We bought a Maserati, we drove it like a Fiat and I needed to get it at least to an Alfa Romeo.
So says Gregory Ciaglo, Senior Director of Corporate Systems Delivery at health insurance provider Blue Cross Blue Shield of Massachusetts, when talking about the state of the organization’s IT platform as he found it a few years ago. Moving up a gear has been a priority since then:
I inherited the Salesforce platform a couple years ago. Part of my strategy has been to make it an enterprise platform, not just a sale system. So we have progressively gone from sales, put HR onto the platform, our provider group, our dental group for contracting. We've tried to look at the platform and say, 'It's not optimized'. That's issue number one.
A major challenge for Ciaglo was having to deal with the heavy levels of technical debt that were holding back his organization:
We just have a lot of tech debt. Our business partners, well intended, are resistant to change. I mean IT, I want to make them successful and I don't pretend to understand their business as well as they do, but they are terrified of change. Part of what we've done in some cases is we've pulled them along and said, 'If you're not going to move on to the system, I'm going to do a lift and shift. I'm going to give you exactly what you have, but on this new platform’.
He cites a case in point where BCBS Massachusetts has worked with Salesforce industry partner Vlocity:
We had a broker portal which was 10 years old - and that's pretty new at Blue Cross Massachusetts! It was falling apart. We also had a separate registration system that was also tech debt. So we looked at Vlocity as an opportunity to reduce our footprint, bring the two systems together and we pulled them over. They came kicking and screaming and then, within a few weeks, the businesses said, 'Wow this is pretty cool'. At the end of the day, being the IT geek. I'm focused on technical debt value, but I'm also looking at re-defining the application as an enterprise application, not a single business area and from there, get our money's worth of investment.
One major success in this transformation has been the setting up of a Center of Excellence (COE), which was a response to the need to establish an IT platform owner. Ciaglo explains:
We brought an individual in from Salesforce, recruited him, and he is working with our business partners to look across everything, establish best practice and really get us on a more disciplined approach on how to tackle things. And from there, the COE helps inform our senior executives. Our CEO might not be involved, but our Head of Sales, our CIO, they're definitely informed and they're looking to that organization to help break the ties at times. Yes, it's part of IT, but we have to focus on what's best practice. What we're trying to get towards is looking at what's best practice. Sometimes something feels good or somebody wants it, but we step back and we look at, you know, what should we be doing and using that COE as the agent of change.
As with any effective digital transformation program, there is, of course, a focus on Return on Investment (ROI). BCBS Massachusetts has a Portfolio Council that releases the funding for major projects, but Ciaglo points out that ROI isn’t necessarily always financial:
It can be a benefit to our member or to some other aspect of the company that needs to be addressed. But really [we are] making our business partners - and IT if they're submitting a project - define what the value is to the company. I think we got a little lazy several years ago and people were just buying and doing without thinking it through. We were falling into a pattern where three different business area might have three different solutions that do the same thing. So we're trying to focus on control of a portfolio process that looks across the enterprise.
There are a couple of additional funding pots to dip into, one of them being an allowance to ensure technical currency:
When our CIO Beth O'Rorke came in, she inherited a lot of technical debt. Four years ago when she came we were on IE 6. Nothing was ever upgraded. She's been passionate about that. Accordingly we have a tech currency budget as well. Sometimes it's in a Salesforce space, but, you know, depending on what it is, we may tap one of those two budgets. Obviously the tech debt is driven by IT. So it's typically a lift and shift model, where it's more value that comes over on the portfolio.
There’s also a maintenance and enhancement (M&E) budget, also known as “care and feeding’. Ciaglo explains:
These are captive budgets that are aligned to the business area. They are all within IT. We work with them for the smaller activities, supporting releases when we want to keep things current, but it's not to the level of a major tech project. With Salesforce, we want to make sure we're taking everything in. That's something we didn't do historically. We want to stay current with each of our releases, but we also recognize that the business needs to have some small wins. They can't go to a major project or business case on the small things. So our general rule is that anything under $100,000 falls into this care and feeding or M&E budget. Of course we have business areas that want 215 M&E projects for $100,000! They have a lump sum of money that working with IT they need to manage and trade offs.
Why things go wrong
The transformation process at BCBS Massachusetts has left Ciaglo convinced that there’s a simple reason why so many multi-year programs come unstuck - everyone wants everything. His advice is blunt:
Stop trying to boil the ocean. What we do is chunk up the work, regardless of the project methodology, chunk up the work. Find incremental wins, so that people feel like you're going down the road and you're getting there. Governance has been part of that. People hate that word, but in our organization they've started to see that because of that governance, they’re actually getting incremental wins. Whether I do waterfall or agile, when we chunk up the work, they get more return.
The projects that fail in our company often are the ones that get so big and bloated that the CFO sits down and sees a price tag of $200 million and says, 'It's over'. I'm working with those business partners and my IT folks too. I had the architects that want to build everything. They want to build the Mercedes Benz. They want you to go out and buy everything. 'Buy this, buy that, link with that’. I’ll say to them, 'So who's going to pay for that?’ and then they just stop. It doesn't even occur to them. So I'm trying to teach the architects and IT, because in many ways, even in IT, we're just as guilty of scope creep. It's a different type of scope creep, but we're absolutely just as guilty.
But one major achievement at this healthcare insurance has been a wholesale conversion from skepticism to evangelism when it comes to moving to the cloud. Ciaglo says:
We went to Office 365 as part of our strategy to get off of a very old version of Microsoft that was not supported. We were spending millions on extended support. Once we put our email system on the cloud, everyone kind of stepped back and said, 'Some of the largest companies in the world to do this. Blue Cross and Blue Shield can'. So now we've largely accepted that cloud is part of the modern reality, so much so that our attorneys and the legal systems are moving to the cloud. We don't see that there is anything that can't live there.