In his first interview, Standard Life's new CTO talks about the achievements of his team and plans for the future as the insurer places more importance on technology than ever before.
Mark Dixon has had a few busy months since was poached from IBM to join Standard Life last summer, an appointment that reflects the importance of technology as a key pillar of the firm's business strategy.
As the insurer's first ever chief technology officer (CTO), Dixon has led and accelerated the ongoing changes around systems consolidation, agile systems delivery as well as cost reduction - Standard Life wants to deliver efficiency savings of £100m by 2012 and IT will play a big role in the process.
"[Dixon's appointment] reflects the increasing importance of technology in our business, the desire to take IT to a higher level and accelerate our thinking around that area, so there is a conscious up-scaling around technology leadership," IT and operations director Christian Torkington told Computer Weekly in an interview shortly after Dixon was hired.
Technology-related changes had already been taking place when the CTO came on board. Standard Life has a range of systems that supported products the company no longer sells and markets it has exited. So the idea is to eliminate legacy as much as possible and bring in efficiency and standardisation.
Revamping the direct consumer offering
Standard Life's business strategy includes increasing its presence in the corporate and direct consumer markets. The latter area will drive IT improvements on an ongoing basis.
Standard Life's technology stack is now based on a Java programming domain running on IBM's WebSphere application server. This sits on a Red Hat Linux environment on Intel servers.
The new set-up supports initiatives such as the shift of the company's business to consumer activity on Standardlife.co.uk, launched last November, from a base of information to a transactional channel, where consumers can buy products such as personal pensions.
According to Dixon, the strategic value of the web re-launch was huge, because it proved the underlying technology. Last month, the online platform was upgraded with stock and shares ISA products, the next iteration of consumer offering.
"Over time, we will overhaul all of our products and services using the technology stack and part of the plan is to share as much of what we have developed as we can with other channels," said the CTO.
"Truth be told, some of the products can be slightly different between consumer and corporate markets, but wherever possible the idea is to develop once and deploy many times - one kitchen, many dining rooms."
More products aimed at final consumers will be brought to market during 2011. In corporate services, Standard Life launched an adviser zone for the IFA market, which is also based on the new technology stack, with more products due to launch in the next few months.
From a hardware standpoint, about 70% of the company's desktops are virtualised using a combination of VMware and Citrix technology. Most of the insurer's clients are provided by PCs - which Dixon considers expensive - so the intention is to refurbish the company's estate progressively with solid-state, no hard disk, thin-client devices.
The importance of being standard
Dixon, formerly a consultant with IBM, has experience in dealing with disparate technology sets. He recalls one of the worst situations he had to deal with previously involved 53 development languages in use at one business.
"It was a case where subsequent IT directors had come along and every time they had a problem, they would buy some new technology, generating the overhead of creating a team to solve problems, increased spend and so on," said Dixon.
"Clearly we don't want to go there. No architecture is 100% perfect, you wouldn't expect us to only use that [one set of technologies], there will be some exceptions but standardisation has proved sensible," he said.
"We are trying to bring everything we do under one programming paradigm and there will be exceptions for good reason, rather than lack of imagination and just using anything that seems simple at the time. "
Mindful of such exceptions, Standard Life bought Focus Solutions - a supplier focused on software provision to the financial services industry, particularly using Microsoft's .Net - as a "standalone technology vertical," and in recognition that systems would not be always uniform.
According to Dixon, the approach gives Standard Life the ability to move workforce around and getting staff to work on various areas, but more importantly, the cost of ownership in the long-term is less.
"The cost of managing of disparate sets of technology, the management attention, planning because you are trying to marry different things can be quite high, so having just one set of technologies is much easier," he said.
Tapping into local expertise
The IT transformation at Standard Life was already happening when Dixon arrived, and he noted that - luckily - it was a technology set of which he approved.
However, the IT strategy has introduced changes in the skills of the workforce around the new technologies that are being used and agile methodologies that have been brought in as well, but is "not without its challenges."
"I worked in various flavours [of agile development methodologies] and to get that to work effectively in an organisation it requires a quite different mindset," said Dixon.
Standard Life has a development workforce of about 1,000 people, plus 350 staff working in IT operations. The contractor population is quite large and the firm also works with key sourcing partners such as IBM for managed testing services - the supplier has also brought in expertise needed for knowledge transfer, since its products are part of Standard Life's core IT set-up - and Accenture for application management skills.
As well as using global resources as a key aspect of its IT strategy, the insurer also wants to tap into the pool of local expertise and is creating a forum for local organisations and universities to pitch technology-related ideas. The idea is that some will be selected and used in a "Dragon's Den" type of environment.
"We are very keen to give small firms the opportunity to work with us on new ideas and introduce a process to capture some of those initiatives. We want to create a community where local capability can play with us," said Dixon.
Standard Life's senior executives have often mentioned technology as one of the key weapons to remain competitive and also to drive a customer-centric approach and respond to changing business needs - in short, the company "gets" IT, says Dixon.
"I am lucky in that respect, and also in the fact that the state of the architecture is in much better shape than what I have seen in other organisations, so I had a great start," he said.
"I think that any organisation that doesn't have technology high up on its agenda has a pretty miserable future ahead, given the way we do business is changing so much. You just can't ignore technology, certainly not in the business we are in."