Although it may not always make sense to promote internalcandidates to the CIO position, Principal Financial Group CIO GaryScholten believes companies can reap enormous advantages when a strong match exists.

“Because I had the opportunity to work in all our business unitsbefore becoming CIO, I had firsthand experience within the businessitself as well as key technology areas,” says Scholten. “Eventhough the technology has changed, most of the time I can relate itto something we've done in the past, which helps when dealing withthe complexity of our business and technology.”

Principal Financial Group is a global Fortune 500 companyoffering a range of financial products, life and health insurance,and banking services to more than 18.9 million customers worldwide.Scholten began working for the company 30 years ago aftergraduating from college. He started as an entry-level programmerand worked his way up the IT ladder, serving as CIO of multiplebusiness units before being promoted to senior vice president andCIO in 2002.

“I am living proof of the ability to learn and move throughout the company,” Scholten contends. “The fact Ihad IT experience in all our business units was important to mydevelopment, providing both formal and informal educationalopportunities.”

That experience has proven instrumental in helping Scholtensteer the company's numerous IT projects and oversee an IT staff ofmore than 2,300 professionals. Of those IT employees, about 450work in non-U.S. locations, primarily in India, Latin America, andAsia. Operating under a federated model, each of the company'sseven business units has its own CIO who reports to Scholten aswell as the head of their specific business group.

Under Scholten's leadership, The Principal has received numerousawards for technology innovation. Scholten attributes the accoladesto a talented IT team as well as strong support from topexecutives.

Among the IT projects currently on Scholten's plate: developingsolutions for the company's recently launched America Rebuildscampaign. As the country recovers from the recent recession, peopleare reassessing their own finances. At the heart of The Principal'scampaign is an online hub that offers educational tools and videos,guidance from third-party advisors, and financial tips. To helpfinancial advisors better meet their customers' needs, Scholten andhis team also recently rolled out data analytic solutions andmobile applications with real-time compensation tools.

In addition, The Principal was one of the first companies toprovide its clients with the ability to electronically submit U.S.Labor Department regulatory requirement forms for 401(k) plans.Scholten says the ability to submit these forms online gives thecompany a competitive advantage and was instrumental in winningover a new large client.

Other IT projects include analyzing employees' use of laptopsand desktops, underlying applications, and operating systems inpreparation for a companywide replacement.

“Over the next 2 1/2 years, we'll be replacing all of ouremployees' computers, so we're taking the time to step back andlook holistically at what's the right way to leverage thisopportunity,” Scholten explains.

The IT department also is looking at ways to help The Principalbecome a greener environment by providing products and servicesonline. “Rather than just deciding to no longer offer printdocuments, we're looking for the best opportunities to leveragetechnology in a way that provides additional value for ourcustomers,” Scholten says.

A third IT project is focusing on “right-sized highavailability,” which Scholten explains is identifying whichapplications need high accessibility and short recovery times andwhich have less stringent needs.

Scholten, who earned a degree in math and computer science fromthe University of Northern Iowa, joined The Principal in 1980.During his 30-year tenure, he has seen tremendous changes in bothtechnology and the role of IT at the company.

“When I think back to the '80s and early '90s, IT primarilyinteracted with operations, customer service, and finance,” hesays. “Over the years, the role of IT has changed beyond that.Technology still plays a role in getting the most efficiency out ofour business processes, but it's more integrated with the business,which has opened new constituencies for us to work with.”

Sharon Baker is a freelance business writer based in Charlotte,N.C.