One of Canada’s oldest property and casualty insurance firms recently completed the first phase of a mainframe migration project that it estimates will save it over $1 million a year.

Lombard Canada Ltd., which is headquartered

in Toronto, is in the midst of a company-wide initiative to migrate approximately 15 to 20 applications off of its mainframe system to Microsoft Windows Server 2003 operating system and SQL Server 2000. Lombard’s IT staff is working with Microsoft Canada, legacy application software maker Micro Focus and mainframe-based consulting company Cratos Technology Solutions Inc. Micro Focus Studio and Micro Focus Server will provide software to re-host mainframe applications and Cratos will contribute its technical expertise for the project, which will be completed next March.

Lombard’s mainframe system ran all of its insurance systems and was used by its 600 to 700 employees across Canada who keyed in data to create quotes and policies for clients and to report statistics to different agencies, according to the company.

Lombard early last month received its first sub-system back from Cratos that manages the Canadian Association of Retired People (CARP) system, said company assistant vice-president of business systems Glen Macgregor.

“We wanted to identify a sub-system that hit on all of the areas of our system as a whole that we can then use to set up infrastructure to maintain and develop that system,” said Macgregor.

To help facilitate the transition, Micro Focus in conjunction with Cratos and Microsoft have developed a step-by-step process with a series of checkpoints to ensure the project stays on track and that all business rules are in place, explained Cratos CEO Andrew Wickett. One of the first steps, for example, is a full inventory of the applications to determine how long they’ve been running on the mainframe and when the last time they were touched, he added. Once that’s completed, the next step involves targeting each of the components to figure out which ones need to be rewritten or replaced.

One of the biggest challenges in this part of the process is compatibility issues surrounding third-party software, said Wickett.

“If they’re using an older mainframe utility as a component of their mainframe solution, is there a comparable, compatible or similar product in the distributed platform?” said Wickett, adding a lot of companies, for example, use SAS on the mainframe to do reporting. “If they’re using something older like Easy Tree, there may not be a compatible version of that software.”

In phase one, about 92 per cent of the sub-system code remained intact, said Wickett. The other eight per cent was primarily due to migrating from DB2 to SQL databases in that reading SQL database on the distributed platform is different than on the mainframe system, he added.

The next part of the project, which is expected to be finished in July, will involve testing that sub-system and paralleling it with Lombard’s production system to make sure everything’s running smoothly and get staff familiar with the technology, said Macgregor.

Following that, Lombard will get its next sub-system that comprises its online systems for personal and commercial lines and for financial systems back from Cratos in mid-July.

Like many companies looking to move off legacy systems, cost was the driving factor behind Lombard’s decision, said Macgregor.

“We’re always trying to keep the percentage of what we bring in to what we spend on IT as low as possible,” said Macgregor, adding the software needed to run its applications was becoming more and more expensive. “When you compare that to the cost of the software in the server environment, that’s really what made up our minds to go that route.”

High cost of mainframe operations and upgrades is the number one reason customers are migrating off the mainframe, according to the Mainframe Migration Alliance (MMA). The MMA is an alliance of companies that provide information and tools to help IT organizations looking to migrate applications from the mainframe to the Windows platform.

After cost, lack of flexibility and agility is the second most compelling reason for companies to get off older technology, according to the MMA.

Typical recovery time on a mainframe system, for example, is 30 minutes to several hours depending on the severity of the issue, said Wickett.

“The recovery time, stability and performance of Windows is matching or exceeding those mainframe systems,” said Wickett. “The ongoing cost and initial cost is so much lower.”

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