Making Lemonade

Tom Mannix never wants to live through something like Y2K again. Dealing with line after line of undocumented code gave the director of The Guardian's year 2000 project a new religion: From this day forward, no one -- absolutely, no one -- will be able to upgrade or alter an application at The Guardian Life Insurance Co. of America without documenting what he or she did and why.

In the understaffed, overworked world of IT, new systems are needed long before the IT staff can implement them. When they are finally rolled out, it's often a quick-and-dirty deployment. No time to document the change or communicate it to others. At New York City-based Guardian, Mannix and his team encountered the fallout from this situation frequently. IT staffers were not notifying colleagues when applications and services were changed, says Mannix, the director of corporate online systems. "Our support center would get a call saying that something that worked yesterday wasn't working today." Y2K was not only a wake-up call for Mannix, it was an unprecedented opportunity to lay the groundwork for a new era of organized growth.

Y2K is the biggest project, both in scope and cost, that CIOs have ever had to tackle. But even a cloud this dreary has a silver lining. For all its attendant aggravation, Y2K brought unexpected advantages to CIOs. It has given IT a higher profile within executive management; a host of new systems, skills and proficiencies; and an opportunity to make a fresh start. Smart CIOs are using what they learned from Y2K as a launchpad for more efficient operations -- essentially transforming a catastrophe into an epiphany.

Lesson 1 -- Managing Source Code

What complicated remediation for a lot of CIOs was years of accumulated spaghetti code. Encountering code that had been jiggered and updated and patched so many times, no one knew how one Y2K-related change would affect a previously smooth process. Although many CIOs chuckle at the suggestion that companies will be starting 2000 with clean code, others have been carefully inserting documentation into their renovated code so that the next programmer will always be able to go back and look at what their predecessors did. And like Mannix, they're insisting on better source-code management so that the next time there's a grand remediation (think euro or eight-digit phone numbers), it won't be like walking into a jungle without a machete.

After remediating its systems, Guardian's Y2K project team implemented an enterprisewide cross-reference database from Kildeer, Illinois -based Effectek Consulting Corporation for all the company's systems and applications. Every upgrade and change now has to go through Change Man, a change-management tool from Serena Software Inc. in Burlingame, Calif., before it can go into production. The source code, the object code and all the infrastructure requirements are carefully documented, and then Change Man notifies the database staff of the update. In addition, Mannix and his group can now model changes prior to an actual upgrade to see what the impact would be across the company, a move that is likely to short-circuit many a panicked call to technical support.

Lesson 2 -- Managing Inventory and Assets

An apocryphal story: When calculating its Y2K remediation schedule, one major corporation estimated it had 50,000 PCs; imagine the CIO's surprise when an inventory revealed it actually had 75,000. Wading into the Y2K waters, many CIOs discovered they had no idea either what systems the company had or what applications were running on them. "Geetting our arms around the number of different applications and PCs and creating a plan was difficult," recalls George Boersma, CIO for the state of Michigan in Lansing. It wasn't something that the IT group was used to doing, simply because nobody had ever thought that it was important.

Boersma's group does it now. As the Michigan IT group moves forward with e-commerce initiatives, they find that the new applications involve integrating data from many more systems than previous projects did. Having the inventory allows the group to map out the different systems that are involved and accommodate them. Each of the 19 state agencies now have an inventory of all their applications. Because the IT group will have a better sense at the outset of how much integration is necessary, Boersma anticipates projects will run more smoothly with fewer surprises.

In addition to the organizational benefits, asset tracking enables smarter investment decisions. At Morristown, N.J.-based AlliedSignal Inc., Y2K remediation included a portfolio management program (from Edison, N.J.- based DMR Consulting Group Inc.) to track hardware and application assets. Its continued use allows the IT group not only to understand what kinds of systems they currently support, their age and origin, but also to enable usage of those systems across the enterprise to maximize their value. According to Jack Arnold, AlliedSignal's vice president of systems transition, different business units now share compatible systems. Before the program was implemented, the company had no idea how to orchestrate that type of sharing; the result is lower administration costs and better utilization of current systems without paying for upgrades or new machines. Arnold is also planning on using its asset inventory system to renegotiate maintenance agreements -- because for the first time AlliedSignal has quantitative data on how much equipment is in the company.

Lesson 3 -- Managing Projects

Project management is not a skill for which IT has historically been famous. However, the size, scope and expense of remediation highlighted the need for project management -- tracking progress and resources over time -- for many CIOs and their bosses.

