2 Areas Not To Outsource

Part 1 Here

In my last post, I submitted that today’s outsourcing is not all that different from basic economic specialization.  We can see that due to advances in technology – particularly communications – the pool of places, talent and resources to draw from is now essentially global and nearing limitless.  Often times my customers ask me questions and I have to point out that the question they have asked is not a matter of “can” something be done, but instead “should” it.  That is where these options with outsourcing have left us.

So what areas should a successful corporation focus on?  Obviously those that offer the biggest return in cost savings.  Now those who have done business with me over the years know me to be perhaps obsessive when it comes to focusing on hard dollar ROI and having very little tolerance for the soft dollar pay-backs that are often used to justify technology sales.  That being said, one has to consider all the COSTS including harder to estimate impacts on other areas of the organization.   Continue reading “2 Areas Not To Outsource”


A Timely Technology Solution

Now picture 7.3 million of these
Now picture 7.3 million of these

Saturday’s Wall Street Journal had an interesting headline: Massive Effort To Save Mortgages.  The article went into how JP Morgan was planning on targeting 400,000 loans for modification of terms on top of what they were already doing.  It also mentioned some other banks such as Bank of America’s efforts to modify the terms of existing loans in lieu of foreclosure.  The article points out that “…7.3 million American Homeowners are expected to default on their mortgages between 2008 and 2010.”

As you might expect, when banks transact business with other banks, things can be done in a largely electronic environment generating minimal amounts of paper.  Since individual homeowners don’t have systems that hook directly into lenders the process of modifying the terms (mod) of a loan is done almost exclusively on paper.  Things like pay stubs, tax returns, letters of hardship are used to determine what can be done for each loan.  This means that even simple mods may carry 20-40 pages of faxes, mail, etc. inbound to the lender.  Multiply that by say 7 million and you have yourself a mess of paper.

So many times I see companies in Corporate America spending money on technology for the sake of technology instead of a solid Return on Investment like cutting costs.  In this case however, I came across a service that is specifically targeted to handle all the paperwork related to the workout options for these loans.  I put a copy of the PDF for the service on my website if anyone is interested in an overview (full disclosure: I have worked on various projects with this company for over ten years and am not a totally disinterested party).  It is exciting to see how technology can be used to effectively address something that is urgent, timely and expensive without being overcomplicated.

The service is particularly appealing to lenders because they really don’t have large capital expenditure budgets floating around right now.  Instead of a long drawn out implementation and large amounts of money down, they “pay by the drink” if you will.  It gives lenders who are under pressure to mod loans an option other than throwing more bodies at the problem and hope they can keep ahead of the tide.  Essentially it is a way for them to focus on the decision making aspect of the process rather than the menial, clerical and repetitive tasks.

This is technology and efficiency at its best and it is great when it happens.  Do you have any positive / timely technology examples?  Put it in the comments and I will do my best to address it.

A Missed Opportunity for the Republican Party

Part 1

In a few weeks, the election will be over and the Republican Party will ask itself where it went so wrong that caused them to be beaten so badly. McCain is a war hero, loads of experience and fairly clean for a politician. What is not to like? I can save some time and clear things up for them. McCain failed to clearly stand for anything.

Maybe We Should Subsidize Fertilizer
Maybe We Should Subsidize Fertilizer

Obama seems to be a good man overall. He is compelling, dynamic and strikes me as someone who believes in what he is saying. The problem is not whether he is a nice man though. At issue is whether he will do a good job with the country. His prescription for how to best fix things: follow one of largest expansions of government spending in the history of the country with an even larger one. If you think that is a good thing or that productive people have a responsibility to work for those who are not productive you can stop reading here.

When the people find they can vote themselves money, that will herald the end of the republic. Benjamin Franklin July 4th, 1776

In any interview with McCain and in any opportunity to spell out his plans, the answer to any question that comes up invariably involves spending more money. According to the National Taxpayers Union John McCain will increase annual federal spending by $92 billion and Barack Obama will add $293 billion. If the race is to be decided by whoever promises the most to the public, McCain is getting beaten badly. At the same time, it is very difficult to put on a serious face about being fiscally conservative when you are saying that you want to increase the budget deficit by 20% your first year in office.

