Software, network and systems architecture are all about design. Processors, processes and new components should ideally fit together as a harmonious whole. For a nation, infrastructure includes factories, roads, schools, telecommunications, power and other services and systems that determine economic growth. In a business embracing manufacturing, back office and financial systems, the infrastructure is the network linking them all together and the operating systems allowing users and external partners to interact with the information.
The ideal architecture should embrace standards and best of breed technology in a flexible way, so the resulting infrastructure allows applications to start small and inexpensively and adapt quickly as new users or capabilities are added to the mix.
For this special report, MIS New Zealand interviewed the following senior executives:
Brent Powell, general manager information technology, Pacific Retail Group;
Ian Walker, IT manager, production director, New Zealand Magazines;
Jonathan Hooper, IT manager, Barfoot & Thompson;
David Bakker, IT strategy and architecture manager, IAG New Zealand;
Neel Pathak, flexible learning projects manager, Wellington Institute of Technology (Weltec).
1. Green screen to green fields
Don’t dictate, produce guidelines and recommend the best fit. Creating an architecture is similar to town planning, says IAG New Zealand IT strategy and architecture manager David Bakker. It’s about where things should be built to make best use of the services and providing the best fit with neighbours when placing industrial and residential sites, rather than dictating the exact style and shape of buildings.
“With an IT architecture, certain applications fit best in certain locations. For example, we do not dictate what an HR package has to be, only how it works best when it’s implemented.”
Rather than a rulebook, architecture is a guidebook to help users select what they want and ensure vendors know how a business works. “If you state to vendors and users how the environment works they can come up with the right answers earlier on and everyone knows where they stand.”
IAG New Zealand was in the process of replacing its core insurance systems, moving from green screens to a Windows environment when it went into acquisition mode, completing its purchase of NZI in January last year. Bakker, who’s been with the company since it was State Insurance, had to revisit the overall IT requirements, which now embrace more than 2000 staff; a nationwide network of 10 call centres; 42 sales centres and branches; and eight professional offices.
The merger of what was essentially State Insurance’s infrastructure with that of NZI was eased by the fact both were using Citrix thin client technology and ATM wide area networks. At least they could talk to each other. The major difference was legacy back-end insurance applications. “We’re going from old green screen technology to Windows-based technology and from a transaction-based system designed around sheets of paper to a workflow-based approach,” says Bakker.
Getting everyone to agree at a technical level can be hard. Then, there is the challenge of ensuring the changes don’t disrupt service. The objective to achieve one set of applications, a standard operating system, database, LAN and email platform was made clear through the creation of a ‘target architecture’, which sought to put a structure around the various streams, stating how things would look in a year’s time.
IAG plans to replace core systems with a Microsoft-based application running on SQL Server. This will ultimately roll out to NZI. “Their business focus is slightly different to ours – they’re brokers and we’re direct. We’re doing everything in increments. We’ll do our customer database and policies then go through a similar process with their customers,” says Bakker.
It was agreed to move NZI off Lotus Notes to Exchange and Outlook. A common address book is being established – once a common desktop and networking environment is in place it will be possible to rationalise email systems.
Ongoing flexibility is essential, that’s why the company has chosen to deploy a storage area network (SAN) and to stay with the Citrix thin client technology. “We have a reasonably scalable design, so we can put in extra capacity at the Citrix server, database or storage layers,” says Bakker.
The network architecture is also critical. At the moment, there is a standard outsourced ATM-based approach, but that’s currently up for tender – IP networking is a possibility. With the benefit of hindsight, Bakker says, integration with the web and the use of the XML protocol SOAP (simple object access protocol) might have been embraced earlier. “It was one step at a time, caught between immediate concerns and a long-term purist approach. Some of the answers weren’t so obvious two years ago.”
2. Keep an eye on the trends
Blind spots can be costly and limit business flexibility.
Brent Powell, IT general manager with Pacific Retail Group, believes it’s important to delegate at application and architecture level and be aware of technology trends, so technology choices don’t force the business in the wrong direction. “Wrong decisions now could have severe implications in 18 months time,” he says.
“Give someone the time and space to research where standards are heading, when Category 6 (American Standards Institute standard for cables) cabling might be appropriate, where IBM is taking the i-series, where HP is taking their latest range of processor.”
Powell is on the executive committee and can help lead the conversion. “It’s incumbent on a good head of IT to sit with the users and ensure their ideas are translated at board level. Keep away from bits and bytes at board level and stick to the commercial side – they’re not interested in being baffled with bullshit.”
Having a clearly defined relationship with vendors also helps with future planning. They tell you where they’re heading and you tell them what you expect.
