You could learn a lot from a CIO with a $17B IT budget

Lori Beer, global CIO at JPMorgan Chase, oversees a massive IT operation that’s bigger than many companies. It involves a 63,000-person team worldwide and a $17 billion yearly budget (at last count), which was about 10% of JPMorgan’s overall revenue last year. It’s moving $10 trillion (that’s a 10 with 12 zeros after it) every single day and is the largest U.S. bank in terms of deposits and online customers.

That’s serious scale involving massive cloud infrastructure services, on-prem data centers, mobile infrastructure, and other assorted digital technology just to run the transactions part of the bank, never mind the rest of the business. It requires a person with tremendous attention to detail to make sure it’s running smoothly, securely and efficiently.

“If you think about just our markets business, the high-speed, real-time processing of those types of things where fractions of seconds matter, that’s all technology driven,” she said.

It takes a huge amount of money and requires building front-end services for customers and back-end services for the company. It needs on-prem data centers and cloud services. It requires innovative startups and reliable, established companies. It demands an operating budget to run in the present and an innovation budget that looks forward to what’s coming.

It’s a case study for every CIO out there, most of whom will never come close to JPMorgan Chase’s scale but who can still learn from how it goes about its business.

Tracking a huge tech ecosystem

“We move $10 trillion a day, and we’ve seen growth in that business. So there is a direct correlation to our tech investments, our products and services, our tech. So there’s just the normal business growth, and then there’s the continued optimization of how we use infrastructure and things like that,” Beer told TechCrunch.

Unsurprisingly, the company is looking at how AI can help manage all this and provide a better customer experience, adding another layer of complexity that every CIO is dealing with these days.

“Then, of course, there’s the new technologies. I mean, AI — as you well know, you wrote about it — is great and is driving a whole new set of volume-driven, compute-related costs, and we’re leaning hard into that,” she said.

When she speaks, she resembles in some ways Amazon CEO Andy Jassy. When he was in charge of Amazon Web Services, he had an almost encyclopedic knowledge of the company’s large number of products and services and would speak about them in great detail as though he were seeing a screen in front of him with the information. Beer is the same way, talking about her company’s highly complex technology ecosystem with ease and ticking off all the different areas she has to track and be aware of.

That’s an important aspect of her role: understanding the interconnectedness of all the different parts of her IT budget and how each one affects the others as she builds and maintains the bank’s vast technology stack.

“You can’t really start talking about AI if you’re not in the cloud, if you’re not modernizing your data, if you’re not doing all the foundational stuff,” she said. That has put the bank on an aggressive modernization journey based on a hybrid strategy. Some of the more critical services are running on prem in very sophisticated data centers the company built to handle its unique demands, and some are running in the cloud with the main cloud vendors: Amazon, Microsoft and Google.

And she actually made sure JPMorgan was well set up for generative AI several years before it burst into the mainstream, making sure the company had its data house in order so it could work with large language models. “It was over three years ago that we laid out an AI data strategy and AI strategy,” she said. That involved forming an operating committee to align the data strategy and cloud strategy in part because the most advanced data management capabilities are in the cloud. “So we sort of got a bit ahead of that train,” she said.

Setting up resilient systems

When you have such a sprawling IT infrastructure, it’s more important than ever to have systems of control in place to help manage it all. That requires a framework and a way of working with every service the company provides.

“First and foremost, we have to think about it in the context of: What is the resiliency standard, the essential service, that I need to provide. In some cases, if I have an application or workload that’s not an essential service, moving to the cloud is a lot easier, right? If I have something that requires the highest [level] of resiliency, maybe I run those things in my highly efficient, highly effective, highly protected data centers,” she said.

That means working with the engineers, developers and IT professionals to help them understand the way the company works and adhering to a set of clearly defined standards. “We continue to teach our teams to understand, whether it’s on prem or in the cloud, teaching the engineers how to be accountable for the cost, the security, the scalability and the efficiency of how we build software and leverage infrastructure.”

The company also works with a number of startups to tap into their innovations; Beer has a whole team dedicated to looking for the next big things. “The reason that’s important is we’re so big, at such size and scale, and their whole job is to constantly look at new companies, the evolution of companies, and so at any point in time, we probably have like 200 POCs [proofs of concept] going on. We are continuing to test and learn and we’re in a position to be able to do best in breed, whether it’s cyber technology or something else,” she said.

For Beer, every decision has to involve a timeline to value. Projects with more immediacy have a timeline of one to three years, while projects that require more time to bake get a three- to five-year time horizon. That could include things like the blockchain, AI and even quantum computing, as the company looks for any edge it can get in terms of services provided and efficiencies it can gain.

“We also have to invest in the next horizon, things that are adding value, things where maybe the value is uncertain, but we have to keep looking forward, and we really try to balance our investments across those things.”