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CEO John Tippets rarely hears a peep from his IT department.

"I know that my IT group is doing a good job because I extremely rarely hear any negative feedback," said the American Airlines FCU (AAFCU) chief. "I hate to say it, but exception is the barometer."

In fact, Tippets said he stays "remote" from the everyday trends and trials of technology at the nation's ninth largest CU.

"IT needs more high-level involvement than I can give it," he said. "And I work with a lot of people who have their feet closer to the ground with technology."

Which is not to say the CEO of the nation's ninth largest CU is an IT-ignoramus.

Tippets keeps tabs on technology through his chain of command, beginning with his senior vice president of finance and technology, Carol Brown.

"I can give IT about 10% of my time, but Carol can give it up to 50% of her time," explained Tippets.

In turn, Brown-who wields both computer engineering and management degrees- schedules about five hours per week to consult with Chief Information Officer Gary Lindsey.

"The weekly meeting is essential to determining if projects are properly prioritized, if resources are being properly applied, and if there are any roadblocks," Brown said. "Gary and I also meet informally during the week to discuss the progress of high profile projects."

This credit union IT triumvirate seems to keep technology on a tight rein, despite the organization's $4 billion in assets.

"Credit unions aren't profit-oriented, and they can grossly overspend in IT without realizing it." Tippets said. "So you have to force yourself to some level of debate on whether you're spending your money smartly- on whether you're going to get ROI."

Brown concurred. "We continuously benchmark technology from a capability and cost standpoint. Although we are considered a large credit union, we haven't forgotten we are spending members' money and take great ownership in these decisions."

AAFCU can't always pin down Return On Investment (ROI) for technology, however.

"Some projects defy ROI analysis," Brown said. Two prime examples this year are Enterprise Risk Assessment and Business Continuity Planning, she said.

Such projects can't completely escape the CU's scrutiny, however.

"Although a project might have returns that are difficult to quantify, that doesn't mean we toss out analytics altogether," Brown continued. "The key to this type of project is to clearly define the scope and expected outcome. We then measure against that outcome throughout the project to ensure the credit union gets the results intended for the price originally planned."

Enterprise Risk Assessment will help AAFCU take stock of technology spending on what has become the industry's hot spot, Information Security, Tippets added.

Risk analysis also can help credit unions identify a customized security solution, which should then be reviewed at least annually, added Terry Treadwell, director of Market Strategies at SUMMIT Information Systems, providing AAFCU's core processing services.

The IT trio at AAFCU started with the 15-year relationship between Tippets and Lindsey. Brown is the late-comer, joining the CU in 1998 and the technology group two years ago.

Brown demonstrates the perfect mix of IT and business, according to Tippets. Beyond her degrees, she spent time in various business units at AAFCU before assuming her current role as senior vice president.

"Her academic qualifications and her knowledge of credit union subject matter make a significant contribution to the IT group," Tippets explained. "She has a good sense of the technology end-user's expectations."

CUJ Resources

For info on this story:

* American Airlines FCU at www.aacreditunion.org

* SUMMIT Information Systems at www.summitsite.net

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