Fraction Stations

By Huw Thomas, Editor

Fifth Third Bancorp’s new CIO Joe Robinson tells FST editor Huw Thomas how the bank is focusing on its technology in response to difficult market conditions.

When Joe Robinson stepped into the role of CIO at Fifth Third in May of 2008, he knew that he was taking on a major challenge. The true extent of the credit crunch was revealing itself day by day, and no one really knew who the next victim of a major loss or writedown might be. With the recent collapse of Lehmann Brothers, it is a situation that continues to this day. While Robinson acknowledges these concerns, his long experience, both of business and technology, means he isn’t getting too rattled. “It has been challenging coming into the CIO role, especially when the industry is under so much pressure,” he tells us when we speak to him at the bank’s offices in Cincinnati “But from my background and the things that I’ve seen, all industries go through cycles. I’ve seen these cycles come and go on the manufacturing side, and it just so happens that today we’re in a down cycle in the banking industry.”

Robinson’s pre-Fifth Third resume includes a long stint at General Electric, where he worked across several business lines. He’s certainly seen his fair share of market turmoil across a number of sectors. A lifetime believer in the power of technology, he’s now relishing some the challenges he’s facing as the organization’s top IT operative. “ It has been extremely exciting coming into the CIO role at this point in time, he says. “There really is no better place for me to be right now. It’s a great role. The organization information technology is essential. It’s the engine that really drives the company so it’s an exciting role to be in and we’re central to moving some of our key Bancorp strategies forward.” These key strategies include delivering on brand promise, improving customer experience, driving productivity and helping the company growing through new products and geographic expansion. In each of these areas IT is an integral component.

For technology to achieve these lofty ambitions requires some hefty buy in from the bank’s management. Robinson confirms that Fifth Third’s leadership is uncommonly engaged and supportive of the work he does. “The members of our senior management team are absolutely huge supporters of information technology,” he says. “They understand the importance of technology and they embrace their roles as champions of the IT agenda. That makes it very exciting for me also.”

If asked, many banks would no doubt espouse similar principles. But we live in the kind of times that can put such rhetoric to the test. As more and more attention is focused on tightening budgets and making quick improvements to the bottom line, investment in IT can get squeezed out. But Robinson is firm that’s not going to happen at Fifth Third. “I think we have a very strong approach to our technology investments and how we decide on what investments to make, and that process hasn’t changed,” he says. “We’re well connected to our business partners. We have very strong relationships. We have a good discipline in translating our Bancorp strategies and the things that the lines of businesses need to do into the right IT initiatives. Of course the credit crunch has factored into that decision process. We do have what I would consider a pretty flexible process that allows us to look at project spending throughout the year and approve different projects based on the current day situation.” Robinson gives the example of some projects in the collections area which were accelerated in response to business needs. After careful evaluation of the business situation it was decided there was case for acceleration. So that’s precisely what was done. Robinson asserts that this process is followed as a matter of course. “Business factors have come into play but the crunch really hasn’t changed our approach,” he says.

In fact, Robinson explains that Fifth Third’s attitude to technology has been on an upward swing since he joined the company. “I’ve been at the bank for about four and a half years and I would say that it’s always been good and every year it gets better,” he states. “Right now I am just tickled to be in this role with the support I have of the leaders around me. How we make decisions is just one aspect of that. You also see it very much in how we execute and how we implement. I think we implement very effectively and I think we derive the value that we’re seeking in the projects that we decide to pursue.”

Robinson’s enthusiasm for his new role is infectious, particularly at a time when so many are mired in gloom. This positivity springs in part from his experiences before he moved into the financial services space. “There’s no question about it, it is much more enjoyable here,” he says. “It’s a better approach on the financial services side than on the manufacturing side. Most manufacturers look at IT as a necessary evil. When the downturn occurs, the IT organization tends to be and its projects tend to be an area for cutting.”

If you’re working in IT in a financial organization at the moment, such a statement might provoke disbelief or jealousy, but it is something that Robinson clearly believes. “Manufacturing doesn’t have the same reliance on IT as the financial services industry, so it is a much better place to be as an IT professional,” he continues.

Opportunity knocks

In a period when so many of the country’s biggest banks are experiencing such huge blows to both reputations and bottom lines, it might be expected that possibilities for more agile institutions to step in and take advantage. “I absolutely believe that there’s opportunity out there,” Robinson confirms. “Based on Fifth Third’s previously announced capital actions we believe we are well positioned for the future.” The figures back up this assertion. At the end of the second quarter the bank’s tier one capital ratio was 8.51%, in line with a target range of eight to nine percent. Fifth Third’s processing solutions business revenue is also up 15% year over year, while corporate banking revenue is up 26%.

“We feel pretty good about our operating performance during these difficult times,” Robinson continues. “As we look at what we’re working on and what we’re doing from a strategic standpoint we feel extremely excited and hopeful about the future as we look at the things we’re doing and where we’re bringing the bank. This is really the opportunity to continue to do the right things and continue to improve our operating performance. When the cycle comes back we would like to be out in front of that.”

