Today’s business world is all about gaining a competitive advantage. When companies like Wal Mart strive to create economies of scale, or firms like Bank of America or JPMorgan Chase perform merger after merger, the firms are trying to inch ahead of the competition and line their pockets with gold and silver. But creating economies of scale and scope or having a merger is the big picture. Businesses of today have foot soldiers performing everyday to achieve these goals, and these foot soldiers go largely unnoticed.
The groundwork is really done by the IT department at many firms. In the Wall Street Journal article “Mining for Gold,” Sean Kelley, CIO of Deutsche Asset Management (a division of Deutsche Bank AG), was interviewed about the role technology plays the business. Kelley offered insight upon insight about the workings of information technology at Deutsche Asset Management, raising the ideas of diversification of research, data mining techniques, technological innovation, in sourcing and outsourcing.
“We make it our business to understand next-generation technology. How, for example, do you sift through the information on the Web and bring it back in a way that someone can work with? [Maybe we'll use] graphical models and heat maps and geography maps and other visualization techniques. Rather than be a chief information officer, I have to take that hat off and become a chief ideas officer and ask, "How can we get an advantage with this?" And it makes the job that much more interesting.”[1] Kelley fuses the ideas that his legwork as an Chief Idea Officer and his new age research style will lead to a comparative advantage in the industry.
Kelley follows the technology within his industry, but also outside of the industry as well. Programs like iTunes offer a kind of interface that is so simple and people friendly, and that could bring a lot to the corporate table.
Kelley is on the right track with his technology theories. He is guiding the company in the right direction by always looking at next generation technology, because if you aren’t on the leading edge, you will fall behind. Deutsche Bank is a very successful company, and in no small part because of its technology policies. Data mining is used to find out what clients want, and can be used to judge the market environment.
It seems that Kelley has read The World is Flat by Thomas Friedman because he is cognizant of many of the ideas that Friedman believes in so strongly. Outsourcing can get things done better and cheaper. The steroid factors, like Voice over IP allow instant communications, even video communications, in seconds, from manager to manager.
Even now, with a floundering market, Kelley sees the opportunity to gain a competitive advantage. With all of the research that the IT department can do, he sees the current financial crisis as an opportunity for Deutsche Bank to grow in market share.
Cock-eyed optimist? Technology Revolutionist? No. I don’t think he is either of these. I think he is a realist. He is doing with technology what every firm should be doing. Technology gives to those who embrace it the advantage to become more successful.
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