The question is, if McCain is not trying to buy the vote with his fancy promises of fairytale government healthcare (still socialized healthcare, but not AS socialized as Obama’s doesn’t sound that nice), increased privatization of foolish real estate speculating or a myriad of other attempts to take from those who are productive and give to those who are not, then what IS he trying to appeal to voters on?

The answer to why McCain got slaughtered in this election is not that he is old, boring, choose a running mate that talks to her invisible friends or even that he is following an awful president from his own party. The answer is that he does not stand for ANYTHING. There may have been a time when John McCain spoke his peace and stood up for what he thought was right even if it was against the advice of his political handlers. That time is long gone.

McCain’s platform is now a mush of compromises intended to appeal to the most people possible. The result is a plan where any underlying guiding principles or philosophy that he may have once possessed has been obliterated. Trying to appeal to the “average” American who shoves fast food in their face by day and rots their brain at night with American Idol and the like on TV is not the answer to fixing what is wrong with this country. These people will continue to fester and decay and their vote is not what is going to chart a successful course for the country (although it may lead to government subsidized McDonalds in 2012 paid for with more debt and the sweat of the few remaining productive people of this country).

The Republicans have missed an opportunity to define themselves for future generations. Instead of being a party that stood for letting honest men earn and keep the product of their efforts, they grasp onto scaled down versions of the same social engineering experiments the Democrats are proposing. It is as if they are conceding things like “Capitalism doesn’t work”/ “The Free Market Failed” etc. but don’t want to address it as aggressively as the Democrats. Instead of defending the principles that built the country, the Republican’s have given tacit endorsement to having the role of the government be that of a Nanny.

Rather than debate whether the government should be growing at all, the only permissible conversation is how MUCH the government should grow. When you don’t stand for the free market (healthcare, banking etc.), when you don’t stand for personal responsibility (socialize losses from foolish real estate investments), when you don’t stand up for free speech (warrant less wiretaps) and you have no plans to reduce our foreign presence (permanent troops in over 130 countries), what DO you stand for?

Up next: What can we do about it BEFORE the election?

Making Your LCD Monitor Investment Pay Off

When I took the test as a Certified Document Imaging Architech (CDIA) over ten years ago, there were a lot of questions and calculations involved with figuring out things like pixel pitch on displays. It was very important to invest in expensive monitors so that scanned images could be accurately displayed for the user. Today’s modern LCD wide screen monitors offer unparalleled clarity when working with scanned images alongside a line of business application. Many organizations are investing in dual monitor or large LCD monitors for their employees in these environments. When brightness and contrast are set properly, the worker not only has access to all the information they need on one screen, their eyes do not fatigue as quickly as more expensive monitors from just a few years ago. This makes for a productive environment and worker. Often though, one user preference is overlooked. Continue reading “Making Your LCD Monitor Investment Pay Off”

Dealing With Red Tape?

How will lenders cope with increased oversight requirements?

How will lenders cope with increased oversight requirements?

The reaction to recent developments in the mortgage lending world seems to dominate the headlines. Each morning, the front page of Wall Street Journal brings news of yet another lender closing their doors or “suspending” operations. Meanwhile, various opinion pieces are calling for new government regulations.

Whether we see new requirements from the government or simply change to appease frightened stockholders, the coming months and years are sure to add complexity to an already cumbersome process. The companies that remain as lenders will likely see huge volumes of loans even if the overall number of loans decreases simply by taking volume that might have been distributed to those who have left the industry. These volumes are likely to be sustained since it will be very difficult for any new players to raise money to enter the market.

Traditionally, lenders have added headcount to address up ticks in volume. Continue reading “Dealing With Red Tape?”