CIO interview: Angela Morrison, chief information officer, Direct Line

Migrating IT away from former parent company Royal Bank of Scotland is the main priority for Angela Morrison, CIO at Direct Line Insurance

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Migrating IT away from former parent company Royal Bank of Scotland (RBS) is the main priority for Angela Morrison, CIO at insurance provider Direct Line.

When Morrison joined the company in 2010, she was tasked with building technology from scratch following the Direct Line spin-off from RBS. Three years later, the Direct Line IT department has come a long way, with the first milestone of designing and building the new infrastructure completed in October 2013.  

“We have built a totally functional IT department, with all elements fully resolved. We quickly got sign-off for the migration of all our systems out of the bank and we’ve done the flotation of the business during that time, so that we could run the business on our own,” Morrison told Computer Weekly.

“Then we signed a deal with Capgemini to migrate the infrastructure and we now have two datacentres up and running in Swindon and Bristol with them – so that’s all working and we’re about to start migrating our systems over into their environment in the next month or so.”

Morrison is keen to point out that, over the last three years, her team carried on working on the "business-as-usual portfolios”, with key systems being delivered to business lines and change introduced with the planning and execution of the migration and the flotation playing out in the background.

Modernising the infrastructure

Moving all the Direct Line IT set-up from its former parent is a big task and making sure the new technology base meets the current and future needs of the business is critical.

“We needed to tune with the new world because clearly what we have in the bank's infrastructure isn’t available today in the modern world, so we introduced some new infrastructure into the Capgemini set-up with minimal disruption to our business,” Morrison says.

“But we also need to carry on working. It’s a big piece of engineering - moving from a shared infrastructure set-up to building something completely separate.”

The new infrastructure is based on a combination of IBM mainframe, Windows/Intel servers and Unix systems.

When the outsourcing deal with Capgemini was announced, the cost of the migration away from RBS's IT infrastructure was predicted at about £100m, suggesting a total worth of the Capgemini contract of several hundred million.

While Capgemini will run the company’s datacentre and provide cloud capability for software development and testing, Morrison says application development will stay inside the organisation.

Direct Line uses a number of other companies for tasks such as application maintenance, but no major contracts are planned in that area. Morrison says anything related to future outsourcing is “absolutely out of public terms”.

Dealing with suppliers

Despite much work has gone into creating Direct Line’s IT from scratch, Morrison points out that, while the IT department is new, the same cannot be said about the company and the way it deals with its suppliers.

“We have a very large procurement team that has dealt with big supplier deals, so procurement is not new to us. The people I have in IT recruitment are not new either, so we have a very mature model of how and who we procure with, and what our procurement policies are,” she says.

Morrison has extensive experience in handling complex supplier relationships. During her time as a member of Sainsbury's operating board, she undertook a review of the supermarket's IT provision; recommended the termination of an outsourcing deal with Accenture in 2005; and helped rebuild a new in-house IT function. So what are the lessons learned from that experience that she has applied at Direct Line?

“All through my life I’ve worked with both sides – as the supplier selling into the IT department and as the IT person going out to third parties. In my experience, there’s only one thing that works and that’s a win/win relationship,” she says.

You have to work on how you get all your third parties to sit down with your internal team, understand both sides of the deal and ensure you have a good deal for both parties. That’s all I have done all my life.”

Driving innovation

Examples of innovation at Direct Line after leaving RBS include the deployment of a software-as-a-service tool from Ceridian for human resources, and an ongoing telematics insurance trial with Tracker, where information such as customer journeys are analysed to determine claim propensity.

Our approach to building IT skills is based on three pillars: people that have experience but maybe not skills in IT; those who have the skills in the area; and those who are young and eager to learn. That’s very much our philosophy of building new teams

Angela Morrison, Direct Line

“The telematics trial is great, as we have a third party to work with and to help us build real understanding from what is a vast amount of data - much more than we ever had before,” says Morrison, adding that her team will be working on advanced analytics in the months to come, with third-party help.

“We’re looking to external organisations to help us do things with analytics in a much better way. They can come to us and say: ‘You’ve got this data and you may not have thought about this, but it can be used in some form that you haven’t thought about previously’.”

Morrison says the Direct Line IT team will continue to work on telematics over the coming months and develop the company’s website to improve customer experience online.

“We recognise that we have to be a digitally enabled business and we need to really understand what that looks like and how it affects us - making sure that our customer has a fully digitally enabled experience while enabling our colleagues internally,” she says.

Internal initiatives include allowing staff to bring their own devices into work and a trial of social media application Yammer, which allows employees to collaborate, stay connected and improve company-wide communication.

Focus on skills 

Building skills for the future is something Morrison cares about – she is part of the CIO board at IT sector skills body e-Skills UK – and she has introduced initiatives to develop skills in the next generation of IT workers at Direct Line. The company has had two small IT graduate intakes in the last couple of years and is looking at boosting that programme, while retraining staff from other business areas in IT as well as hiring experts.

“Our approach to building IT skills is based on three pillars: people that have experience but maybe not skills in IT; those who have the skills in the area; and those who are young and eager to learn. That’s very much our policy of building new teams, as we move into new technology areas,” she says.

According to Morrison, the most challenging area in which to recruit is project management: “That’s an industry issue - we have very good contract project managers, but it’s very hard to find good permanent project managers that want to join your organisation.”

Why should an IT professional with good project management skills be interested in working for Direct Line? Morrison is quick to answer: “We are in an industry that is leading across the world in terms of how it uses technology and here at Direct Line we always do really good stuff and have lots of opportunities to move into digital. 

"The migration is a big project management challenge and we have a great team working on it and this will be followed by many other high-end things.”

As for the agenda in 2014, her objectives are clear: “In a year’s time, we expect to have finished the bank migration and to have absolutely understood what our digital journey is going to be. And I think that’s a very challenging position for anybody to be part of.”

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