GM's new Innovation Center is transforming the company's IT operations

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2014 06 08 11.01.27 1

GM

This post is sponsored by the Arizona Commerce Authority.

"Insourcing," a term for bringing work back inside a company that previously was done by third parties, is a priority right now for many large corporations. This includes General Motors, where insourcing is instrumental to the company's evolving IT operations, says Ahmed Mahmoud, CIO of GM's Global Manufacturing and Supply Chain.

A 20-year veteran of the IT field, Mahmoud and his team are working to transform GM IT into a company focused on innovative business solutions. "We're in the second year of a multi-year journey to bring IT work back in house," he explains. To reach that goal, GM is in the process of hiring "thousands of experienced IT professionals and new college graduates." Randy Mott, Senior VP and CIO of GM's Global IT team, is leading the transformation.

Corporations used to think their IT departments could be anywhere, so they outsourced the work to outside contractors oftentimes in other countries. But different time zones can make outsourcing less efficient. By opening the company's newest IT center in Chandler, Arizona, with an anticipated staff of 1,000 workers, GM is insourcing in a big way. Having a major presence in Arizona gives GM the opportunity to tap into a wealth of local tech talent, which grants the company a sizable advantage regionally, nationally, and globally.

The Chandler Innovation Center is the last of four software- and systems-development centers GM has opened around the country as part of the transformation effort. GM is hiring thousands of new IT employees to staff the four Innovation Centers. The others are in Michigan, Texas, and Georgia.

According to Mahmoud, the work at the new center in Chandler - a hub for prominent technology companies within the state - will have "a global reach."

Ahmed Mahmoud 3000pxl

GM

Ahmed Mahmoud, CIO of GM's Global Manufacturing and Supply Chain

"We've been fortunate that Arizona's workforce is dynamic and varied," Mahmoud says. The state boasts a strong millennial workforce and has more than 142 colleges, universities, and technical schools, including three state universities: Northern Arizona University, the University of Arizona (U of A), and Arizona State University (ASU), the nation's largest public university.

Arizona's highly trained workforce has already helped GM reach its early hiring goals. "One of our top schools for new college hires is Arizona State University," Mahmoud says. "It's been in the top three in terms of sheer numbers of graduates who have joined the GM IT team. Arizona University is also in the top 10 for new recruits."

Strategically, Arizona is well situated on the map. Thanks to its Chandler Innovation Center, GM can draw IT talent from Silicon Valley and other high-tech communities on the West Coast. The Greater Phoenix area is also a desirable place to live, Mahmoud says," which helps attract and retain talent. It's a fantastic hub of emerging technical talent for finding talent knowledgeable in everything from SAP to .NET to Java developers, and other high-tech skills."

But like any corporation, GM had other considerations aside from the availability of talent. Executives took into account "the cost of living, cost of doing business, and the business climate." By 2017, Arizona's corporate and personal income tax rates will be among the lowest in the country. On top of that, there's no franchise tax, business inventory tax, or estate tax.

"IT has become a clear competitive advantage for us," says Mahmoud. In its Chandler Innovation Center, the company has found everything it needs to take its IT operations to the next level, from an abundance of tech talent to a collaborative partnership with the state. "We have a good relationship with the local authorities," says Mahmoud. "They've been very receptive and created a positive climate for us to come to Arizona."

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