Infosys Uses 20+ Years of Mainframe and Microsoft Experience  to Modernize Insurance and Financial Services Companies

For more than 20 years, Infosys (www.infosys.com/ microsoft) has delivered high-value client transformations that produce predictable results. Microsoft and Infosys share a commitment as partners to accelerating competitive impact for a customer’s business and its people. The Infosys Insurance Modernization Solution takes a business capability-driven approach, accelerating the migration process while leveraging existing IT assets.

We talked recently with Srikanth Srinivasan, head of insurance solutions consulting, and Prasad Joshi, who heads the Microsoft Center of Excellence within Infosys, discussing how their insurance modernization solution and global delivery model eases migration across all stages of the lifecycle.

WFS: Srikanth, how well is modernization understood within the insurance industry?

SS: Modernization means different things to different people. For example, in product development, it could be getting innovative products to market faster, meeting baby boomers’ retirement needs. For the IT side, it’s about moving from unsupported platforms and legacy apps to newer technologies that adapt to changing business requirements.

WFS: What’s the biggest challenge in undertaking a modernization effort?

SS: Delivering business value in a phased manner. Many modernization efforts are technology focused, consuming sizeable investments while creating little business value. Actually, even business-led modernization efforts may involve significant investment and business disruption over many years before benefits are realized.

WFS: Then how should you proceed?

SS: Business and IT executives should be committed first to a roadmap to acquire business capabilities required to achieve business goals. Developing a vision for business and technology in the end state is critical.

WFS: Why?

SS: To generate excitement and commitment. Then, projects will need to be prioritized based on their ability to deliver against the business capabilities.

WFS: How do you ensure you build and sustain momentum?

SS: By putting the right governance and project delivery teams in place to deliver against the roadmap. For example, we are helping a leading life insurance company develop and implement a modernization roadmap for their new business department. Starting with the long-term vision for the department and business capabilities to support that vision, the roadmap identified a series of standalone projects that would create business value while moving towards the vision. Initial projects focused on putting electronic case management in place and better collaboration with the field and requirement vendors. Three years since roadmap creation, the department achieved most of the medium-term business and IT goals and built the foundation to address the long-term vision.

WFS: Any pitfalls?

SS: Yes. Avoid jumping to the conclusion that the core transaction system, or systems, should be replaced. Adding the business process management and collaboration layers to underlying transaction systems typically creates significant business value.

Second, expect modernization to be a multi-stage journey. Having business value delivered at every stage of the journey is the best way to sustain commitment and funding for the effort.

Third, as I said earlier, build and maintain consensus across business and IT through the creation and implementation of the roadmap.

WFS: What kind of business impact can insurers expect?

SS: The industry today is under the influence of many forces that require new ways of doing business. Legacy systems built over a few decades prevent carriers from adapting to these changes quickly. Modernization can create IT systems that are flexible, user friendly and enable collaboration.

Competitively, modernization delivers advantages.

WFS: In what ways?

You can grow market share by rapidly introducing innovative products and products customized to emerging customer and geographical segments. You can lower cost of operations through greater automation, improved employee productivity and utilizing global talent.

WFS: Can you improve profitability?

SS: Yes, you can improve profitability by making smarter decisions through better information availability and analytics.

WFS: Thanks, Srikanth. Prasad, business issues aside, any technology inhibitors we should address?

PJ: Decision makers today face several issues. Costs associated with maintaining and upgrading legacy systems are high. There’s risk in running potentially unsupported hardware and software, as Srikanth said. We also see the retiring labor pool as a cause for concern. Couple them with expectations around multi-channel access to systems, personalization of information, anytime-anywhere access and flexibility for responding quickly to customer and market demands – well, it’s a strong case for legacy modernization.

WFS: What options do companies have to enable future state?

PJ: Several, such as SOA, which brings significant benefits connecting old with new. Modernization options now range from re-hosting, where you take the old footprint and host it on a modern platform, to reengineering, where you re-architect and develop the system. There are options that enable coexistence of old and new with some form of integration, such as screen scraping, Web-enablement, event-driven options and others.

WFS: The option that works best depends on the context.

PJ: Yes.

WFS: How do you see mainframes’ future role?

PJ: They clearly have a strong footprint across the insurance and financial services industries but with changing business demands, they inhibit companies from being responsive.

Companies need alternatives. Low MIPS applications that do not need mainframe-class servers are candidates for moving off the mainframe. There are applications with characteristics that match the mainframe as a server and this is when you integrate the mainframe as a server in the modern environment. This requires modernization.

Also, remember that it’s not the platform but the architecture and design of older systems that must be revamped to meet user expectations.

WFS: What options do you recommend for modernization?

PJ: First, carry out portfolio analysis to decide the business case for modernization, which should point to what your modernization options are. For example, it’s cost-effective to re-host applications that consume smaller MIPS, re-engineering them to modern architecture over time. Based on the business case, if we decide to retain the mainframe as a high-performance server, we must review service-enabling the systems/apps, event-based options, etcetera.

WFS: What tools and techniques have you developed?

PJ: We invested in a full suite of tools developed internally and with our partners, including a suite for portfolio assessment and business case/ROI calculations. For insurance, we are building out business and technology capability reference models. We use tools to gather subjective information from users and use it with tools that glean information from code.

WFS: Have you also turned to your partners for different tools?

PJ: Yes, our partners also offer tools for identifying services, program understanding and capacity analysis.

WFS: How critical is SOA?

PJ: It’s an imperative to achieve flexibility in systems. Capability-driven modernization, as in insurance modernization, is based on creating services that can be orchestrated to create that business capability. Exposing legacy systems as services that are aggregated as processes and then combined to form the business process is the way to go.

Just as we routinely reconfigure business, we can reconfigure systems through services.

WFS: What best practices do you recommend?

PJ: Create a solid business case that leverages business benefits and portfolio analysis information. While quick wins are important, as Srikanth said, define a modernization roadmap. Pay attention to the coexistence of two systems for a period of time when modernization is underway. Equally important is change management. On the technology side, defining the architecture and standards is a must.

WFS: Success stories?

PJ: Yes, we modernized a portfolio of applications for a large corporation from an AS/400 to a Windows platform. We helped a prominent healthcare insurer identify reusable assets. And we’re currently helping two other organizations move from mainframes to .NET-based architecture.