Global Insurance Giant

Limited agility and rising costs

In recent decades, the insurance provider has grown both organically and through acquisitions, and with it, so too has its mainframe infrastructure. Yet this complexity has hampered its IT agility and ability to incorporate modern technologies such as GenAI, which power the kinds of next-generation experiences customers expect. In addition, it prevented the company from moving away from increasingly outdated operations, such as batch processing.

Beyond agility considerations, the company also saw its mainframe-related costs rise rapidly. Maintenance costs surged with every new contract with mainframe software and hardware vendors – an increasingly common concern for financial services providers, who continue to rely on the technology for mission-critical processing.

When the provider wanted to add mainframe talent, it faced yet another daunting challenge: Most younger IT talent viewed 30-year-old systems as a career dead end, while its pool of mainframe specialists continued to shrink each year due to retirement. In response, company leaders realized that it was also imperative to modernize its mainframes before it became impossible to hire specialists.

Choosing the right modernization partner

The company’s IT leaders initiated a search for a mainframe modernization partner – looking for vendor who could perform rapid, reliable, and automated refactoring of outdated code into modern languages, followed by migration to a public cloud environment. The selection team contacted several big-name IT service providers, which over the course of two years, resulted in numerous conversations.

Several problems emerged. The vendors were offering cookie-cutter refactoring processes, rather than customized approaches tailored to the company’s specific needs. Moreover, each option would force them into a process that required either extended code freezes or time-consuming processes for incorporating new code.

Faster automated modernization

Ultimately, the insurance company executives met with Amdocs, who shared their insights and experiences achieving modernization success. Core to this was their use of refactored applications to deliver either equal or better performance, with similar or reduced maintenance effort to maximize cost efficiencies. To achieve these objectives, they would automate at least 99% of the refactoring process for schedule control and to avoid an extended code freeze period.

The insurance provider asked how Amdocs could deliver on these objectives for their organization. In response, Amdocs pointed to their automated refactoring solution and unique IP that eliminates extended code freezes.

Having completed more than 300 modernization projects, they explained how their proven approach includes customization for each mainframe’s specific environment, enabling it to deliver effective modernization at scale – with flexibility, experience, and technology driving the automated legacy code conversion process.

Proof reinforced by a second opinion

Amdocs offered to demonstrate its abilities by converting five million lines of code over a weekend. In response, the insurance provider provided a code sample late Friday afternoon, which by Monday, was already converted into Java. Impressed, they then commissioned Amdocs for a proof-of-concept project, which they subsequently built by refactoring one of the company’s applications, delivering functional equivalency.

In response, the insurance provider commissioned consulting firm McKinsey & Company to evaluate Amdocs’ technology and proposed methodology. After a thorough review, the firm recommended that the company accept Amdocs’ proposal to modernize six mainframe systems over a multi-year engagement. Subsequently, the provider engaged Amdocs with confidence that it was choosing the right partner.

Rapid progress with a modernization factory

Amdocs is today in the process of modernizing the provider’s six mainframe systems. This is being done via a phased approach, which began by establishing a modernization factory to drive the automated refactoring process. The scope includes refactoring applications in more than 10 outdated programming languages into modern, object-oriented languages, primarily Java.

Beyond refactoring and modernizing the applications, the team will consolidate multiple data models into one relational model. As a final step, each modernized system will be migrated to the provider’s preferred public cloud environment.

The insurance provider expects to realize significant cost savings as soon as 18 months from the project start date – when the first of its six systems will complete modernization and migration to the cloud. As its mainframe experts retire, the company will be able to tap into the large talent pool of developers who use modern, object-oriented programming languages.

Equally important, they will be able to take full advantage of the cloud for elasticity and resilience, while being better positioned to adopt advanced analytics and GenAI. Furthermore, outdated systems will no longer slow innovation, freeing business teams to experiment with ideas and enhance the customer experience.

More modernization ahead

While Amdocs expects to complete the modernization in about three years, it’s unlikely to be the end of the journey. The customer has already identified two mainframe systems at acquired companies to be modernized, and they plan to turn to Amdocs as their modernization and cloud migration partner to bring agility and cost savings to those systems, too.

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