As the corporate technology officer at Citigroup, Taub coordinates policies used by the far-flung operations of about 280,000 employees at more than 100 regions across the globe. With Citigroup involved in services from branch banking to life insurance, Taub's work is crucial to making sure that the right hand knows what the left is doing at the nation's largest financial services company.

Taub is acutely aware that the purchase and use of technology at Citigroup is a high-wire act that could easily collapse without close coordination. The company's many divisions, including investment bank Salomon Smith Barney and the Travelers Insurance Group, are powerhouses in their own right and often have vastly different needs.

So it is not surprising to learn that Citigroup uses four versions of customer relationship management software and several enterprise resource planning programs--and it dabbles in Web services at the same time. All this is made even more complicated by the variety and global reach of the company's markets, where systems that keep track of banking transactions in one country might not work in another because of local regulations.

In a recent interview with CNET News.com, Taub outlined his strategy for managing one of the world's most complex financial networks.

Q: What's your philosophy about new technology? Does Citigroup implement it right away, or do you prefer to take a wait-and-see position?
A: We do not want to be at the bleeding edge. We want to be leaders, but we make sure that what we are going to base an installation on will work. It's not good enough to say, "The reason we didn't come in on time is because Microsoft software didn't work or IBM software didn't work." That's unacceptable. If we choose a platform, we're choosing it because we're confident that we're going to be able to deliver on that platform...That's why we don't have any very large databases on (Microsoft's) SQL Server (software) right now. It hasn't been proven. Not to say it can't do it. We just haven't seen the proof.

Given that, what's going to be the most important new technology for Citigroup in the near future?
I'd say there are several. I think wireless is very important to us. Software for information security--both in terms of preventive information security and reactive information security--is very important to us as well. Also, along the lines of security, new kinds of technology to authenticate our clients will be very important. And then, of course, integrating databases because we want to have a single view of the customer--whether you call it CRM (customer relationship management) or you just call it data integration, I think those are issues. And I would also make another comment about integrating systems and converging platforms because there are opportunities that those initiatives provide to save a lot of money and be much more efficient in the way we operate.

All the different technologies coming to market seem to be getting more and more sophisticated and complex. Are these getting any easier or more difficult to implement, use and maintain? And what does that mean for the IT staff at Citigroup?
We're a pretty complex environment because of all the countries we operate in. There are country needs and then regional needs, often beyond our ability to control, like regulatory reporting environments or confidentiality requirements. So any major implementation that we do involves quite a bit of complexity if we want to use the same application software to satisfy a global need. To that degree, installing an enterprisewide solution is a significant challenge.

Can you offer a concrete example of that?

But it's not quite a simple deal to install the same set of software in every one of these countries, because...we have to interface with every regulatory or clearing agency in these countries. And we have to provide appropriate customer reporting and product information to meet the market needs. Our challenge is to create a consistent set of code that allows customization without violating the core of the system. That's a big challenge.

Which operating systems are used across the company?
We're doing very little Linux; right now, we're just experimenting with Linux. We're running just about every other platform you might imagine. We run a great deal on IBM mainframes in our larger businesses, running IBM's operating system on the mainframes. We run our trading applications for Salomon Smith Barney primarily on Sun Solaris systems. We run our administrative applications with a lot of use of Microsoft software. Our selected e-mail platform is Exchange, and we're in the process of converting the whole bank to Exchange. We use Hewlett-Packard platforms in some parts of the world.

How do you decide what's more appropriate for each department?
A couple of ways. Is there an application available that we might purchase that runs on one or another of these platforms? Or do the local people have expertise in selected systems, like HP in Europe or Sun Solaris in our trading environments in New York? Or are the requirements of this system such that we need to manage very large databases and have them run on a mainframe? For selected applications, we use the DB2 database heavily on the mainframe. We use SQL Server in the Microsoft environments. We use Oracle on a number of our applications, and Oracle is the database management system of choice for our procure-to-pay system. It will also be the selected platform for our human resources system, which is a PeopleSoft system. We use virtually every major platform, and it depends on the application's functional requirements and our degree of expertise among the team who has to deliver it.

