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Ameritrade CIO tackles TD Waterhouse buyout

27.01.2006
Ameritrade Holding Corp. completed its acquisition of TD Waterhouse Group Inc. Wednesday, creating a combined company known as TD Ameritrade Holding Corp. While the names were easy enough to merge, IT systems and personnel are another story. Jerry Bartlett, who was named Ameritrade's CIO in September, spoke with Computerworld about the challenges ahead and how he will face them.

Your two companies are about 1,000 miles apart. What integration issues will that cause? I don't view that as an issue. Ameritrade has legacy operations on the East Coast -- close to 100 technologists. We have already been operating in a dispersed mode anyway. What's kind of cool about TD Waterhouse is that their entire IT organization, with the exception of literally five people, is right across the street from our Jersey City location. So from a geographical standpoint, we don't view it as an issue in the least.

Ameritrade and Waterhouse are also worlds apart in what you do. How do you deal with that in terms of the integration? That's what led us to do the merger. Ameritrade's been known for the active trader space and TD Waterhouse has been known for accommodating the long-term investor and adviser space. Ameritrade's strategy has been to get into that space. By completing this acquisition, we feel we've advanced our strategy by a couple of years. We're in a position starting today to implement a client segmentation strategy that focuses on the active trader, the long-term investor and the adviser: one platform and one financial services firm.

So what's the biggest challenge in terms of the integration? It's making the personnel and culture things work well. The technologies are fairly similar. Two or three months ago, we already made the decisions on which systems were going to survive and which would be retired.

How many layoffs will result from this merger? Over the last three months, we went through an objective, performance-based assessment of all 800 technologists -- between the two combined firms -- and made decisions there. That's always the hard part. While a merger like this is great and wonderful things come out of it, there's always the downside: The economics drive negative impacts on some associates' lives.

Over the course of the next 18 months, we're going to go from 800 folks to about two-thirds of that. So about one-third of the IT staff will be leaving over the next 18 months. So getting these two teams to gel under new management... that's the tough part.