JPMorgan Chase’s global chief information officer tells Dan Barnes of the importance of being crisp, timely and final when it comes to technological decision making.

“In the financial services industry, competitive advantage is gained when technology is developed and maintained in a co-operative and synergistic way throughout the firm,” says Austin A Adams, global chief information officer at JPMorgan Chase. That is a good philosophy for any CIO but does it represent the state of play in the world’s second largest bank (by Tier 1 capital)?

“In the world of technology, things don’t always happen as smoothly as you wish,” he says. Having good process and client focus is critical. For a man with 20 years in the role of CIO, that is pertinent.

Decision-making skills

Mr Adams comes across as a genial realist, whose comment “I have been described as excessively driven” seems ironic when spoken in his relaxed North Carolina manner. He has stood at the crossroads many times in his career (one that has included overseeing a number of mergers), with a choice of paths that would have profound and very different consequences. It is decision making that he stresses as a skill – each choice must be crisp, timely and final.

“Crisp, because when something changes that affects IT, a developer has to know if their job will still be there as a consequence – they may be reassigned, they may move to another company, they may simply carry on as before,” he says. “Timely – your IT team have to know whether they should continue to build the system they are working on or productivity suffers significantly. If you have almost completed work on a major system, decide if you will still need it. People will be demoralised if everything they do is half-finished.

“Lastly: final. This is very important. I’ve seen situations here where discussions go on for years about whether to change a system, if so how – you cannot leave these issues open-ended, people need to know or you do not move forward.”

Change is not something to take lightly either. As he points out, there is no single decision maker in these situations. “Ninety eight per cent of the time, people like the systems they have, they don’t want to change. You need to involve the business people and you need to have a game plan.”

Outsourcing choice

The most widely discussed industry decision involving Mr Adams was the judgment in 2004 to drop JPMorgan’s $5bn outsourcing contract with IBM for managing, among other things, data centres, distributed computing and networks. What is essentially infrastructure would be considered high on the outsourcing target list for many; why not in this case?

“Our infrastructure is our business,” says Mr Adams “We’re big in the payments space and it is a scale game. That means that we compete with resilience, scale, with our hardware, with our disaster recovery.”

The industry is awash with talk of which banks will be the ‘big five’ in international payments and JPMorgan has always featured in the listing. Information technology keeps this business working and Mr Adams is aware of the challenges to staying in the game.

“Our biggest potential advantage comes from using the data that runs through our systems and ensuring that we make ourselves work for the customer,” he says. “Sometimes I worry that we miss a trick and fail to differentiate ourselves, although I’m not being arrogant when I ask: why would you bank with a small institution?”

Watch your back

His competitive streak is tempered by caution and pragmatism. When he says he is keeping an eye on the competition, he looks at more than just the usual suspects. “Am I concerned about Wal-Mart coming into the banking space? Yes. I admit, I don’t expect it to get involved in equity derivatives next week but for retail banking it’s a scale game and Wal-Mart has that.”

When deciding how to tackle the competition, established or new, Mr Adams gives the impression that his choices will keep JPMorgan Chase in the running for a long time to come.

CAREER HISTORY:

2004: Corporate CIO at JPMorgan Chase

2001: Executive vice-president and CIO at Bank One

1985: CIO at First Union Corporation (now Wachovia Corp)

1973: Northwestern Financial Corporation

Austin Adams holds a bachelor’s degree in business administration and an MBA from Appalachian State University

He is a member of the Research Board and the CIO Strategy Exchange, and serves on the board of the Bank Administration Institute

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