Prior to stepping into the CIO role, Robinson worked both in central operations and later oversaw the CRM strategy at the bank. As with all his previous positions, the knowledge he gained has proved extremely valuable in his current job. He explains that the concentration on customer focus has proved an essential factor and that his work in central operations gave him some vital leadership experience. “It gave me the opportunity to really lead a tremendous number of people, he says. “We had 3000 associates in our central operations division all working the company’s back office processing every day. It gave me the opportunity to work more closely with our business leaders, learn more about the banking industry, and really craft a broad strategic agenda that was in line with the Bankcorp agenda.” This centered around focusing on our customer experiences, driving down inefficiencies and enabling the bank’s business partners to grow. “The CRM initiative and these other assignments have really shaped my thoughts as I take on the CIO position,” Robinson concludes.

The theme of leadership is increasingly central to the CIO as IT becomes ever more intertwined with every aspect of business. For Robinson, effectively managing people is just as important as managing technology. “I believe that the CIO role is very much a leadership role,” he says. “If you look at the banking industry and really reflect on how important information technology is, the CIO has to be a leader in the organization. It’s very important that he or she leads that organization well from a technical standpoint but also has the leadership skills to reach out and work closely with his or her business partners.”

Some technologists are more comfortable dealing with coldly rational networks and systems than they are with uncomfortably unpredictable human beings. Robinson is not one of them. “I think it’s come fairly naturally for me,” he states. “I’m pretty much a customer focused person so that helps me build those relationships and manage the technology side of the equation.” This confidence can be attributed to Robinson’s diverse range of experiences. “Throughout my career I’ve switched between business and IT roles and I think that has been very important in helping me shape my leadership for this role.”

As an extremely new CIO, the way Robinson handles his first months and years in the position will be key. He’s approaching his fresh responsibilities with gusto and already has a number of plans and initiatives mapped out. “One of the things that I do within the first 90 days or so of starting a role, is to try to create a strategic framework by which I can talk to internal teams, about what we’re working on,” he explains. Perhaps fittingly, considering his earlier responsibility for CRM, customer experience is currently at the top of the agenda. “We have a slew of initiatives in this space,’ he continues. “One that comes to mind is our interactive voice response system for our consumer call center. We just upgraded that. It’s in production and we’re flipping the switch to have all the calls come through that platform very soon, so we feel pretty excited.”

The project has already been generating some positive results. “We’re beating the business case of what we thought we would get,” Robinson explains. “That platform is something that will provide a much better voice system interaction with our customers. They’re going be much more happy with what they have on that platform and it’s going to make us more efficient in what we do. We’re pretty excited about it, and that’s just one example of something we’re working on.” The CIO goes on to detail an impressively ambitious raft of plans that take in mobile banking, processing strategies and electronic check imaging. It’s clear that, despite the rocky period the industry currently faces, Fifth Third is keeping is going to keep thinking about the future. With Robinson at the helm, the bank’s technology setup is will focus on continuous improvement that will help the organization differentiate itself in the market. It will be a challenge that the executive is approaching with a clear sense of purpose. “We have to continue to upgrade and keep current,” he says. “It’s my responsibility as CIO to look internally and figure out ways to make the IT organization more effective.”

End of article

The M&A Team

Robinson explains how a crack squad of professionals make acquisitions move at record speed

We’ll bring our acquired company into the Fifth Third platform and into the fold basically immediately. This allows us to take advantage of efficiencies, but it also provides the acquired firm immediate access to our products and services. We’ve done this time and time again so we have practice and experiences but I think the challenges would be pretty obvious. The whole data mapping and integrity process and customer communications are very challenging and important to us. We try to pay special attention to understand how these customer facing applications are going be transitioned, and obviously we have to train and ready the new team to deal with the new platforms that they’ll be facing when they walk into their banking center on Monday morning. We have a dedicated team that does this job time and time again and when we have no acquisitions they go back to other roles. We manage it across the bank so that while the IT team is working hard on their integration strategies and building the data mapping and so forth the retail teams are working and the communication teams are working. Everyone is working together across one project management office to drive the program to completion. So I think the dedication focus and repeatability of the processes we set up are really the things that drive success. There’s almost a culture around it where we know this is what we do, this is how we do it, and when we announce the acquisitions and we start to lay out timelines everyone just files in line to get it done. It is pretty exciting to watch and I think it’s one of our competitive advantages.

More than just a bank

Robinson on how Fifth Third leverages its IT to create new streams of income

We have our Fifth Third processing solutions business that processes over 27 billion transactions annually but it’s made up of three business units. One unit is the merchant services business where we serve over 37,000 merchant customers, and these merchant customers have over 157,000 merchant locations. So that’s one component. Another component is our bank card services. We’re one of the largest issuers of MasterCard branded debit cards, and then there is the Fifth Third processing solutions business, and this is made up of various services. I’ll just give you a few examples.

We run ATM processing so we drive over 11,000 ATMs throughout the states and across 11 countries for over 2700 customers. We do debit card processing so we’ll produce cards and we’ll manage the transactions, and we also do network gateway services. So we connect that debit transaction to wherever it needs to go whether it’s through our network or different network like Pulse or Nice or what have you. So those are some of the key services that we provide through that business. As you can imagine we have some pretty extensive network services capabilities within the organization. From an IT standpoint we are known for our technical excellence in this space and we are extremely competitive. Also the work we do, the experience and know how that we gain just helps us manage the rest of our Bancorp that much better. We can leverage economies of scale and just do a better job driving excellence across the IT organization.