IT Consolidation and Best Practices Along with ALM 11 fromHP help AIG in Worldwide EnterpriseTranscript of a sponsored BrieﬁngsDirect podcast, part of a series on application lifecyclemanagement and HP ALM 11 from the HP Software Universe 2010 conference in Barcelona,Spain.Listen to the podcast. Find it on iTunes/iPod and Podcast.com. Download the transcript. Sponsor:HPDana Gardner: Hello, and welcome to a special BrieﬁngsDirect podcast series coming to you from the HP Software Universe 2010 Conference in Barcelona. Were here in the week of November 29, 2010 to explore some major enterprise software and solutions, trends and innovations making news across HP’s ecosystem of customers, partners, and developers. [See more on HPs new ALM 11 offerings.]Im Dana Gardner, Principal Analyst at Interarbor Solutions, and Ill be your host throughout thisseries of HP sponsored Software Universe Live Discussions. [Disclosure: HP is a sponsor ofBrieﬁngsDirect podcasts.]Our customer case study today focuses on AIG Chartis Insurance and how their business hasbeneﬁted from ongoing application transformation and modernization projects.To learn more about AIG Chartis Insurance’s innovative use of IT consolidation and application’slifecycle best practices, please join me in welcoming Abe Naguib, the Director of GlobalPerformance Architecture and Infrastructure Engineering at AIG Chartis Insurance in Jersey City,New Jersey. Welcome to the show, Abe.Abe Naguib: Hello, Dana. Nice to be here.Gardner: Abe, tell me a little bit about the scope of your organization and the type ofapplications activities that you are undergoing and why moving towards some newer productsmade sense?Naguib: Let me step back for a second, Dana, and give you a background on AIG and itsapplications. AIG is a global insurance ﬁrm, supporting worldwide international insurance ofdifferent varieties.Were structured with 1,500 companies and roughly about eight lines of businesses that managethose companies. Each group has their own CIO, CTO, COO structure, and I report to the globalCTO.
What we look at is supporting their global architecture and performance behavioristics, if you will. One of the key things is how to federate the enterprise in terms of architecture and performance, so that we can standardize the swing over into the Java world, as well as middleware and economy of scale. Gardner: Given the breadth and depth of the organization, where are you in terms of your applications? What are some of your goals in terms of improving how things are done?Proliferation of middlewareNaguib: I started about 10 years back, when I came on board to standardize architecture, and Isaw there was a proliferation of various middleware technologies. As we started going along, wethought about how to standardize that architecture.As we faced more and more applications coming into the Java middleware world, we found thatthere’s a lot of footprint waste and there’s a lot of delivery cycles that are also slipped andwasted. So, we saw a need to control it.After we started the architectural world, we also started the production support world and afacility for testing these environments. We started realizing, again, there were things thatimpacted business service level agreements (SLAs), economy of scale, even branding. So, weasked, how do we put it together.One of the key things is, as we started the organizational performance, we were part of QA, butthen we realized that we had to change our business strategy, and we thought about how to dothat? One key thing is we changed our mindset from a performance testing practice to aperformance engineering practice, and weve evolved now to performance architecture.The engineering practice was focused on testing and analyzing, providing some kind of metrics.But, the performance architectural world now has inﬂuence into strategies, design practices, andresolution issues. Were currently a one-man or one-army team, kind of a paratrooper level. Weremulti-skilled, from architecture, to performance, to support, and we drive resolution in theorganization.Gardner: What is your role in that team?Naguib: I manage the organization in terms of deliveries. We hold internal best-practicediscussions. We catch trends and metrics in our knowledge base. We inﬂuence design. We eveninﬂuence vendors that come in. We partner with a lot of the products that come in.So, we meet with IBM, HP, and Oracle products, and as we inﬂuence and capture trends, wework back with the product development teams to ﬁgure out how to ﬁrst resolve internaldevelopment, as well as the product that we build on.
