As measured by trades per day, Ameritrade is the fifth-largest online broker. It is also one of the most visible, having launched a $200 million advertising campaign last fall.
But the company has also invested heavily in its own architecture. When TechRepublic interviewed Ameritrade’s CIO Jim Ditmore, its site was listed as the fastest on the Web by Keynote. We spoke with Ditmore about the role of the CIO, recruiting IT talent, and technology.
TR: Have you been involved in Ameritrade’s marketing efforts?
Ditmore: Given the importance of technology in the business…really we have equal footing with the business units in terms of decisions with the company. So we’re part of the overall strategic, business decision-making process. We’re a peer to the business unit.
TR: Do you think that a CIO would have had that kind of influence five or 10 years ago?
Ditmore: I would say five or 10 years ago at the most advanced firms you saw it. If you look at firms like Progressive [Insurance Co.], for example, I think they were there five or 10 years ago. But it’s certainly more prevalent now than where it was, which I think is positive. If you look at the evolution, you used to be called an MIS and [the CIO] used to report to the CFO.
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TR: What challenges do you face as a CIO with an online broker?
Ditmore: I think there are a couple. Number one, of course, is staffing, getting the resources. Number two is ensuring that you stay consistent with the business objectives and that they are well defined. And I think the third is ensuring that you really apply overall process engineering in addition to system-features changes.
TR: With the competition for IT talent so fierce, do you have some creative ways to recruit and retain high-tech workers?
Ditmore: I think that we try to be as resourceful as anyone to ensure that we attract and retain the best talent. People stay for a variety of reasons—from opportunity to pay to the challenge to teamwork—and we try to make sure that we have that in place on all fronts. It’s something that we definitely focus and spend a lot of management time on.
TR: Any retention and recruitment tools that you’re proud of? Do you offer stock options, for example?
Ditmore: We offer stock options; we offer significant bonus opportunities based on company results and individual performance. We do all of that. But I think in the end it really comes down to the opportunity and the teamwork that is present.
TR: As the CIO, how do you help Ameritrade stay consistent with business objectives?
Ditmore: You have to have excellent communication both ways in terms of helping to formulate the business direction as well as getting feedback on how technology is delivering.
TR: How is Ameritrade structured?
Ditmore: We’re based more on a traditional organization where we have operations. We have applications. We have infrastructure.
TR: Do you see that changing over the next few years?
Ditmore: No, it’s very effective.
TR: What determines a CIO’s longevity?
Ditmore: I think you have to deliver. The expectations are greater than ever before. Not only do you have to deliver, you have to make sure that you manage the expectations properly so that you don’t let the expectations get out of hand.
You have to make sure that your goals match the business goals, and that what you’re going to do is doable and then you go out and you do it.
TR: Do you have any numbers in terms of your growth?
Ditmore: We’re growing at more than 100 percent a year.
TR: It seems that there are more online trading firms as well as traditional brokerage houses that are offering similar services. What are some things that you have in place to compete?
Ditmore: We have several things that we’ve really worked to improve on. Number one is that we feel we have the best customer service in the business. In addition to our customer service, we feel we have a very reliable and extremely fast Web capability.
We feel that we have all of the key services that someone is going to need for online trading. And then if they want to do wireless trading or trading via the phone, that can all be done very effectively for a very low cost. We have a tremendous value proposition for our customers.
TR: What are some things that you try to do to assure customers that their transactions are safe?
Ditmore: We have a very strict privacy policy, and we also feel that we have been very focused and made a very concerted effort to put in some of the best security on the Internet to protect our customers.
TR: Do you get inquiries from customers about security measures? Are consumers becoming more cognizant of such issues?
Ditmore: I think so, and I hope that consumers in general will become more aware of how to protect themselves and the appropriate measures to take.
TR: How is your site performance? (During the week TechRepublic interviewed Ditmore, the company’s Web site was listed as the fastest site on the Web for the week of March 26 as rated by Keynote . In the Keynote Consumer 40 list, Ameritrade had a load time of slightly more than 3.4 seconds.)
Ditmore: We beat Yahoo!. We beat all the portals. We’re the only non-portal site in the top five and we beat them this time around.
TR:What are some things you have in place to ensure the speed?
Ditmore: We don’t use all of those third-party things that you always hear about everyone using on the Web. We don’t do that. We do our own. We have a very straightforward UNIX/Oracle environment with very high-powered UNIX servers.
TR: What advantages do you feel UNIX servers have given you?
Ditmore: Reliability and speed. I also have the ability to go to different providers of them. We use Sun’s top ones; we’re looking at IBM right now.
TR: Do you have a system in place so that if a piece of technology isn’t working effectively, it comes to your attention?
Ditmore: Other than the regular one-on-one sessions with the business and regular meetings with business and ensuring that we have those frank discussions, the two tools that are most important are:
- We use the intranet as a communications vehicle. All of our projects of statuses and project deliverables are on the intranet. All of the information about our operational performance is on our intranet, and it’s just a tremendous vehicle for that.
- We put in place very structured processes and responsibilities. Everyone knows how you start a project. What’s the life cycle of the project? What are the templates you use for requirements and testing and all of the deliverables? All of those are in relatively standardized formats so that it makes it easy for us to communicate. We have a common dialect, and you can reach it without having to set up a meeting.
You can go right to the intranet and find out what’s going on with that project, and you don’t have to call anyone even. Just go out and find out.
Do you have an intranet that works like Ameritrade’s? Are you putting one together? Tell us about it. Post a comment below or send us an e-mail.