Exclusive Interview with Ally Financial CIO Michael Baresich

Michael Baresich joined Ally Financial in January 2012 as Chief Information Officer. In this role, he has global responsibility for all information technology and related services, including application development, operations, infrastructure, and information security.

Prior to joining Ally, Baresich was Executive Vice President and Chief Information Officer of CIT Group, where he was responsible for all information technology worldwide.

In addition to his role at CIT, Baresich served in various senior-level IT positions over a span of 25 years, including Managing Director and Global Chief Information Officer at Citigroup Asset Management; CEO of CoKinetic Systems Corp., a software development and services company; and global head of Information Technology and Operations for Deutsche Bank Asset Management.

Baresich received a bachelor’s degree from Harpur College at Binghamton University and master’s degrees from the University of Florida and The Wharton School of the University of Pennsylvania. He serves on the board of directors for CoKinetic Systems Corporation, and the IT Advisory Board of New York Life. Baresich is an active participant in the New York FinTech Innovation Lab, which provides support to technology startups. He serves as a director of Skilled, a not-for-profit organization working to provide opportunities for adults with autism. He is also active in fundraising for other organizations in the autism community, including NEXT for Autism, and the Cooke Center for Learning and Development.


BT (Grace Guan): What was your journey like from your Master's degrees to where you are today?

Michael Baresich: I would say that careers are a like life itself. They are long and have many twists and turns. Comparing where I started out to where I ended up, I ended up in a pretty different place than I believed I would. At first, I was more interested in an academic career. I didn’t want to have anything to do with business much less information technology (IT). So it is very weird to end up as CIO at a Fortune 500. I tried a lot of things along the way, and I would encourage readers to do the same.

I started out doing some stuff in academia. I found that I wasn’t the right temperament for that type of job. I was preparing other people to go into battle while I was sitting on the sidelines. I wanted to take a more active role in my career; I wanted to be more of a practitioner than an investigator, which is what an academic is.

Since I lived in NYC, financial services were the big hometown industry, and I turned my attention to that. I wound up making many twists and turns along the way. I did not start off in IT proper, since I was interested in finance. Over time, however, the financial services industry and IT industry ended up converging. Every time I looked for a business opportunity or a business solution, it involved some form of IT. I got deeper and deeper into it, and I was more interested in the technology itself than sales and operations and other dimensions of the business world.

I was involved in technology in such a deep way, so deep that I decided to drop out, grow my ponytail, and start my own tech company. While this seems to be not so radical today, in the early stages of the first dot com boom, in 1999, it was very different and became a very interesting chapter of my career. I went from being a relatively senior executive with a full time secretary to running a startup where I had to fill a coffee pot myself. It was definitely a change in venue. I did that for 4-5 years and came up back into the big company world. It was definitely a shock to the system to be leaving and re-entering. The journey was long with twists and turns, and looking back, I overcame a lot of challenges.

BT: So with this journey, what do you think were some of the most difficult challenges that you’ve had to face?

MB: I would say that the biggest thing that readers will confront when they’re students growing up through the school system is that their lives are very well structured and programmed. And this imparts a feeling of control. One of the challenges is learning to understand that control only goes so far. Control is an illusion. After graduating and finding the right first job and making some progress in that job, life can still be interesting. Say you get along with your boss. But suddenly, your boss quits and you have a new boss, and you don’t like that boss, et cetera. Your bounce in your step everyday may not feel that way anymore, and you need to navigate around that.

Likewise, something might happen with the company that you work for, such as financial trouble, division in the company, or your company could get acquired. You may become redundant in the evolution of that particular business. Try to figure out how to manage and navigate change because it is inevitable and can undermine a comfortable sense of control. And you have found the right sort of niche.

BT: What traits do you think helped you most? And if you could offer advice to young people looking to break into business, what would they be?

MB: My perspective here is that most of them got to where they are (reasonably prestigious institutions) by being smart and hardworking. Being smart and hardworking is required in virtually everything you will do. However, playing the game at a certain level, at a sizeable company, doing a startup, entering a competitive field, you are going to find that being smart and hardworking are the price of admission. Everyone is the same. Everyone is smart and hardworking. So, while those are necessary traits, they may not be sufficient.

Traits that distinguish you from others are softer skills such as situational awareness. For example, are you aware of the situation and the stakes, biases, goals, and degree to which they are aligned or not aligned with yours. This is EQ rather than IQ. Those kinds of skills are the ones that enable one to be successful in a field where everyone is smart and hardworking. An example of this is being able to plant an idea in someone else’s head so that the idea becomes self-evident and you do not have to use brute force to get them to understand your viewpoint. From this comes flexibility, understanding the situation, and an ability to pivot. My point of view is that there may have been roadblocks, so you may have had to take a hard left or a hard right, but you may wind up in a different but better place.

An example of this flexibility is from when I started a company. I had to turn around a number of different constituencies where I had some relationship into another relationship. This is because raising money is difficult. Once we were in business, we were a software company, trying to complete with some desktop interactivity software. At the time, websites were not interactive, but we wanted to make them interactive like desktop applications and better than anything out there.

Yet Microsoft, the dominant player with Internet Explorer, was so ubiquitous. It was difficult to change their minds on web application experiences. I had to both pivot my thinking and my company. I decided to build business around in-flight entertainment systems that play movies and similar things. There was much less competition, and the competition was much less fierce as well, so we could do stuff that none of the incumbent players could do. This is still a successful business in practice today. Because I could pivot where there was a dominant player, and it was too crowded, into a place where the product was so unique, we could carve out a defendable niche.

This is like growing plants towards where there is light and air.

There is much in common for a similar thing at a larger company. Lessons from one experience can always be applied to another. An example of exogenous events that cause the need to pivot, was when I worked for a large commercial finance company doing well through 2007-8. However, it could not find funding for itself in the recession. We were fighting for lives, and we had to put the company into reorganization under bankruptcy. A non-bank became a bank; non regulated things became regulated; we had to shrink the size of the company and curtail growth initiatives to reorganize. There is a tradeoff between growing, innovating, and expanding, compared to making a company smaller and more compact.

In contrast, Ally was relatively constrained with respect to expansion, until Ally exited the TARP program, which led to rapid expansion, the complete opposite of the last company, creating multiple new products. Exogenous events can force a company into the same pivot situation, regardless of size. Change can go in many directions. Being able to pivot from one thing to become another thing is important. Evaluate the set of circumstances, and draw on those experiences and skills that are germane to the particular challenges of your company.

BT: As someone with over 25 years of executive leadership, what advice do you wish you had when you were an undergraduate student?

MB: I was not very good at listening to advice. Over time, there are two things that I wish I had appreciation for. They are completely contradictory. Learn to balance them. You really need to examine what your real passions are. Structured school experience lends itself to you studying things because you are good at it, moving forward one step after another. However, this may not really line up with your passions.

Think hard about what you are really passionate, what do you do when nobody is forcing you to do it, root your career in those sorts of things. This allows you to remain passionate throughout the rest of your life. Continue to be passionate.

At the same time, have a keener appreciation for the distinction between vocations and avocations. Just because you like to do something does not mean you should try to make money out of it. Sometimes, the commercialization of it can kill the joy in it. Keep it as a hobby, not as a vocation. The contradiction comes in here. How will you keep two conflicting impulses in balance.