Burning Down The House

Its a classic exercise for the kids: The house is on fire. You can only save ten of your beloved possessions. What do you grab? Okay, now the rules have changed: You can only save nine items. Any six. Any four. As your options get narrower and narrower, what do you save?
The economy may be a few steps away from its darkest lows, but were still in a recession, and information officers are finding themselves in a cruel real-life version of that once-silly kids game. Were cutting your budget by 10 percent. Who do you want to save? Were cutting by 20 percent. Were cutting by 25 percent. Who makes the cut, and why? And how do you fill the gaps created by those who are gone?
We asked these questions of CIOs and other high-level tech decision makers. Of course, asking who youd save in the event of cutbacks is awfully close to asking who you wouldnt save. Thats a topic that makes everybody nervous, so we promised not to use any real namescompany or personalin this article.

When it comes to naming the most crucial position in an insurance IT department, many CIOs, particularly from small and mid-sized carriers, came down foursquare behind their database administrators. One, head of a fairly large P&C operation in Pennsylvania, put it bluntly: Regardless of what language youre programming in or what packaged application youre using to run your company, at the end of the day its all about the data. If you dont have anybody to help you manage the databases, you wont be able to make the correct decisions to run your company.
Finding someone outside the company wasnt an option, even if it cost less. Nobody felt you could simply replace a good DBA with a random consultant from the outside and expect that consultant to do just as good a job. Reports are a never-ending need, said the CIO of one small specialty lines carrier in New York City. The network issues could be outsourced, but the database administrator is woven into what we do every day.
Also high on the list of critical employees are software developers, even with the market still somewhat saturated with dot-com refugees. Coders with that same hip-deep level of integration usually find themselves protected as wellits hard to outsource support for a program you created in-house; you might end up having to bring back the people you let go, this time as high-paid consultants.
You gotta have someone who understands whats going on [with the companys software], said the CIO of a mid-sized Dallas-based P&C company. I can outsource other technical activities, he explained, but proprietary software dictates a dedicated staff.
A CIO of a small company agrees: We have a lot of proprietary applications, and they need to be supported. Thats not a job you can run a classified to fill.
Programmers security may also be dependent on the companys focus. Someone proficient with imaging applications is relatively safe if the company is beginning a document management program. And someone with a broad knowledge of mainframes and integration will do well in a merger-happy environment, as the vice-president of technology at a small (for now, apparently) Phoenix-based life insurance company pointed out. Acquisitions are our number one area of growth, he said. Programmers are absolutely vital to the merging of the various computer systems.
If push came to shove, many CIOs would look to outsource such matters as networking and infrastructure, but others saw that as far too basic a need to farm out. You need to continue to run your business, said a CIO of an all-lines P&C carrier; he would keep the network team protected.
Another CIOthis one from a mid-size life insurerlists the network team just after his senior software developer, saying, Without them, theres no way to deploy all that new programming the software guy is doing.

Chiefs or Indians?
An interesting thought division came up when asked about keeping IT managers, or those they manage. Some felt that good leaders are harder to find than good grunts, while others expected to reduce the number of managers while broadening the responsibilities of those who stayed.
Were a hands-on organization, said one CIO who put his management team at the top of his list. Were all working people, including myself. Others echoed the point, opting to hang on to the vice-president of software development, or the chief architect. But others took the precise opposite view.
Wed combine units and eliminate some management so we can hang on to the people who do the work, said the CIO of one large national health insurer.
There is one employee above all others who is safest when the axe starts to fall. This persons title might not reflect her (or his) indispensability, but it might. If she does have an appropriate title, its usually something like relationship manager. You probably know who we mean: The person who combines deep-rooted technical savvy with insurance-industry know-how. There are tech people who happen to work for insurance companies, and insurance people who know some technology, but this person has both sides down pat.
As one CIO of a mid-sized all-lines company put it, We need someone who is technical enough to say to the businesspeople, I know you want this project done and it sounds very simple, but heres why your idea wont work. But he also has the business knowledge to say to the others [in the tech group] who want to advance their own projects, This wont work for the business, and here are five reasons why not.
That kind of person is even more crucial because he not only knows technology and insurance, but your technology and your business. Thats also not something you can advertise for; it takes years to build the knowledge base. One CIO puts it even more plainly: I cant outsource to people who understand my business.
And even if you could find someonean outsourcer or consultantwho knows your business and your software, that doesnt mean all is peaches and cream. As a CIO from a mid-size P&C carrier said, outside vendors and third-party business partners, can be, quite frankly, difficult. And that emphasizes the need for that relationship manager. Only someone with a full balance of business and tech talents can adequately communicate with these outside companies.
Its more important for the business problems to get solved than for the tech problems to get solved, chimes in an executive vice-president of a large mortgage and insurance company. And another, a vice-president of human resources at one of the largest insurance companies in the nation, said, We are not a technology company. We are an employee benefits company, and we must be focused on providing service to our clients.

