By identifying who's who as soon as someone arrives at the website, the site can present options in a different order, he says, so an individual gets the experience that makes the most sense to him. Changing the flow of screens and promotional offers can increase loyalty and yield higher revenues, he says. This kind of analysis is improving collaboration between IT and sales. "The business says, 'I got a half-point uptick because of [those changes].' We say, 'That's great.'"
Of course, the CEO also wants all the IT work to deliver significant financial payback, and fast. "We don't pour money into anything without returns," he says.
ROI on the CIO
One big investment Western Union's CEO has made is swapping out one CIO for a new, more expensive one from outside the industry. John Dick, who was CIO from 2008 to 2012, was reportedly asked to leave, telling an audience at a Forrester conference that Ersek sought someone with different skills. A Western Union spokesman confirms that the company rethought the CIO position.
"The role and priorities of the position were realigned around our technology and operations needs to better drive our customer-centric strategy," he says, declining to comment further. Dick, who is now CIO at staffing firm Towers Watson, didn't respond to a request for comment.
While Dick had spent nearly all of his 32-year career in financial services, Thompson hadn't ever worked in financial services before. His most recent CIO jobs were at Symantec, Oracle and PeopleSoft. When Western Union's board of directors discussed what to pay Thompson, they considered not only the going rate for CIOs but also the magnitude of what they were asking him to do, according to the company's latest proxy statement. Earning $3.4 million, he is the second-highest-paid officer at the company, behind Ersek. So far, the CEO calls Thompson "one of my best hires."
Startups Plot to Dethrone Western Union
Plenty of companies, big and small, want to steal Western Union's business using advances in electronic money and digital payments. Some startups are partnering with established players in telecommunications and other industries to reach consumers who usually don't have bank accounts, but who nonetheless pay bills and send money to family and friends. Others are working feverishly alone.
Since 2011, venture capitalists have invested at least $104 million in money-transfer startups, according to researcher CB Insights, which characterizes these 39 deals as attempts at "disrupting Western Union."
"The money-transfer market is ripe for disruption because it's not a very satisfying experience for a customer right now," says Denee Carrington, a senior analyst at Forrester.
For example, senders wait at a customer-service desk, fill out paperwork and then have to wait again while the transaction is processed. Customers also can't usually track their transactions along the way, like they would with a FedEx package, and sometimes receivers don't get the funds, Carrington says. Plus, customers must pay fees and currency exchange rates set by Western Union and MoneyGram, the dominant players.
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