"How many acres do you farm? What's your wife's name?" Sean Halcomb wants to know.
He's a loan officer at Farm Credit Services (FCS) of Illinois, an agricultural lending institution. When Halcomb gets a new client, his first move is to jot down the essentials: "How many acres they farm, what the guy's wife's name is, what his dog's name is and all that stuff," he says.
Many FCS of Illinois loan officers have been helping farmers buy land and feed the nation since the mid-1970s. Their livelihood is built on old-fashioned business relationships forged on a handshake and passed on from generation to generation.
It was into this traditional environment that FCS of Illinois hired city slicker James Fielder as CIO in 2001. Even though the agricultural lending business harks back to the Civil War, technologies of the past decade presented opportunities for greater efficiencies. Fielder envisioned loan officers toting tablet PCs, tapping into applications over the Internet and zapping data to a centralized location.
The trouble was that he forgot to ask the old hands first.
And so begins the yarn of how Fielder learned a valuable lesson about paying your dues before giving orders, otherwise known as "change management." With IT projects, the old adage "Shoot first, ask questions later" often leads to failure. If anything, Fielder's experience is a good reminder that people -- that is, users -- don't like change and therefore must be engaged if they're going to accept new ways of doing things. Such management skill may not be a technologist's first inclination, but not having it may be his downfall.
A Shifting Landscape
For U.S. farmers, credit's always been tough. In the early days of the industry, bankers in dark suits and ties seemed all too ready to dole out foreclosure notes during every early frost. As early as 1908, presidential commissions recommended that farmers needed alternative sources of credit. By 1916, Congress passed legislation that established the Farm Credit System, a national credit network of cooperative businesses promising farmers credit at competitive rates. These co-ops divvy up territories and vow not to compete with one another (although they can and do compete with traditional banks). All tallied, the system provided $86 billion in loans to a half-million customers in 2004.
Made up of 23 branches and 170 employees, FCS of Illinois is part of this system. It focuses exclusively on 60 counties in the southern half of the state. Four-fifths of Illinois' farm output consists of corn (40%), soybeans (30%) and hogs (10%). In 2004, FCS of Illinois wrote a record $267.8 million in new loans, topping the 2003 total of $244.4 million. The company was growing like a weed, but its executives are quick to concede that this was due in large measure to years of rock-bottom interest rates.
These rates were also lifting the farm credit lender's biggest rivals: 700 community bankers with 1,100 branches operating in FCS of Illinois' territory. Banks had a hammerlock on the market for non-real-estate loans (for operating costs, equipment, seeds and chemicals), touting 63% of market share, compared with the Farm Credit System's 13% (with the remaining 24% of the market falling into an "other" category).
On another competitive front, large food companies that purchase crops finance the farms that grow them. When they act as lenders, food companies have a host of advantages over traditional financial services firms. "They have no marketing costs at all," says Danny Klinefelter, a professor in the depart-ment of agricultural economics at Texas A&M University. "Their risk is lower because they're only financing the farmers they cherry-pick."
Most recently, a foreigner with deep pockets jumped into the fray. Rabobank, a Netherlands-based financial services company with an asset base of more than $600 billion, entered the market a few years ago and gained through acquisition many experienced loan officers who had long-standing relationships with farmers.
All of this underscores FCS of Illinois' business challenges. It must hang on to its loan officers, who, with their customer relationships, are the company's most valuable assets. At the same time, FCS of Illinois must find ways to become more efficient as it stares down an overwhelming number of banks. And it must cut costs to compete with food companies and others.
A Hired Gun
Enter James Fielder, a former Marine staff sergeant and graduate of Illinois State University. In the military, he worked as a trainer in the field of communications; at the university, he launched and ran an IT organization at one of the colleges. "If you embrace [the military] for what it is, you learn leadership very quickly," he says.
Fielder's leadership skills would be put to the test, as the company looked to technology to address some of its challenges. In an effort to improve operations, for instance, Fielder decided to centralize information and processes. He also believed that loan officers could become more efficient when serving customers and filling out paperwork in the field. He figured Acer tablet PCs coupled with Bluetooth-enabled printers would turn every loan officer's truck into a mobile office.
And so Fielder's IT team spent some $40,000 for 30 tablets to replace loan officers' aging laptops. Loan officers would appreciate these devices, Fielder thought, as a tablet with built-in handwriting recognition technology is a more casual note-taking device than a laptop. Tablets would play to the strength of the loan officer, who drives hundreds of miles to chat with farmers in their kitchens. In such a setting, says Leslie Fiering, an analyst with Stamford, Conn.-based research firm Gartner Inc., "flipping up the screen [on a laptop] and typing is considered intrusive."
There were back-end benefits too. With a Citrix/Windows Terminal Server interface, the tablets would store little local data, essentially becoming a front end to a more manageable central system -- a project already in the works. Thus, an excited Fielder forged ahead with his plans. He sent tablets into the field, telling loan officers they were just like a mini version of their laptops.
