The Five-Year PlanBy CIOinsight
Hill: Banks evolved so that the retail side was the fourth-class citizen, and the technology side drove the retail side. The branches delivered whatever the back office gave 'em. But our focus was always at the delivery point. We designed everything backwards from there. We said, "This is the solution we want at the retail end; how do we build the back-end to get there?" [Chief Retail Officer] Dennis DiFlorio, who's been here for 15 years, was always in charge of both operations and retail. That's very unusual in a bank: They are two different worlds and they're always fighting with each other.
What led you to design it that way?
We asked, what do you need to be successful at the store--not what's the cheapest or most convenient for the IT people. Everything we do has that philosophy built in: How do we deliver a better customer experience?
You've got two models in the banking business: You've got the "build" model, which is us, and you've got the "merge" model. When you're merging, you've got multiple systems, you've got a million things to deal with. Also, the banking business for the last 15 or 20 years has been a slow-to-no-growth business. When you're always cutting costs, you're always underinvesting, you're always doing mergers to cut more costs. To stay ahead of the IT curve, you've got to think about where you're going to be four years from now, and you've got to overinvest.
What do you look for from your CIO?
An information officer for us first of all has to buy into these concepts I'm giving you. These guys could simply be empire builders who care about programmers and all that stuff, so the first thing we do is hire people who buy into our philosophy.
As you've gotten bigger, how have things changed?
When we were smaller, we could do things quicker, because we had fewer parts that have to interface. Now when they put in a new teller system, they've got to run tests on it to look at all the interfaces, that kind of stuff. Wal-Mart has taught us that size can be a value if you always enhance the customer experience. What Wal-Mart has learned is to take their buying power, beat down their vendors and pass the savings on to their customers. Customers see Wal-Mart's size as a definite advantage for them. We have to do the same thing for our bank customers: We have to make the experience better, we have to reduce the cost to the customer, we have to have more geographic coverage, we have to make it better. If you're just getting big to be big, what the hell does the customer care about that?
Do you think you can do what you do, systems-wise, on a national level?
Sure, and we're going to do it. Our five-year plan is to reach $115 billion in assets, which would make us one of the top ten banks in America, just doing what we're doing now. But it comes down to how we make the customer experience better. If we don't do that, we don't have a reason to be around.
1973--founded Commerce Bank, now Commerce Bancorp Inc.
Site Development Inc.
1968--Founded Site Development Inc., a real-estate development firm
1967--MS, Wharton School, University of Pennsylvania