On the heels of President Bush's speech last week, I think it's important to define exactly what a new direction means and why one is required. Simply ending the surge because we can no longer support the current troop level is not a new direction, it's just trying to use the same old failing plan in the hopes that it will succeed this time around.
What does this mean for the mortgage industry? Well, there are some clear cases in the news now where large corporations like IBM, Xerox and Adobe are making a play for mortgage again. However, they seem to understand the value of charting a new direction and have learned from there past mistakes, at least two of the three companies mentioned anyway. So, which of these three truly get it?
Well, both IBM and Xerox took a swing at mortgage before, found they couldn't make the profits they were after and exited the space for the most part. Now both companies are back in full force again. So, what is different this time around?
Both of these companies have learned that mortgage is a niche market with very specialized needs. A one-size-fits-all approach won't work. IBM and Xerox can't just push their products on mortgage lenders and expect to be taken seriously.
Both companies have realized their earlier folly and have chosen to align with mortgage technology specialists this time around. Instead of peddling IBM products to Countrywide, for example, IBM bought Palisades Technology Partners, a proven mortgage origination vendor, and FileNet, a proven imaging and content management mortgage player. IBM is integrating these services, retaining and/or increasing its staff of executives with actual mortgage experience, looking for synergies as to where IBM products can add value and going to market from there.
The story is very similar with Xerox. Xerox recently acquired workflow and e-collaboration vendor Advectis in its effort to re-enter the mortgage space. All Advectis employees will be retained, Xerox will look at other acquisition targets and offer a more integrated solution that draws on Xerox tools and indigenous mortgage technology tools as well.
Unfortunately, Adobe hasn't learned this lesson. Adobe has sought to push its own Intelligent PDF application onto lenders as an alternative to the Category One SMART Doc. Most vendors will say that they support both Adobe and Category One SMART Docs, but is there demand? At the Fiserv User Conference, executives were very pleased to say that they have customers very interested in e-lending that are piloting projects right now. Fiserv also reported that none of those clients are looking at Intelligent PDF even though Fiserv would support that direction if its clients were asking for it.
What's the overall lesson to take away from this blog? If you're smart you'll look to a new direction to better serve your objectives like Xerox and IBM did in looking to draw on industry expertise, and if you're not you'll just try to put some nice messaging around the same-old, same-old in hopes that it will take off, but we all know how that ends up, right?
PLEASE LEAVE YOUR COMMENTS BELOW. JOIN THE CONVERSATION. ALSO, BE SURE TO VISIT TECH NICHES REGULARLY AS IT WILL BE UPDATED EVERY TUESDAY WITH A NEW ENTRY. LET'S TALK ABOUT WHAT REALLY MATTERS PERTAINING TO MORTGAGE TECHNOLOGY.