He says Pacific Retail Group’s back office and main backbone infrastructure is now very stable and based on core products that have reduced the cost of ownership. The big challenge ahead is the application architecture.
For example, IBM’s latest version of Websphere for retail outlets has arrived at a time when PRG is questioning the longevity of its existing point of sale application. “Within a store environment, people want more and we have to look at turning it into a point of service where we deliver customer relationship management.”
The first step was to trial internet kiosks at Noel Leeming outlets. “This opens up the whole internet catalogue to even the smallest of stores.” It’s being done as a standalone activity but, depending on the new version of Websphere, could be integrated – in partnership with Xtra – as part of the total point of service environment.
Powell stresses the importance of having an independent review of projects. For example, when establishing the Noel Leeming website an independent consultant was called in to ensure its robustness. When it couldn’t be hacked, cracked, broken into or overloaded, PRG was confident it had made the right decisions.
There are incentives for the IT team to achieve performance objectives. “It’s part of the culture to develop an appreciation of strategy and constantly question business users about where they might take an application if it’s pushed to the nth degree. There are rewards for getting it right,” says Powell.
3. Do what you do do well
Outsourcing frees up resources to allow you to be business focused.
Ian Walker, production director with New Zealand Magazines (a Wilson & Horton company that publishes the New Zealand Women’s Weekly and The Listener) is always looking for best-fit technology to provide a logical pathway to the future.
“Communications is a dramatically changing industry. For me to speculate what might be happening five years down the track is pretty difficult – and not necessarily a wise thing, as you often have to be able to act a lot quicker than that.”
A series of decisions made over time has effectively seen Walker’s role change from IT management to production director, with a stronger focus on business issues. Through natural attrition, the company decided to outsource all its IT work.
The company went through a major upgrade of hardware, processing power and network capability about two years ago, including Nortel switching gear. “We needed to think ahead – we had been a stand-alone organisation but moved from Mount Eden to Grey Lynn as part of Wilson & Horton’s plans to integrate all its companies across the country.”
Walker says network infrastructure is the biggest factor in assuring confidence about future changes. New Zealand Magazines is connected to Wilson & Horton’s wide area network, leaving it responsible for its own local area network and building infrastructure. It runs Windows 2000 Server and Lotus Notes as preferred email software and Telecom’s frame relay for the wide area network.
“We’re pumping whole issues down that pipeline to our graphics company in Manukau City at about 16Mb per minute. The internal network is 10BaseT Ethernet over Category 5 cabling which may need speeding up in the future.” The business could easily move up to 100Mbit/sec if required.
Having standards in place and working with companies with an established track record is pivotal. New Zealand Magazines is essentially a Mac site for design, layout, editorial and production, including high-end scanning.
It sources much of its Macintosh hardware and publishing-related software from Imagetext, with an IT person coming in most days.
“We’re committed to Macintosh, and that’s not likely to change, because they have success in the graphics market and we know they’re committed.” He is concerned he is often forced to purchase specialist publishing software including functions his company will never use. “I’d love software manufacturers to thin-out product for the likes of ourselves.”
The cost of maintaining upgrades has also been an issue – that’s why the company moved away from QuarkXPress. “Every time we had to upgrade, it felt like we were buying new software but not getting anything ‘whiz bang’ that would change what we were doing with it. We moved to InDesign because it wasn’t so expensive, had good integration with Photoshop, Illustrator, PDF and the way the industry is moving toward computer to plate (CTP) processing.”
Organisations looking at their infrastructure architecture should seek advice. Along with keeping abreast of hardware and software developments and reading white papers and industry media, regular discussions with vendors and industry partners are important, he says.
4. Expand and contract
Being flexible for boom and bust cycles can prevent overcommitment.
Real estate is a cyclical business, so Barfoot & Thompson has structured to expand its business systems in boom times and contract under crash conditions.
“We have a lot of flexibility. We could make a paradigm shift fairly quickly without being too bogged down in existing technologies. There would be training involved, but we wouldn’t be writing off millions of dollars in existing systems,” says IT manager Jonathan Hooper.
He says the biggest risk is having IT drift away from a close integration with the business strategies and culture. When IT evolves independently it can lead to support, technology, cost and people problems.
“When I started with Barfoot & Thompson they didn’t really have any central IT co-ordination, but had a strong culture and set of strategies that were easy to identify. It wasn’t difficult to come up with an IT direction, it was just a matter of growing it.”
Having a sound architecture means he knows what is required to be considered successful. It’s essential to get a clear vision of intended business outcomes, measures to determine whether these have been achieved and to actively monitor how IT is changing to fit the business model.
“IT people tend to be project orientated and think that when they’ve finished one thing that the door’s closed but its often just the beginning of constant fine-tuning and realigning systems with the business.”
