012
10:43 AM
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General Motors Picks Austin For 500-Job Tech Center

GM CIO Randy Mott pushes ahead with plans to slash the carmaker's use of outsourcing.

General Motors has opened an IT innovation center in Austin, Texas, that will hire up to 500 software developers, project managers, database experts, and other IT pros. The center is a major step in GM's IT overhaul under new CIO Randy Mott, under which the automaker is hiring employees to do technology work and moving away from outsourcers such as Hewlett-Packard and IBM.

GM plans to have four of these IT development centers in the U.S. One will be located in the Detroit area; the other locations have not yet been identified. Mott said the centers' locations would be chosen based on the quality of talent they'll be able to attract, including their proximity to universities.

GM has relied on outsourcers for about 90% of its IT work, from developing software to operating data centers. Mott, who was named GM CIO in February, intends to reverse that percentage, bringing 90% of the company's IT work in-house, using outsourcers for just 10%. It's a high-risk strategy change that will mean hiring thousands of tech pros and building a new culture of IT innovation and collaboration with the rest of GM.

[ For analysis of GM's IT strategy read General Motors Will Slash Outsourcing In IT Overhaul. ]

Mott maintains that IT staffers will have a better understanding of the automotive business than outsourcers do, and will thus come up with more creative ways to use technology. And he thinks employees can deliver more quickly than outsourcers.

Mott has close ties to the Austin area, where he has worked since he joined Dell as CIO in 2000. While Mott was later CIO at Hewlett-Packard, he remained in Austin as the company built two of its six global data centers in the area (the other four are in Atlanta and Houston).

GM already has about 4,500 employees in Texas. About 1,800 work in GM Financial offices, and about 2,500 work at the Arlington assembly plant building Chevrolet, GMC, and Cadillac SUVs. GM plans to add a third shift to that plant in the first quarter of 2013. GM has two call centers in Texas, and it's building a $200 million stamping plant in the state that will employ about 180 people.

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Polaris Silvertree
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Polaris Silvertree,
User Rank: Apprentice
9/10/2012 | 12:41:47 AM
re: General Motors Picks Austin For 500-Job Tech Center
I think there's more to this than meets the eye. First, I heard that Mott was unimpressive at HP when he was the CIO and quite honestly I heard the problems that were impacting the company's productivity were due to his lack of responsiveness and general leadership. From what I could gather, it was no surprise he had to leave HP.... I can't help but think this is part out of spite than anything else. The writer is right -- its very high-risk to all of sudden switch gears like this -- especially as fragile as the US auto industry has become. The disruption is enough to erase margins, IMHO. That said, I agree somethings probably make sense in bringing back in-house. But the way this is being done -- its a bit too sudden and global to be honest to make total sense. And from what I understand, TODAY HP Enterprise Services (former EDS) still does do quite a bit of work for GM today (but nothing like how it use to be). The comment about IT Outsourcing going to other countries I think is a bit misleading -- its not like IT contractors are all based in India. My friends in Michigan and Italy still support GM today. That was a GM thing. GM has an international presence... and with that comes international IT support.
Andrew Hornback
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Andrew Hornback,
User Rank: Apprentice
9/8/2012 | 8:16:02 PM
re: General Motors Picks Austin For 500-Job Tech Center
With regards to the choice of Austin for GM's technical center, I think that we could all see that coming, considering Mott's links to Dell.

Also, I wouldn't be surprised to find out that GM is going to be leaning on Dell as a supplier of cloud-based systems, commodity-level hardware and infrastructure consulting/management.

Somehow, it all just makes sense... if you no longer want IBM or HP involved in your operations, hire away the CIO from Dell.

I'd also be willing to wager that one of the other technical centers will be around Nashville.

Andrew Hornback
InformationWeek Contributor
Andrew Hornback
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Andrew Hornback,
User Rank: Apprentice
9/8/2012 | 8:12:26 PM
re: General Motors Picks Austin For 500-Job Tech Center
Not that it's very tech related, but when shopping for a vehicle, always look at the first digit in the VIN number to determine the country of origin of the vehicle. There are plenty of resources that can help you decode it - but generally a 1 means that a vehicle was built in the US, 2 means Canada, 3 means Mexico... when you get overseas, things start to change.

Something else to realize, vehicle content doesn't always equate to where it was manufactured. For example, it's possible to buy a Dodge build in Canada (2 in the VIN) but have the engine built in the US and the transmission built in Germany.

Andrew Hornback
InformationWeek Contributor
ChrisMurphy
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ChrisMurphy,
User Rank: Author
9/8/2012 | 4:36:23 AM
re: General Motors Picks Austin For 500-Job Tech Center
You're correct. That's corrected.
cchranko6061
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cchranko6061,
User Rank: Apprentice
9/7/2012 | 8:01:30 PM
re: General Motors Picks Austin For 500-Job Tech Center
Nice fact checking! EDS has not been been used since HP changed it to HP Enterprise Services in 2009: "The center is a major step in GM's IT overhaul under new CIO Randy Mott, under which the automaker is hiring employees to do technology work and moving away from outsourcers such as EDS and IBM."
phenry017
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phenry017,
User Rank: Apprentice
9/7/2012 | 6:40:59 PM
re: General Motors Picks Austin For 500-Job Tech Center
I used to buy only GM vehicles until I learned a couple of years ago that they outsourced all their IT work. It enraged me that they were asking people to "buy American" while they were sending all the IT work overseas. Now I might have to look into their vehicles after this announcement.
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