A Journey of Legacy Modernization
Let’s face it, we all have it and probably don’t want to talk about it: legacy technology. It’s running our core business, and it is seemingly too unwieldy or too complex to replace. Every organization in existence has legacy technology. American Fidelity Assurance Company (AF) is no different. However, our business leaders chose to deal with it. Just how legacy was our legacy technology? To give you some perspective of our challenge, AF has been writing software since the 1960’s, some of which is still running. We had a significant amount of legacy technology, and it became imperative for us to transform to stay competitive in our market.
So what did we do? Several years ago, AF undertook the monumental task of eliminating legacy technology from our organization. More than 75 applications were identified as legacy, and the aggressive plan developed to solve the problem was a combination of purchased and in-house developed technologies. To date, 40 systems have been replaced, and the last, and largest, implementation to complete our overall transformation is well underway.
Ultimately, two key Oracle solutions were identified as part of our overall legacy modernization program: PeopleSoft and Oracle Insurance Policy Administration (OIPA). These two systems consolidated over half of the systems that needed to be replaced. PeopleSoft replaced all systems related to financial reporting and was implemented in 2014. OIPA will be implemented in five releases with the first scheduled for later this year. Our legacy system replacement will simplify complexity of system architecture, reduce data redundancy and improve availability, and will streamline and/or automate many business processes.
With the implementation of PeopleSoft and OIPA, our organization had the following key take-aways.
Know what you are looking for. It’s unrealistic to believe that any vendor solution can fulfill all organizational requirements, so it is important for the organization to understand what the “must-have” needs are before beginning any vendor solution search. Through using an outside organization to assist with the collection of business requirements, we gained the ability to clearly articulate the needs for a system, which ultimately allowed us to make a data-driven business decision in system selection.
Legacy system replacement will simplify complexity of system architecture, reduce data redundancy and improve availability, and will streamline and/or automate many business processes
Business process is key. Often, organizations want to find a system that fulfills current business processes. Resist this temptation. This seems to be the easy way to ensure successful system implementations; however, usually a significant amount of system customization is required to accomplish this goal, and in the end, customization leads to increased cost and longer future upgrade cycles. It’s important to emphasize that business process should adhere to the functionality of the system, instead of customizing the system to meet existing business process.
There is only one page…and everyone needs to get on it. Perhaps the most compelling factor to AF’s success in legacy modernization is that from executive to colleague, within the business and in IT, all agree and have buy-in on the direction of the program. We are all moving in the same direction toward the same goal. Everyone is willing and able to pitch in for the success of our projects.
Dedicate your resources. Your business and technology teams all have day jobs. Do not expect that they can dedicate time to a complex system conversion while also maintaining responsibility for day-to-day production. Free up their time so that they can be wholly dedicated to the mission of system implementation. Hire contractors or temps to perform team member’s prior duties. You will find that although this approach may seem to some to add additional, unwarranted cost, you will have a better outcome that is likely less expensive with a shorter duration in the long run.
Find an expert. Your organization, both business and IT, is not an expert on a new system, so don’t expect it to be. While evaluating systems, evaluate key implementation partners who can assist on your journey. In our systems transformation, we partnered with two external vendors for PeopleSoft and OIPA in order to leverage their experience in implementing these systems. The expertise they brought to the table was immense, and we had the advantage of their experience through many systems conversions with other customers.
Asking for change is hard. Not only is this a significant technology change, but it is a huge change on our colleagues. Systems changes of this size often strike fear in people simply because they do not understand how it will impact them. Be sure you have a robust, well thought out plan for people change management.
Large, enterprise system replacement is difficult and complex…there are many moving parts and many more details than you can even imagine at the outset. Know from the beginning that it’s not a day trip, but rather a journey. Prepare for the journey, learn from others along the way, and enjoy the success of arriving at your destination.
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