by Peter High, published on Forbes
Vanguard is an investment management company with more than $3 trillion in assets. It is the largest provider of mutual funds in the world. It is a company that believes in developing breadth and depth in its leaders, and as such, potential executives are likely to do “tours of duty” of sorts in multiple parts of the enterprise in order to get a better sense of all that the company does for individual and institutional investors. IT is no different. In fact, multiple executives outside of IT once held the chief information officer role.
The incumbent, John Marcante, has been the CIO since 2012. As someone who has held leadership roles outside of IT during his 22 years with the company, he thinks about IT in some non-traditional ways. He believes that CIOs have to have technology acumen as a foundation, but that they also need to have business acumen. There is no replacement for having spent time in the business and for interacting with customers. Lastly, he says that CIOs need to build a leadership competency centered on the ability to influence the leadership team through strong analysis and clear communications. He believes that these three competencies need to be shared by leaders of other functions, including the need to be technology savvy, as technology becomes more pervasive in all industries.
In this interview, Marcante describes his own career journey, the way in which he thinks about the value that IT can create, the ways in which he benchmarks start-ups for new ideas and methods, the methods he has used to gain insights from customers, the methods he uses in ensuring that his IT staff (who are also customers of Vanguard) leverage their insights as customers to make IT better, and a variety of other topics.
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Peter High: You are the Chief Information Officer of Vanguard, and in that role you oversee technology to serve clients and manage investments. Can you take a moment to talk about how you work with your colleagues and customers to develop ideas in both of those categories?
John Marcante: The answer to that varies a little bit by business line at Vanguard. We have a long history of getting technology ideas from our Institutional clients – most of the clients that we manage 401(k) plans for, for example. If I remember correctly, in the early ‘90s, the idea for the creation of our first website came from a prospective Institutional client. Today, our tech clients, especially in the Institutional area, like to partner with us on the technology front. This allows us to gain their input, leading to things like custom analytics and data visualization tools. As an example, we just rolled out a new plan manager (My Plan Manager) for our Institutional customers. Getting that feedback, understanding what plan sponsors really want to see, and bringing technology to the forefront is a partnership with our clients. It is a lot less of a service provider mentality. I think the dynamics of the world are changing. It is much more of a true partnership.
On the Retail side, we have millions of clients, so it is more difficult to partner. I think, traditionally, we used to use focus groups, where we could get people in, track eyeballs, create heat maps for our websites, and even solicit feedback from clients by creating virtual labs and having early adopters join those labs to look at their own data. Today, it is much different, with the introduction of big data and the introduction of “continuous delivery.” Today, technology allows our business to have a hypothesis, create a test, experiment with multiple clients seeing multiple experiences, and quickly implement one of those experiences that produces the best business outcome or client experience. Today with data analytics and continuous delivery, we can test, fail, fail fast, fail cheap, learn, and iterate to the best design. That is where we are at on the retail side.
High: What traits do you believe CIOs need in order to be successful today?