Inside GM’s Austin tech center, one of city’s many corporate innovation hubs

By   – Staff Writer, Austin Business Journal

It was a bold, but necessary step to keep pace in a global industry. About five years ago, executives at the Detroit headquarters of General Motors Co. chose to take information-technology operations, 90 percent of which had been outsourced, and turn them into “a core competency,” said David Caldwell, a corporate relations manager for the giant automaker.

“That’s extremely unusual in our industry,” he said.

Today, the Texas capital is home to the largest of GM’s four IT Innovation Centers, boasting more than 2,600 employees at its McCallen Pass and East Parmer Lane buildings, which measure more than 400,000 square feet and 280,000 square feet, respectively.

GM’s decision to place that key hub in Austin is one reason why the city is gaining a more national and global reputation as a center of innovation that is helping to attract similar tech-focused hubs from other industries. (The map below is a sampling of just some of the companies that have followed suit.)

GM’s (NYSE: GM) worldwide fulltime IT workforce totals 9,500, more than 5 percent of its overall headcount of 180,000.

Unlike some companies that create internal tech hubs, GM doesn’t differentiate locations by function. Instead all IT activities — such as Galileo, a proprietary cloud-computing platform; machine learning; data analytics; and, its electric-vehicle Maven Gig service — exist at all four innovation centers, said Randy Mott, senior vice president for global information.

The 2013 strategic move reduced GM’s IT run rate by $190 million, Mott said. What’s more, it allowed the company to retire 3,777 software applications. The IT team currently supports 2,750 applications.

Mott said bringing IT in-house also increased the company’s recruiting capability.

Among the technologies that Austin-based GM employees have worked on are apps for company brands such as Chevrolet and a project announced in April that allows Amazon Prime members to receive package deliveries to their vehicles.

Arizona, Georgia and Michigan host the other GM tech hubs, which like the one in Austin are all within a few hundred miles of multiple universities that graduate students with IT degrees. New hires may choose to work at any of the four tech-hub locations.

School flags hang from the ceiling over alums’ desks throughout the GM IT Innovation Center. Cultivation of a college-like atmosphere is intentional, said Sue Brann, IT executive director and chief administration officer.

“It helps retention,” Brann said.

The final move-in by General Motors into its building on McCallen Pass earlier this month marked the Austin culmination of that decision made by the company back in 2013.

Mott said he and his colleagues strive for a healthy mix of recent grads and seasoned veterans — who share their expertise. An optimal balance is one where the younger employees seek to do the impossible because they don’t know any better, and the older compete with them because “they want to win,” Mott said.

Ninety-nine percent of employee losses due to attrition are filled with recent grad hires, he said. The graduate hires account for more than 1,300 of the Austin IT Innovation Center workforce.

The Burt Group is a leading Austin-based commercial general contracting firm.