CME Eyes E-Business, Restructures Management; CIO Jenks and COO Beyers Quit

In an effort to better position itself to attack the e-Business arena and prepare for demutualization, the Chicago Mercantile Exchange has shaken up its management structure. Separately, Bill Jenks--the CME's executive v.p. and chief information officer--and Jerry Beyer--executive v.p. and chief operating officer--have resigned their posts.

The CME's restructuring, which took effect last week, called for the creation of a new management team consisting of nine managing directors. The MDs, who will represent each of the disciplines the exchange covers, will report to CME president and chief executive officer Jim McNulty, who orchestrated the reorg.

"In technology firms, you can't let things go up through several layers of management and then back down again, and then sideways….What you want to be able to do is just quickly drive things across your disciplines. And that's what we aim to do," explains McNulty.

One of the reasons that the CME is creating a "flat" management structure with "nimble" decision-making power, he says, is the exchange's planned for-profit ownership conversion. The Merc, of course, is still awaiting a ruling from the SEC on its demutualization application.

McNulty, however, also restructured the management team to position the exchange to attack new markets, like e-commerce. One of the new titles that McNulty created is MD of E-Business. Satish Nandapurkar, who most recently served as head of strategic solutions at Optimark Technologies, has slid into that role.

McNulty, who describes Nandapurkar as one of the 'best client-oriented technologists" he's ever worked with, says that the Merc sees a big opportunity to position itself as a "horizontal service provider" pandering to "vertical" B2B exchanges.

"I think there will be a lot of great B2B exchanges that are formed. They'll be global in a short period of time, and they'll probably be world class…. And the one thing that we can do as well or better than anybody is help them with their clearing, settlement and regulatory issues," he says.

But before the exchange starts to move in that direction, it will need to fill the void created by the departure of Jenks--who left the CME on March 24 to take over as executive v.p. and CIO of Heller Financial. During his tenure, Jenks, who joined the exchange in mid-1997, contributed to the enhancement of Globex2 and played an instrumental role in the development and rollout of the CME's Galax-C handheld devices.

McNulty, who says the Merc is now actively interviewing candidates to fill its CIO vacancy, declines to comment on why Jenks departed. But he says the CME is looking for someone with "good management skills" who is "very technologically savvy." The Merc would also like to find a candidate who has "entrepreneurial" vision and a wealth of "experience in dealing with outside vendors," says McNulty.

Meanwhile, after the scheduled April 12 exit of Beyer, the exchange plans to eliminate its COO title all together. McNulty declines to cite any reasons for the COO's resignation, and, at press time, it remained unclear where Beyer--who first joined the CME in1979--was headed. McNulty declines to say who will take over Beyer's responsibilities after the CME's COO title is abolished.

In addition to Nandapurkar and the yet-to-be-named replacement for Jenks, the CME's new management team consists of: Phupinder Gill, MD and president of the CME Clearing House Division; Craig Donohue, MD of business development and corporate/legal affairs; David Gomach, MD and chief financial officer; Donald Serpico, MD of operations; Amy Savin, MD and chief marketing officer; and Lewis Ting, MD of organizational development. The Merc also plans to appoint a MD of product development and sales in the future.