Gardner: And as you were making the transition to this performance architecture, what weresome of the important considerations you had in terms of making that more holistic, moremanaged, and more comprehensive?Naguib: One of the biggest things was the time to market. We also saw that resolution had tohappen quickly and effectively. Carnegie Mellon did a study about ﬁve years ago and it said thatpost-live application resolution of performance issues was seven times the cost of pre-live.In other words, we realized that the faster we resolved issues, the faster to market, the faster wecan address things, the less disruption to the delivery practices.Too many people involvedIn normal ﬁreﬁghting mode, architecture is involved, development is involved, andinfrastructure is involved. What ends up happening is there are too many people involved. Wereall scrambling, pointing ﬁngers, looking at logs. So, we ﬁgured that the faster we get toresolution, the better for everyone to continue the train on the track.We built a practice with architectural engineers and DBAs to get to issues and resolve themfaster.Gardner: So, when youve got multiple teams and then fairly large numbers of people involvedwith these teams, theyre probably distributed as well. What’s the overall umbrella concept?What did you need to pull that all together and to give you that view into these activities to makethat performance, integrity, and speed come together?Naguib: The key thing is tnat we started working with the CIOs at that level, and ﬁguring out astrategy to develop a service level target, if you will. As we went along, we began working withthe development teams to build a relationship with the architectural teams and the infrastructureteams.We became more of a team model, building more of a piece maker model. We regrouped theorganization, so that rather than resolve and point ﬁngers at each other, we resolved issues a lotfaster.Now, were able to address the issue. We call it "isolate, identify, and resolve." At that point, ifit’s a database issue, we work directly with the DBA. If it’s an infrastructure or architectureissue, we work directly with that group. We basically cut the cycle down in the last two or threeyears by about 70 percent.Gardner: And, as youre increasing your goals of speed and integrity, are you also able to handlemore applications at once? Does this improve the volume of applications going through yourpipeline?
Naguib: Absolutely. Because there is a change in our philosophy, in our strategy to focus moreon business value, a lot more CIOs have started bringing in more applications. We see a trendgrowth internally of roughly about 20-30 percent every year.I have a staff of nine. So, it’s a very agile focused team, and theyre very delivery conscious.Theyre very business value conscious, and we translate our data, the metrics that we capture,into business KPIs and infrastructure KPIs.Because of that metric, the CIOs love what we do, because we make them look good with thebusiness, which helps foster the relationship with the business, which helps them justifytransformation in the future.Gardner: Can you share with us any of those KPIs, what’s the report card that you could bringback to your superiors in a business sense? What’s the business case and rationale you canprovide?Footprint is keyNaguib: If you look at ITSM model, Service Level Delivery, one of the key things is thefootprint of applications. One thing that organizations are starting to realize now is that softwaredrives the hardware. For example, the cost of WebSphere on hardware is much more expensivethan actually buying a server.In traditional ﬁreﬁghting mode, people tend to hire consultants, bring in hardware, and end upincreasing their cost. What we found is that, if you address the software angle of it, then you canimprove your TCO and ROI.By taking a looking at correlating business transactions to a footprint on a server, and improvingthose transactions and their consumption rate, youre actually effectively improving theconsumption of that application particularly. And as you improve that, there is more room forcapacity. When theres more room for capacity, your economy of scale goes up. So, if TCOimproves, ROI improves, and your technical debt actually gets resolved a lot faster.Gardner: It sounds as if managing the development, tes,t and deployment cycle effectivelyreally is almost like the head of a pyramid and affects the entire IT economic equation.Naguib: Absolutely. There is a new paradigm now, they call it the "Escalator Message." In 60seconds or less, we can talk to a CIO, CTO, COO, or CFO about our strategy and how we canhelp them shift from the ﬁreﬁghting mode to more of an architecture mode.If that’s the case, the more they can salvage their delivery, the more they can salvage theireffective costs, and the more they can now shift to more of an IT-sensitive solutions shop. Thathelps build a business relationship and helps improve their economy of scale.
