Keeping a cool head

CIO Sessions Sharam Hekmat is not one to rush into things without his eyes wide open.

The chief information officer of financial services group Aviva Australia likes to closely evaluate all the potential risks before he'll commit to a technology change project.

"It is a lot about planning," he agreed, ruminating with ZDNet Australia recently on his CIO role.

"Certainly these days we don't take any chance with the major developments. We go through a lot of proof of concepts; in the case of complex systems we went through a year of proof of concepts."

"So before we go forth and commit many millions of dollars to a development, we want to make sure that we've identified every risk and we've got a way of addressing it, and there is a really good chance that this will succeed, and within timeframe."

Hekmat's methodology served him well as Aviva recently substantially changed its ICT service supplier relationships, breaking up a large HP outsourcing contract into several chunks and bringing some services in-house.

"We did about six months of background work before we made the decision," Hekmat said about the move, noting Aviva concluded its needs would be better served by dealing with smaller service providers than HP.

"It was a very considered decision ... all the implications were considered, all the cost models drawn up and analysed and so on," he said.

Aviva ended up allocating its service desk and desktop PC services work to Getronics, with Data#3 picking up network services. Server management was brought in-house.

"I think there is a hell of a lot of competition," said Hekmat of the ICT services market. "There are new players entering all the time. But we were quite careful not to go with somebody who's just joined the market."

Avoiding vendor hype
Hekmat takes the same considered approach to currently hyped technologies such as Windows Vista, Microsoft Office 2007 and Internet Protocol-based (IP) telephony, arguing that they need to be looked at in terms of wider business drivers.

Aviva migrated to Windows XP and Office 2000 around a year ago. Hekmat said the software was currently serving Aviva's needs more than adequately.

"For us, a migration such as moving from XP to Vista, is not a cheap exercise, it's quite expensive," he said.

"And unless we do it very carefully, it can be quite disruptive as well. So there is the cost of implementation, and then there is the negative cost of impact to the business."

"We have to consider those, versus the true value they deliver. And of course, unfortunately with Microsoft, often the value is very marginal."

The CIO is more interested in IP telephony, arguing the technology had the potential to deliver cost savings to Aviva as well as higher levels of service. Aviva will evaluate the case for IP telephony on an annual basis from now on, but doesn't have any immediate implementation plans.

Another priority for Hekmat is the migration from legacy back office systems, which he believes needs to be looked at in a strategic way, as the old technology gradually becomes unsupportable.

He said organisations needed to put a lot of thinking into judging the right moment when it made business sense to migrate from an old technology -- balancing the risk of migration and the cost of redevelopment with the problem of the system eventually becoming an unsupportable liability.

"I think there comes an optimum time when it makes sense to migrate, and if you don't use that window of opportunity, then it's gone for ever, and you face an enormous risk," said Hekmat.

Good governance
Ultimately, whether any project will succeed or fail is likely to come back to the way it is managed and governed.

Hekmat has a few tips in this area to pass onto fellow CIOs, drawing on his experience in the past few years with projects such as re-engineering Aviva's externally facing IT systems and internal network, as well as a current overhaul of internal administration systems.

"I think different organisations are at different levels of maturity when it comes to running a project," he said, noting this applied to exercises as simple as replacing a network switch or as complex as a major software development project.

In Hekmat's view, some organisations take a very casual approach to establishing project offices, and project management in general -- essentially "just hiring a project manager and giving them a task" and running with it.

Others take a more methodical approach, establishing a project office with more formal and mandatory processes such as gates, businesses cases and reviews.

"We used to be in the former category, but as of probably four years ago, we're in the latter category, and I've seen the benefits that can deliver, and I personally would never go back to the former model," he said.

"Because that's where a lot of very serious risks creep in."

Hekmat's faith in the methodical approach has paid off. He said Aviva had knocked projects back on multiple occasions because risks were too high or benefits weren't justified.

"Just imagine if we'd gone ahead with these projects ... it would have been very damaging to the organisation," he said, noting if project governance hadn't been formalised the projects would have gone ahead.

"If CIOs don't have that maturity in place, they should think about putting that in place right now," he said.

Hekmat's determination to do things his way -- and not rush in blindly -- has also delivered an unexpected reward.

"Overall I'm feeling really positive about what I do at the moment," he said. "I've got no worries at night -- I sleep quite well."