Bright Spots in Shifting Market

Microsoft’s New GM of U.S. Financial Services Colleen Healy
Sees Big Opportunities for Financial Firms in Lean Times

Last year, when Colleen Healy was Microsoft’s general manager of investor relations and spending lots of time every day with portfolio managers, she spent much time talking with analysts about risky asset-backed instruments issued by U.S.-based financial services companies.

“Now a year later, investors and everyone see that this dislocation was not just confined to funny-sounding instruments with acronyms issued by U.S. banks, but rather in the worldwide economy now impacting all industries,” says Healy, who in August departed from her Investor Relations role to become general manager of Microsoft’s U.S. Financial Services Group.

Microsoft is well positioned in today’s market because its commitment to research and development in the form of a $9 billion R&D budget means it has resources available for uncovering opportunities as business paradigms shift. For the financial firms that she is reaching out to in her new role, Healy sees even bigger opportunity, as forward-thinking firms decide to innovate and take leading roles in moving the industry forward.

“It’s really a land grab for our customers out there, whether it’s fostering loyalty among insurance customers or securing more deposits as a bank,” Healy says. “When I look back at the prior period of dislocation, the tech dislocation of 2000 or 2001, it was a period when Microsoft focused on innovation. When we came out of the recession, Microsoft was really able to build end-to-end solutions not only for the enterprise but also for the consumer.”

Healy is comfortable in her shoes as the head of the U.S. Financial Services Group, not only because of her experience weathering different periods of economic expansion and retraction but also because of her career in which she has worn many hats as both a client and vendor in the financial services space. Having previously managed a portfolio, she has a firsthand familiarity with the intricacies of Monte Carlo simulations and other risk management techniques. In fact, while at Credit Suisse First Boston, she worked on mergers and acquisitions and public capital underwritings. She even sold insurance for State Farm to pay her way through college. 

Her team is similarly made up of industry veterans, a point that she expects will be a competitive advantage in today’s challenging market. 

“A core competency we bring to customers is being in a position as a partner who can represent the entire landscape of the industry, with depth and breadth of insights and business approaches for working through this period of dislocation with industry knowledge and gravitas,” she says.

That breadth of perspective also comes with an awareness of how the different segments of the financial services industry are interrelated. 

“If you are a CFO of an insurance company focused on writing policies, you are not only concerned with whether risk is being priced appropriately, but also whether you are able to translate those invested insurance premiums to money in the capital markets,” says Healy, noting that a recent group meeting in Chicago explored addressing this interconnectedness among other issues.

From a technology perspective, Healy sees advantage for Microsoft in its cost structure, its investment in newer technologies such as cloud computing, business intelligence, high-performance computing and unified communications, and its overall interoperability.

“We have a lot to offer in terms of cost,” she says. “Microsoft has always been the high volume, high-value alternative, where you didn’t need a Ph.D to run business intelligence or Excel. And this business model is increasingly relevant during these times.”

Meanwhile, Microsoft’s strong investment in business intelligence and CRM can help firms find cross-sell opportunities, spot customer needs more quickly and boost customer retention by ensuring complete and up-to-date views of the customer are presented at every touchpoint. Today, that includes traditional touchpoints, as well as newer methods of doing business, including instant messaging and mobile technology.

In terms of interoperability, Microsoft has evolved and is able to play a seamless role in a heterogeneous environment, she notes. “The world has changed and we want to work with what is comfortable for our customers. As evidence, look at our growing relationships with Sun and Novell, players Microsoft might have once never partnered with. The industry advantage here is meeting customer needs with an industry-specific solution that works within the ecosystem selected by the customer,” Healy says. That ecosystem includes presenting customers with the choice of buying licenses and installing software in-house, or having it hosted by either Microsoft or another third-party in the “cloud.”

As far as the future, Healy says the U.S. Financial Services Group has seen nice growth for the first half of its fiscal year, which ends June 30. “I expect we will be able to continue with an impressive portfolio of products that resonate with businesses and their customers,” she says.

She is also optimistic about the industry as a whole: “After the last market dislocations in each of the prior two decades that started in the financial services space, the economy emerged stronger,” she says. “I find an interesting combination of smart, fun, creative people at the intersection of financial services and technology. When you put that brainpower to work, you will find an innovative way forward.”