Gardner: Were hearing a lot here at Software Universe about ALM 11, a new launch by HP.Youve been a beta user of at least some of the components of that. Tell us how that started andwhat you experienced?Naguib: Sure. My background is that I dealt with the Mercury products back in the late 1990s. Ihave experience with Quality Center and the improvements that have gone on over the years.Because of our focus, we built our paradigm out of QA and into the performance world, and westarted focusing on improving that process.The latest TruClient product, which is a LoadRunner product, has been a massivegroundbreaking point solution. In the last two years, frankly, with HP and Mercury gettingadjusted, there’s been kind of a lag, but I have to give kudos to the team.One of the key things is that they have opened up their doors in terms of the delivery, in terms oftheir roadmap. Ive worked extensively for the last roughly year with their product developmentteam, and they have done quite a bit of improvement in their solution.Good partnership roleThey have also improved their service support model; Help Desk actually resolves questions alot faster. And we also have a good partnership role, and we actually work with things that wesee, and to the inﬂuence of their roadmap as well.This TruClient product has been phenomenal. One of the key things were seeing now is BPMsolutions are more Ajax-based, and there are so many varieties of Ajax frameworks out therethan we know how to deal with. One of the key things with the partnership is that were able totarget what we need, they are able to deliver, and we are able to execute.Gardner: So, trying to ﬁt that into our larger equation, the test and development deploymentscenario is very important to the overall IT equation economically. How does this product,TruClient, ﬁt into that in terms of aiding and abetting your goals?Naguib: One of the key things is how to build partnerships across the organization, internallyand externally. LoadRunner and TruClient allow us to get in front of the console, work with thebusiness team, capture their typical use cases in a day-in-the-life scenario, and automate that.That gets buy-in and partnership with the business.Were also able to execute a test case now and bring that in front of the IT side and show themthe actual footprint from a business perspective and the impact and the beneﬁts. What ends uphappening is that now were bringing the two teams together. So, were bridging the gap basicallyfrom execution.Gardner: And as an early adopter and user, is there any 20-20 hindsight advice that you mightoffer to others who would be going down this trail as well?
Naguib: I would deﬁnitely send the message out to think in business value. Frankly, nobodyreally cares as much about the footprint cost, until they start realizing the dollars that are spent.Also, now, business wants to see us more involved from the IT side, in terms of solutions, topline improvements, and bottom line improvements. As the performance teams expand and matureand we have the right toolsets, innovative toolsets like TruClient, were able to now shift the costof waste into a cost of improvements, and that’s been a huge factor in the last couple of years.Last, I would say that in 8,000+ engagements -- were actually closing in on now 10,000 eventsthis year -- weve seen roughly $127 million in infrastructure savings that we have recouped.Again, that helps to beneﬁt the ﬁrm. Instead of waste, now were able to leverage that into moreimprovement side.Gardner: So, the unfortunate reality for IT is they often have to do more with less. Youve founda way to actually make that happen and perhaps continue it on an ongoing basis.Naguib: Absolutely. I am excited about what I do. We have a great team and a great strategy. Thesupport from my CEOs is fantastic. And again, we are seeing that just the whole partnershipmodel across both the vendor side and internally has been a super beneﬁt to the organization aswell as the industry.Gardner: Well, great. Weve been discussing IT consolidation, applications lifecycle bestpractices with Abe Naguib. He is Director of Global Performance Architecture and InfrastructureEngineering at AIG Chartis Insurance. Thanks so much, Abe.Naguib: Thank you. I appreciate it.Gardner: Were here in Barcelona at HPs Software Universe 2010 Conference. Look for thispodcast and others on the HP.com website, as well as via the BrieﬁngsDirect network.Im Dana Gardner, Principal Analyst at Interarbor Solutions, your host for this series of SoftwareUniverse Live discussions. Thanks for listening and come back next time.Listen to the podcast. Find it on iTunes/iPod and Podcast.com. Download the transcript. Sponsor:HPTranscript of a sponsored BrieﬁngsDirect podcast, part of a series on application lifecyclemanagement and HP ALM 11 from the HP Software Universe 2010 conference in Barcelona,Spain. Copyright Interarbor Solutions, LLC, 2005-2010. All rights reserved.You may also be interested in: • HP rolls out ALM 11 in Barcelona to expand managed automation for modern applications
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