Barfoot & Thompson’s IT plan requires minimal overheads and leans toward outsourcing. The company owns rather than leases a lot of equipment, claiming this allows for cost absorption in tough times and has telecommunications and networking based on volume of use. Staff members are paid on a performance basis.
Currently, it’s boom time for real estate in Auckland. “We’re sending large amounts of information, including photos and listing information across the computer network. If the economy and the property market slow, then traffic decreases and the cost of the network changes accordingly.”
Each of Barfoot & Thompson’s 53 branches throughout Auckland and northward to Kerikeri has 256 to 512Kbit links using Telecom’s IP networking. “We can turn the tap on and off. Being IP-based, it gives us the ability to target particular protocols – for example, if we wanted to use thin clients we could target that traffic against the larger FTP of photographs.”
Barfoot & Thompson feels confident about moving forward into new areas. It is currently web-enabling many of its applications. “This is good for introducing new functionality and taking advantage of new opportunities as well as being a cost saver.”
Hooper says the web is an efficient way to deliver an application to 1100 staff in the office, at home or working on laptops in their cars. Part of the saving is in reduced training.
The company has digitised its entire image system from digital cameras in the field to the pre-press stage. Previously everything was done manually and the company ended up duplicating the functions of a print house.
Today the image database is outsourced to SmartPage which has about 10,000 photos on its database. These can be sized for Property Press or the web. “We know the end result, so everything goes through an automated process.”
Currently, Barfoot & Thompson is automating its rental management business, which has not been supported by technology previously. On a smaller scale, it is reworking its financial systems to more closely integrate with other applications. “There has to be a clear business case for integration – even building a file transfer process still needs a business case, although there’s still a good argument to have some things stand alone where there’s a discrete need and an identified outcome with no impact on the rest of the business.”
5. Understanding impact
Testing possible outcomes before committing to big projects reduces risk.
Neel Pathak has recently taken over the role of flexible learning projects manager at Wellington Institute of Technology (Weltec), now gearing up to meet exponential demand for its services as it adds online learning to the curriculum mix.
Weltec is focused on information technology, media arts and cyber-technology but, before committing to deployment of remote learning tools, it needs to understand the impact on its existing infrastructure.
Pathak not only has to consider the demand on server and bandwidth resources, but also training and change management issues and ensuring everything aligns with the overall business strategy.
“I think the technology infrastructure might be more manageable than the people side of things, because it involves a mindset shift from delivering a lecture using chalk and a blackboard and putting ideas in written format so they’re accessible repeatedly.”
When Weltec was created two years ago through the merger of Hutt Valley Polytechnic and the Central Institute of Technology, everything was relocated to Hutt Valley.
An upgrade to Novell’s Netware 6 and new licences were needed to cope with the 4500 workstations. The campus now has 9000 students and 450 staff.
It is installing Dell servers, Microsoft’s SQL and Information Server and a new learning management system. It may consolidate servers and move to IP storage to meet the growth in student numbers.
Pathak says key considerations are creating a firewall to provide secure access and identity management using Netware. “We’re looking at this in stages. The pilot program is to better understand what demand there might be for bandwidth and program-wise.” Bandwidth coming into the server – currently 100Mbit/sec – will also have to be beefed up.
As part of an overall consolidation of computing resources, Weltec is leveraging lessons from other learning environments and conducting its own research before going into a pilot stage for on-demand computing.
Constant change and bad planning leave many organisations wedged between the old and the new, unable to move ahead without costly re-engineering. While the initial cost of achieving interoperability may be relatively high, the long-term benefits are worth it. If you get it right, you not only reduce the cost of maintaining and managing your infrastructure and everything attached to it, you reduce the need for training and support resources and improve overall organisational efficiency.
Building a lasting infrastructure architecture
Greg Woolley is managing director of Certus Consulting (www.certus.co.nz). Its clients include AMP, BNZ, Sky City Entertainment, Tranz Rail, the State Services Commission and the Department of Internal Affairs. Here, he provides some tips on building a lasting infrastructure architecture:
1. Risk reduction and total cost of ownership (TCO): The key imperative for business applications is return on investment and delivering business value through applications, reducing risk and cost of ownership.
2. Open Standards: An open standards infrastructure ‘stack’ enables a ‘loose coupling’ between layers and reduces the risk of vendor lock-in and problems with scalability.
3. Consider business process management (BPM) as a key enabler: Integration of business processes and IT systems is the key to a scalable, flexible infrastructure. BPM can enable changes to be made to business processes without the need for customising underlying applications.
4. Enterprise architecture is a must: A well-defined and policed set of enterprise architecture standards reduces risk and TCO. Too many organisations have a ‘one of each’ IT infrastructure, which increases TCO and risk.
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