In retrospect, Fielder says, that approach was a big mistake.
For starters, the initial batch of tablets had temperamental hinges that broke, making a bad first impression. The surprise rollout and movement toward a centralized data environment didn't sit well with loan officers, who were accustomed to working independently. If a loan officer needed a simple amortization schedule, he now had to get wireless Internet access, log in and click around until he tracked it down. Many loan officers complained that the centralization of data was crippling their ability to close sales. Moreover, wireless access was, and remains, scarce in much of FCS of Illinois' territory.
And then there was the slightly different graphical user interface. Unlike the Windows interface, where users have folders on the desktop, Citrix's OneNote uses tabs. "To us as technicians, there doesn't seem to be a lot of difference," says Ryan Hall, help desk technician at FCS of Illinois. "But [loan officers] had been doing things a certain way for a long time."
Many of the old hands weren't even using their laptops, preferring instead to scribble notes on yellow pads of paper. There was no way they were going to embrace new technology, especially when IT was forcing these fancy devices down their throats. Some loan officers asked to have their old laptops back; others reverted to paper notepads; few embraced the new tablets.
The problem came to a head during a training meeting that IT had set up to increase user adoption. About a dozen loan officers decided to give the IT staff a piece of their mind. "They said, 'Look, this is what we're doing out here. This is how we work,'" Fielder recalls. "So we stopped talking and let them talk."
A Valuable Lesson
To some experts, betting the farm on tablets is risky. Fiering says that today's tablets work well as "clipboard replacements" for field workers who perform basic forms-based tasks, not as general-use computers for knowledge workers. And while the concept of the tablet PC is compelling, the technology is not completely mature. The most common user complaints: handwriting recognition that's not up to par and hinge-and-clasp hardware that doesn't stand up to real-world use.
As a result of the uprising, Fielder realized his group needed to develop better project management practices. He and two staffers joined the Project Management Institute (PMI), and today Fielder is close to securing a certificate. One big lesson they learned at PMI: Put into practice a repeatable process that polls users before major IT changes are made.
Now the IT staff posts surveys on the company intranet before implementing significant technology changes. The feedback influences whether those changes are made and, if so, how they're communicated to users. Moreover, Dan Johnston, a business analyst who serves as a liaison on IT projects, has been sent into the field and spends nearly all his time at remote offices and on sales calls. His goal: to learn how loan officers use technology.
"I just sit down and ask, 'What do you do in a day? What are you responsible for? Where do you run into problems?'" says Johnston. He's uncovered real-world problems, such as redundant data entry, that IT can help solve. "The biggest thing is that when people in branches have problems, they don't call us," he adds. "They find a workaround and deal with it ... until it gets so bad they have to call." With more knowledge, IT can now actively find problems and head them off at the pass.
But fixing a failed project has proved to be a lot harder than launching a new one. After learning that loan officers have customer portfolios that date back 30 years, Fielder had to modify the data centralization plan. It was burdensome to transmit that data back and forth to headquarters, so in some cases, users are still keeping customer records on their hard drives. Many old-school loan officers show no signs of ever using the machines, and Fielder doesn't force the issue anymore. "As long as they're making money for the company, it's up to them on how they do it," he says.
On the other hand, there have been some high points. One seasoned loan officer used to be married to a yellow notepad, taking disciplined and organized notes. In fact, his notepad looked like an Excel spreadsheet. The tablet PC played perfectly to his orderly nature, with its handwriting recognition capability matching the way he records information. After IT staff showed him how the tablet works, says Fielder, "he said he needed one of those right away."
And younger loan officers have also taken to the tablets. "It is handy to use handwriting," says Halcomb, who has been with FCS of Illinois for a year and a half. "I'll make three or four calls, then write down my notes and my thoughts [in the tablet]. If I was doing it in a [paper] notebook, I'd have to type it up later. And if I was doing it in a Word doc, it'd take more time. ... I get it done quicker this way."
The Grass-Roots Approach
IT is moving beyond the painful experience of the tablets project. Business analyst Johnston is getting to know the loan officers and to observe how they work. That has given him ideas for new technologies that are driven by the business side. Recently, he met a loan officer at a branch office who had spent nine years quietly refining his homegrown customer relationship management (CRM) application. It was so impressive and perfectly tailored to FCS of Illinois' needs that Fielder may soon implement the application throughout the company.
Since this potential CRM project sprouted from a loan officer, chances are that Fielder and his IT staff will have strong user adoption. It's a far cry from the heady days of the tablet PC. "We did what technicians do," says Fielder. "We said, 'Hey, let's get it out there; let's get it done.' But we hadn't embraced any particular project management philosophy -- and it came back to catch us."
Steve Ulfelder was a senior features writer at CIO Decisions. To comment on this story, email email@example.com.