What are you using on the desktop?
On the desktop is Microsoft. We've been installing XP in small parts of our business, and that will be rolled out over time. But basically, it's Win 2000.

Is there enough power on the desktop now with your current crop of Pentium 4 machines? How do you decide when you need to upgrade those machines?
We do not have a calendar-driven refresh cycle. What we do is look at the capacity utilization of the desktop systems depending on the business being supported. And we add to that the planned incremental applications that will be used on that desktop to see when we will need to increase capacity in order to support the client's requirements.

How often does that happen?
It varies by business. In Salomon Smith Barney, we have 20,000 desktops supporting the retail business. In 1995, we installed a system across all of Salomon Smith Barney's retail business--for those 20,000-plus desktops--with the PCs that were available at the time. We refreshed those in 2000 because of the coming of decimalization in the securities business and the recognition that we had increased the applications that our retail financial consultants were relying on, and we saw performance tending to degrade. In the investment bank, where our research people drive their desktops very, very hard with a lot of applications and a lot of data requirements, we probably refreshed twice in the same period of time.

Are you launching any Web services?
Our toe is in the water. We're doing work with .Net. We've got some things going on in the Travelers business, for example, and some work is also going on in the corporate investment bank. I won't say we're in it with both feet yet, but it is part of our strategy.

In the corporate investment bank, there's an initiative to deliver more comprehensive information to the institutional customer,...and (that) is a major project that brings together information from a variety of Citigroup sources in order to present data to those individuals. That is being worked on with .Net. With Travelers insurance, I think there's some agent systems being focused on .Net (technology). (The unit that issues) credit cards (is) also looking at employing .Net.

What's your impression so far? Does the reality match up to the hype?
A lot of our decisions about using the platform are based on the business objectives of the entire system and how we think it can best be served. I think it's still early to make the call on how that's going to play out. I also think it depends on how you implement. We tend to implement by running the software in our own shop, and not using a hosted environment to run things. So the software we choose to employ has to be (able to run) in our own environments and has to give us the appropriate information (and) security protection that we need. It's tough to say whether Web services will satisfy everything we need in the near term. But we'll find out before we go whole hog.

What is your biggest disappointment so far with Web-based technologies?
Today, every one of the millions of customers who are online can look at their accounts whenever they want to. If there is a production problem, then it's glaringly apparent to the whole world, whether or not it allows somebody to do something illicit or illegal. Our vulnerability is very high. What that really means is that the need for quality assurance in all of your processes--quality processing, do it right the first time, don't make an error when you install new versions of software or make enhancements to what runs--all those things become increasingly more important.

Earlier, you were talking about having Oracle and PeopleSoft on the back end. It sounds like you are launching some ERP (enterprise resource planning) applications.
We're rolling out major implementations across our businesses. One is in HR, which is a PeopleSoft implementation. We decided that we would install PeopleSoft across all of Citigroup. We literally are in the early stages of it, but we have made that commitment. Every business at the (human resources) level and the CEO level has signed on to using that system going forward.

What kind of return on investment (ROI) are you looking for when you launch PeopleSoft for your human resources department or other ERP systems?
We're looking for a reasonable ROI. I won't give you any numbers, but there is a reasonable cost payback in terms of reduced staff and based on better information to HR and business executives in running their businesses. If you consider the fact that we are in over 100 countries, we have a challenge in terms of getting consistent data collected and then presented to management to make decisions. So we see a tremendous opportunity to have a data warehouse that will give us all the information about our employees.

How soon do you expect it to start paying for itself?
Less than two years.

Are you launching any CRM applications?
We are, but in a different way. CRM is very heavily dependent on how you define it. What's your objective? Is it a call center solution? Is it a prospecting solution? Is it analytics that you want? Is it managing mail campaigns and follow-up? Each one of those might require a different kind of solution.

