As CIO at USAA, Greg Schwartz oversees technologies that help the company deliver financial services to its core customers: members of the military and their families. Here Schwartz talks about how mobile is redefining the business, how increased regulation has refocused IT resources, and how USAA is engaging customers through social media.
What do you prefer: paper or e-book? In my position, many people send me paper business books. I feel compelled to read them. But I prefer e-books. All of my magazine subscriptions are electronic.
What's your favorite technology? I use a remote app on the iPad to control my audio/video collection at home.
What's your favorite nonwork pastime? Boating.
Do you have a guilty pleasure? Fantasy football.
Where would you be today if you hadn't pursued an IT career? I would probably have my own retail business. I come from a family of entrepreneurs.
Have you had to reprioritize IT projects because of the economy? Not so much for the economy, but for the regulatory environment. The Financial Reform Act of 2010 put a tremendous burden on us, and we have had to reprioritize some pretty important projects in order to get those regulatory changes in place. It's been a turbulent year, and unfortunately we don't see that letting up in 2012 or 2013.
Half of USAA's IT budget goes toward implementing new technology for the future. What's on the docket in the next 12 months? I've got to do the regulatory stuff first. There's no way around that, and that's going to take more money than I want to spend. There are literally hundreds of projects lined up for 2012.
What's the biggest challenge you're facing right now? The hardest challenge is ensuring that we're working on the most important projects. We have so many great ideas, and we need to make sure we are moving as fast as we can to do as many projects as we can.
For every project I have funded for 2012, I have another that is not yet funded. The biggest challenge is to move projects faster. I look at IT project delivery as an assembly line, and that process has to be tuned and it has to perform better every single year.
What do you feel most passionate about? Mobile, because it is such a game-changer in our industry. So many barriers that used to exist from a technology standpoint have fallen.
What mobile apps has USAA been developing for its members? We're concentrating on tablets. The first iPad didn't have a camera. When the second iPad came out, we added our remote deposit capture capability, just like we have for other mobile phone devices.
Our Auto Circle and Home Circle apps are a unique way of improving the member experience around buying a home or auto. You can find a car, configure it, negotiate the price with a dealer, finance it, insure it, entirely from your mobile device. [The apps are] already on our website at AutoCircle.com and HomeCircle.com, and [they're] being rolled out as iPad apps this month.
USAA's Open Innovation Lab lets employees test ideas. What interesting things have come out of that? We got some really great ideas in the last 18 months. Our top employee ideas that were associated with cost savings have generated a 29 times return on investment in the past 12 months.
Our employees developed a social media portal that allows a team of USAA employees to interact on Facebook and Twitter through a single interface. All conversations between USAA and our members can be tracked, and we can respond from a USAA perspective. Now it's easy to tell the person the official response.
USAA has been using social media to develop online communities for its customers. What is your strategy? Our social media strategy is to meet our members where they are already engaged in social networks and seek opportunities to create custom communities for them. We're deeply involved with Facebook. The USAA fan page is the second most popular insurance page out there. We use both Facebook and Twitter to provide support, share financial news, and put things out there for our members to know about.
But we want to create subcommunities as well. A few months ago, we launched a community where military spouses can converse on any topic.
What emerging technologies do you find most promising? Anything in the electronic payment space. Chip and PIN is emerging in the U.S. and will play big in the credit card space. Of course, near-field communication, or chip in phone, will affect future electronic payments. And then there are QR [quick response] codes. It will be so much easier to use a mobile wallet than the way you pay a merchant today.
Business intelligence is another category. There is so much data available to us out there that's unstructured today. [We need] technology that helps us to manage that data, better visualize it and help with near real-time analytics so we can make sure that we present the right offer to customers for their needs at the right time.
Finally, we use speech technology in our call centers today, natural language speech recognition, and we want to see that continue to improve.
If you could rip out any IT infrastructure technology and replace it with a state-of-the-art system to make your job easier -- no strings attached -- what technology would you choose and why? The payments infrastructure. We ride on the traditional rails in the industry, so to speak, and that needs to be modernized, especially with all of the emerging capabilities in the mobile channel. I would like to see that accelerated, but we can't achieve that alone. We have to work with many suppliers.