Ramon Richards spent two decades preparing to become the CIO of Fannie Mae
Some executives occupy the same position in several companies. They bring a strong toolkit to different environments and for a time help drive change for these companies. Other executives have several jobs in the same company. They get to know their business as well as anyone. As they reach leadership levels, they are well equipped to collaborate with and mentor those who have returned to their former responsibilities. They understand how the business works better than most. They have a great internal network to tap into to drive innovation. Ramon Richards is the latter type of frame.
Richards joined the $47.5 billion mortgage finance company Fannie Mae 23 years ago. Since then, he has held six positions before becoming CIO in August 2021:
- Director of development
- Director, Corporate Functions, Finance and General Ledger Systems
- Vice President, Finance Technology and Corporate Functions
- Vice President, Securitization and Credit Technology
- Senior Vice President, Securitization Technology and Services
- Senior Vice President, Integrated Technology Solutions
He admits he didn’t expect to stay with the company for more than two decades when he joined. He stayed, however, because he was able to learn and take on new opportunities. “During my journey, the work remained interesting and challenging and kept me fully engaged,” he noted. “Another big part of it, being in the tech world, you’re always learning, and learning was encouraged.” He also understands that Fannie Mae had huge benefits keeping an executive of his tenure in the fold for so long. “I am deeply connected to our mission and very motivated by what we do and how we try to improve access to housing,” said Richards. “I understand the culture and I am able to identify the opportunities available to us to continue to evolve as a company. I think it’s possible to connect the dots differently when you truly understand how all aspects of business work, from business to operations to technology, which has allowed me to influence maybe someone differently. ‘one who hasn’t spent as much time understanding the inner workings of the company.”
Richards and his team have led a tremendous digital transformation over the past few years. Emphasis was placed on developing the skills of the future so that his team could meet the demand for digital capabilities across the company. He also led to a reduction in legacy technology so that there was a better and less complex tech stack that he and the team managed. Agile practices have also been an important driver of change, as has the shift to greater emphasis on automation and cloud technology. Richards’ team is increasing the rate at which it can deliver software while reducing costs along the way.
The IT team now has a better foundation on which to innovate. To illustrate this innovation, Richards highlights an automated underwriting system his team helped set up to integrate a consistent rent payment history into credit scores. Long-term tenants who pay their rent monthly should establish their creditworthiness for what is usually the biggest bill of the month. And yet, this has generally not contributed to a creditworthiness assessment. This allows Fannie Mae to qualify more borrowers for mortgages. It’s an idea that seems almost obvious once explained, yet it’s a first of its kind in the industry. Considerable technological changes were necessary to allow this idea to flourish. “We leveraged some of our cloud capabilities as well as machine learning capabilities…to unlock rental payment history,” Richards said. “This is a major contribution to the company’s fundamental principle of increasing access to housing.”
The key to unlocking innovation at Fannie Mae is building a team that is curious and ambitious enough to want to develop the best ideas for the future. It starts with having the right training. “We have a program that we have established to develop the skills needed to become a full-stack engineer,” Richards said. “We also have a program in place to develop advanced cloud engineering skills. We also invest in leadership and management skills, because you need both to have a successful team. Moreover, his career path has become more rigorous for his colleagues. When an employee is ready for the next opportunity, suggesting other parts of the company can increase the likelihood of them staying rather than seeking that next opportunity outside the company. “In the type of talent market we find ourselves in today, it’s important to retain your individuals,” Richards emphasized. “We are very focused on finding new opportunities for individuals when they are ready for the next chapter in their career. It’s a much better answer for the company than the people who decide to leave.
This people-powered engine of innovation proved useful when the pandemic hit. Many Fannie Mae customers have been hit hard by the health crisis which quickly turned into a financial crisis for many. “Fortunately, we had made good progress on some of the digital capabilities we were developing, and we were able to leverage those capabilities to deliver payment deferral to the business faster than we had. provided this type of function in the past,” said Richards. “It became clear to us that the investment we were making in our digital core was important to how we wanted to operate as a business in the future. It was an early example of the potential, and I think it also helped motivate and inspire a lot of our people to set the business up for future success by providing products that would benefit landlords and tenants.
Richards is still having fun in his position as CIO and sees vast opportunities to continue innovating, learning new skills along the way.
Peter High is President of Métis Strategy, a business and IT consulting firm. He has written two bestselling books and his third, Getting to Nimble, came out recently. It also moderates the Technovation podcast series and speaks at conferences around the world. Follow him on Twitter @PeterAHigh.