GM Pulls Ahead Opening of Fourth IT Center

General Motors says it will open its fourth and final U.S. information technology center in Arizona, an announcement marking a key milestone in the transformation of its IT resources to a captured unit after decades of outsourcing the work.

The so-called IT Innovation Center in Chandler, AZ, will staff 1,000 IT professionals and business analysts, joining previously announced locations in Warren, MI; Roswell, GA; and Austin, TX. The centers, GM says, are strategically placed to recruit new talent out of nearby IT-rich universities, as well as seasoned professionals.

Once the hiring in Chandler concludes later this year, GM’s in-house IT staff will expand from 1,500 employees one year ago to 5,500. The auto maker ultimately wants a captive IT staff of about 9,000. That figure includes 3,000 staffers from Hewlett-Packard that GM hired after quitting its support contract with the IT provider last year.

The two companies recently announced another major contract related to GM’s IT transformation, in which the auto maker purchased one of the industry’s biggest software packages for global deployment.

In addition to hiring for the IT centers, GM also wants to add a second enterprise data center. The auto maker already has opened one on the campus of its Warren research and development headquarters outside Detroit and reportedly is near to announcing a second site on its proving-grounds campus in nearby Milford, MI.

GM is consolidating its data centers to two locations from 23 previously.

GM’s decision to bring its IT operations in-house last year was seen as a landmark move by the auto maker, or for any major U.S. corporation, because of its scale and the fact that for years the common practice was to outsource such services.

Randy Mott, GM’s chief information officer, says the IT unit’s transformation is proceeding rapidly. “We’re actually a little ahead of what our original (deadline) goals were,” Mott tells journalists in a conference call today.

“We still have a long ways to go, but these (IT centers) are the key ingredients to allow us to drive” the transformation, says Mott, who joined GM from Hewlett Packard last year to lead the transformation.

The four GM IT centers will support all aspects of the auto maker’s existing and future global business operations, from Internet-based work to dealer and manufacturing systems and vehicle technology.

GM says the talent it seeks to staff the IT centers will have a range of capabilities, such as software development, database administration and system analysis.

The auto maker’s IT transformation will reduce 40% of its software applications to common processes and automate some tasks currently being performed manually.

GM’s IT move in-house is seen as unique for another reason: None of the sites it has chosen for the IT centers are located in California’s Silicon Valley, considered the world capital of software development.

“We’re looking at the quality of life for the (employees), and part of that is cost of living,” says Mott, whose former employer Hewlett Packard was founded there.

“We think this (having regional centers) is a better balance. Most people in Silicon Valley didn’t come from there, so there’s not a lock on innovation there. It just happens to be a collection point.”

GM will lease space in Chandler until sometime next year, when a $21 million complex is ready for the group.

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