In Michigan, CIO Boersma learned that project management works best when the corporate hierarchy isn't constantly derailing the efforts of project leaders. Boersma is quick to caution that business should always be the driver of project work and IT the enabler, but his staff learned through Y2K that there are times when IT work must take precedence in order to achieve a business objective. For the first post-Y2K project, a statewide HR system, as well as for future IT projects, Boersma is retaining what he calls the "green, yellow, red" traffic-light approach he used in Y2K. A green score indicates a project is on track. A yellow score flags potential problems. A red score means a project is behind, and the executive in charge of that agency and Boersma must hammer out a way to get the project back on schedule.

Boersma notes that this technique keeps executives keenly aware of where they stand with their projects, and the uniform application of this procedure has added credibility to the IT department's efforts. At the same time, based on its success with Y2K, Boersma's staff is developing a consistent methodology for managing large IT projects. It incorporates repeatable best practices, such as the best methods for reporting status, putting together a project plan and designating individual responsibilities.

Lesson 4 -- Managing Relationships

Y2K unexpectedly exposed IS and business staff to each other's job roles to an unprecedented extent. The experience taught both groups valuable lessons that will make them better partners in the future.

Thomas Roza, change manager at The Gymboree Corp., the children's clothing retailer in Burlingame, Calif., says, "Y2K gave us the opportunity to show that we know what we're talking about, and we can find the right business solutions if they give us a chance." Case in point: When Zutopia (a division that makes clothing for children ages 7 to 16) first created an e-commerce site, it did it with very little help from the IT group. When the executives at Zutopia became unhappy with the results, they went to IS for help redesigning the site, something Roza believes would not have happened prior to Y2K.

On the flip side, the IT group gained insight as well. Working on Y2K contingency planning with business folks helped the IT group realize how intertwined the two worlds are. "The Y2K project exposed an absence of a business strategy within the IT group," he says. "In the event there is a disaster of any kind -- natural, environmental or economic -- what would we do if we couldn't get to the computing facilities? How would we keep the business running?" The IT group has taken this knowledge and used it to institute new fail-over procedures for the processing system as well as to improve a backup system to decrease the amount of downtime.

Even in government organizations made up of discrete agencies, Y2K improved relationships. When Elias S. Cortez moved from being the CIO of San Bernardino County (California's largest) to being the state CIO in Sacramento, he decided that the only way to conduct an effective statewide project would be to get rid of the stovepipe structure that had characterized previous large-scale initiatives. Cortez worked with Bellevue, Wash.-based Data Dimensions Inc. on risk management issues, and established a statewide Y2K office to oversee each agency's project. This enabled the state to throw additional manpower at mission-critical elements and coordinate across-the-board contingency plans.

Additionally, Cortez made it a priority to form personal relationships with state government leaders as well as local governments. As IT workers across the state begin to look beyond Y2K, he says, "projects are being looked at from the vision and perspective of an enterprise solution rather than a department solution." For example, the state has established cooperative relationships between the IT data centers in different agencies that allow for the sharing of technical and personnel resources so that the state's most critical projects can be completed in a timely manner. This type of interdepartmental collaboration is largely unprecedented for the state.

Lesson 5 -- Managing partners

Y2K strengthened more than internal relationships. Many companies got to know their vendors and partners well -- better than they wanted to in some cases.

As the largest payroll operator in the world, Automatic Data Processing Inc. faced the daunting Y2K challenge of keeping the paychecks rolling out to 26 million workers worldwide. In addition, it relies on 630 third-party vendors for over 2,000 products; James Kinder, vice president of information technology for the Roseland, N.J., company, was adamant about maintaining those relationships even in cases where the vendors were behind on their Y2K projects. Instead of merely shuttling compliance letters, ADP maintained strong lines of communication with its vendors, to the point of volunteering to act as a guinea pig for alpha versions of remediated software in ADP's own Y2K-ready systems.

Kinder found this mutually beneficial because it broke down barriers and created trust between the companies. ADP's recognition of the symbiotic relationship with its vendors also brought both of the company's Y2K projects closer to successful completion. (One of its vendor's Y2K projects was so far behind that ADP actually took in its code and fixed it.) Now that the company is working with many of the same vendors on the question of euro conversion (the younger sibling of Y2K conversion), Kinder's group finds the relationships a lot smoother.

The Long-Term Payoff

For years, IT has waited for business executives to realize the fundamental importance of technology to business. While it might be Pollyanna-esque to suggest that Y2K drove the point home once and for all, it certainly struck a blow for the cause.

Tom Mannix at Guardian feels that the visibility the Y2K project gave IT is an asset that's going to pay off in the long term. "The new tools, procedures, workflows and controls will help us produce a product quicker, better and more efficiently," he says. "It has finally opened the eyes of business folks to the fact that data processing is the lifeblood of the business." The people who come to Mannix and his group now have a better perception of what data processing can offer, and he is seeing a great deal more working cooperation between the data processing and business lines. We're in it together now," he adds, "as opposed to just being a service that they need."

This story, "Making Lemonade" was originally published by CIO.

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