In the area of CRM, we've done considerable work to identify which CRM products make sense and have been either implemented or are in implementation across the businesses. We're heavy users of Siebel, which is the predominant vendor. But we're also users of Epiphany and Kana, and in one case, PeopleSoft CRM is being deployed.

Again, why the different decisions?
The reason we made the different decisions was based on the specific objectives of the business in implementing a CRM solution. What we're doing there is we've created a center of excellence where we know what criteria one should be looking at to choose one or another of these products. We have encouraged the business IT people to work with the people with the knowledge--with the information about what's been or is being installed and what's driving it--in order to derive a conclusion about which vendor solution is the best for them.

What kind of return are you looking for with CRM?

One of the things that's amazed me in covering online banking is that you can send an e-mail that gets to somebody instantaneously, but it takes two days to send an online payment.
That goes back to connecting your Web-based technology to batch-based back-office systems that need to be replaced, upgraded, enhanced, stuff like that.

What is the time line at Citigroup for upgrading those systems?
Well, each one has its own time line, and this is something that is on the agenda to deal with. We intend to continue to use the Web as a mechanism to interact with our customers very efficiently and with high quality. Each business has to determine the sequence in which it wants to address specific applications. So it is something on the list, but I couldn't tell you that every business is approaching it in the same way. I can tell you that some businesses are doing it sooner rather than later because they see the need to address it.

It's like Salomon Smith Barney, where while the back-office systems operate at night, there is shadow posting of transactions during the day. If you trade in the morning, you could look at the effect of that transaction later in the same day. You're not waiting for the nighttime productions to take place. But that meant that business had to fund the work to redo the processing in a real-time mode, because it's the nighttime processing that gives us the real books and records. So each business has to decide how important it is to do these new kinds of enhancements in order to provide the right kind of customer service.

How much does Citigroup spend on IT, and will you spend more this year than last year?
We do not discuss our IT spending, but generally, our overall spending levels are going down.

How much of the IT work at Citigroup do you outsource, and what sorts of projects are those?
We outsource very little technology operations. These would only be very selective and very remote--where we didn't think it was strategic to our businesses, but there was expertise outside. It might be some local desktop support in some foreign country. It might be a very small data center in some foreign country. In the area of development, we outsource some amount of maintenance, but a lot of that's done with a company or two in which we own an interest in India.

But the percentage is relatively low?
We tend not to outsource a lot of development. I'm using the term "outsource" very strictly, which means when you give away a project and tell somebody, "Come back when it's done." We don't typically do that. We manage our own projects. We will hire consultants who are really developers and add them to project teams. We will buy packaged software wherever we can if we feel that the software meets the functional requirements that have to be satisfied. In fact, our first preference is to buy rather than build.

In some businesses, we're more successful than others. As you might imagine, we're usually successful in general systems like human resources or procurement or financial systems, which are not specific to a business. And we tend to do our own development for major business applications, whether they are in Salomon Smith Barney for trading applications or in the (credit) cards business for cards applications.

How do you measure success and failure as a corporate technology officer?
We measure the success of technology activity in several ways. We expect to see infrastructure expenses go down and service quality levels go up. We expect to see business recognition that their technology investments, spanning infrastructure and development, are achieving expected benefits. We expect the adoption of best practices by business IT organizations and the leveraging of technology solutions across businesses; the convergence of infrastructure, applications and platforms towards standard solutions; acceptance and adherence to Citigroup's technology policies and standards; and positive feedback from regulatory agencies on Citigroup's management of technology.

What are the main technologies or technology areas you are excited about and will invest in over the next year or so?
Wireless, voice, collaboration, systems and data integration, information authentication and security.

How has information technology, especially Internet-related technology, changed the way business gets done at Citigroup?

Are you more or less skeptical about claims that suppliers are making these days? Any specifics?
It depends on the vendor, the application and the business segment involved.

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