What We Need Here Is an Ability to Communicate
Surprisingly, technical savvy didnt always top the list of skills that would allow people to keep their jobs, even when weve been talking strictly about the IT department. Business abilitiesbusiness savvyis always high on the list. A grasp of P&L, a knack for business, and even good people skills are important. Very important.
When asked, it was a combination of technical and business ability that led the list of skills CIOs were looking for. After rattling off a list of what he would look for, one CIO remarked, I havent given one technical skill yet, have I? When asked about desirable tech skills, he had expounded instead on the value of good communication. Indeed, the more general aptitudes of teamwork and responsibility were deemed far more important than any particular technical ability.
And yet, every CIO was eventually lured back to the technical abilities that are most in demand. Its pretty tough to say COBOL is important in this day and age, said a CIO from a large life insurerwho then said exactly that: Hey, everybodys administration systems are COBOL generated. It may not be sexy, but COBOL programming still ranks high as a desirable skill, followed closely by C++ and Java proficiency.
Also key in terms of the technical skills theyd look to keep is a knowledge of mainframe architecture, with AS/400 and MVS mentioned repeatedly as examples. For networks, Novell and Windows NT get the must-have nod. For Web development, the mainstays of Java and JavaScript remain key, although companies are increasingly relying on broader middleware products such as WebSphere and Visual InterDev for IBM and Microsoft shops, respectively.
Someone who can find patterns of information that would allow us to better serve our clients is always in demand, said the human resources rep at the aforementioned life insurer, which uses IBMs Universal Database. Others point to a combination of Microsoft SQL Server and Crystal Reports as the must-have data processing skills. We use Crystal Reports to figure out everything about our business, said one CIO at a specialty lines carrier. It has become central to what we do.

If the average CIO could design his dream tech staffer, the blueprint would include not just the skills needed for today, but the vision to see what will be important down the line. I dont want anybody too comfortable with what they already know, said the head of IT at a small P&C company. It is our goal to make our staff as multiskilled as possible. Two years ago, we might have had someone who was only a DB2 DBA, and we would say, well, youre going to learn SQL Server and Oracle, and we want you to know something about Windows NT or Windows 2000. To the extent that we can possibly do it, were trying to broaden the skill sets of the staff so they arent pigeonholed. But we need people who are self-motivated.
Technology is changing so fast, said that tech-oriented HR guru. Someone has to be on board to sort out the right technology solutions, and those decisions have to be smart. Not just for today, but for the future.

Eric Berlin is a free-lance technology writer in Maplewood, N.J.

Fixing the Holes

Our first question to the CIOs, essentially, was Who would you want to keep on staff when the ax comes down? Our second question was the next logical step: After the ax comes down, how do you do the same amount of work with fewer people? The first question was met with passionate monologues on the ideal qualities of a tech staffer. The second question was met with laughter.
How do I take ten pounds and put it into a five-pound bucket, is that what youre asking? said one life-company CIO. Well, you can incent people with overtime pay, and there are other creative ways to get people to do the job. A lot of your problem can be solved, he said, if youve been treating your people well over the years. It makes it easier to motivate people to take that hill if they believe that the company is their company. But, he concluded, You need to lower the bar on what is to be produced, and when.
Several CIOs advocated sacrificing the past for the good of the future. If a legacy system component is something we felt could be let go, then the staff in that area could be moved to something else, said one.
Another CIO, in agreement: We would have to look at our legacy applications and freeze themsimply not support or change them any longer. We are in the midst of replacing the back end of our insurance administrative systemsour underwriting component, our claims component, our billing and commission systems. From where I sit, it becomes difficult to spend money and resources on supporting legacy systems that will go away within 18 months.
Many CIOs advocate a shifting to outside consultants. Everything is done in-house right now, said one CIO at a large life insurer. Nearly every position short of those that required in-depth business knowledge could find itself in the hands of a consultantnetworking, infrastructure, even software support if the software is not proprietary.
Theres also the concept of cross-training those left behind. We do that now, in fact, said one CIO. Cross-training is critical as we build our applications, which are all multi-platform. Our top people are comfortable in the mainframe environment as well as the server environment. Theyre also some of our strongest COBOL people.
If all else failedif outside consultancies are nixed, and cross-training impossiblethen a massive reprioritization would need to take place. But most CIOs agreed that these decisions could not take place solely on the tech side of the business. Wed have to sit with the business folks and talk about if we cut here, these are the consequences, said one CIO at a mid-sized P&C carrier. We cannot forget that every action has consequences.
The business side would have to reprioritize their efforts before we could reprioritize ours, said another.
Yet a third was more blunt: I have to have the resources to do the work. Either the work does not get done or the work gets delayed. He concluded: If I lose a resource, then we have to eliminate whatever that resource did. EB

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