PMA Re Migrates Legacy to the Web

MERANT Micro Focus and DataDirect help reinsurer capture Cobol coding for use on the Internet.

Philadelphia-based PMA Reinsurance Management Co., a domestic property and casualty reinsurance subsidiary of PMA Capital ($3.5 billion in assets), wanted to migrate many of its existing applications to the Internet. However, one large obstacle stood in its way: a Wang Cobol legacy system.

"We really wanted to leverage the existing Cobol applications," says Paul Ayoub, chief information officer, PMA Reinsurance Management. "The Cobol applications covered all of our users," including underwriting, actuarial, accounting, operations, claims and IT—making a complete re-hosting of an entire mainframe even more difficult, explains Ayoub.

Obsolete Legacy

PMA Re's core back-office system was an early 1980s program named SOLAR (System for Online Treaty Administration in Reinsurance) that handled all contract processing, as well as many financial and claims processes. Although SOLAR had been modified extensively, ported to run on HP/UX and made Y2K-compliant, it was difficult to find staff to maintain the source code, and new modifications were impossible to make, says Joe Meyer, PMA Re's director of systems development. "We were looking at end-of-life issues on the development side," Meyer says. "We were building new systems around SOLAR and performing redundant processing to make up for its shortcomings."

Adds Ayoub, "The business was evolving and changing. We need to do things differently with our systems to run the business more productively," changes such as giving underwriters, claims processors and managers access to data in the legacy systems for reporting and validation of data.

Faced with an obsolete system and changing user needs, PMA Re began a search for an alternate solution and in December 1998 contracted for consulting services from Rockville, MD-based MERANT, a provider of change management software. According to Ayoub, the decision to hire MERANT was based on MERANT's expertise in Wang Cobol l, along with the vendor's experience in extending traditional Cobol applications to the Web.

PMA Re's initial objective was to preserve the existing Cobol business logic while migrating it to run on a 32-bit Microsoft (Redmond, WA) Windows NT platform with a graphical user interface for easier user access, and to implement an Oracle (Redwood Shores, CA) database for data management. PMA Re later expanded the objectives to include more data capture capabilities to turn the new system into a "true business intelligence system," according to Ayoub.

With the objectives set, PMA Re and MERANT began to migrate the applications to the new system, called PReS. PMA Re used MERANT's Micro Focus Net Express to extend its Cobol applications to the new architecture by constructing components from the existing Cobol applications and wrapping them as Enterprise JavaBeans or ActiveX components. PMA Re also made use of MERANT's DataDirect Connect ODBC drivers to connect front-end systems to the Oracle databases.

Once the new system was complete, PMA Re began training users on PReS. "Half of the users in the company were, in some way, involved in the development of the new system," Meyers says. "So, from a user perspective, training was not as painful a process as we had expected." Training sessions consisted of one- to two-hour sessions. "We did things consistently in the application...so showing the staff the application only once resulted in their ability to be very productive," Meyer says.

Immediate Payback

The results of the migration were immediate, although PMA can't pin down an exact ROI, says Ayoub. "Now we can integrate a lot of the different business processes and expand on new functionality that we could not do with SOLAR," he says.

"We process information much faster and we have created dramatic efficiency," Meyer says. "Six months from now, this company will not operate like it did in the past. The industry is beginning to share information electronically. If we didn't upgrade, we wouldn't be able to participate."

In addition to the increased efficiency, by using the DataDirect ODBC drivers to capture additional data within PReS, PMA Re has gained access to previously unavailable business intelligence, Ayoub adds. The reinsurer is in the process of creating an executive information system (EIS) to give senior managers access to information and reports.

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CASE STUDY CLOSE UP

COMPANY:
PMA Reinsurance Management Co., Philadelphia, subsidiary of PMA Capital ($3.5billion in assets).

LINES OF BUSINESS:
Reinsurance.

VENDOR/TECHNOLOGY:
MERANT's Micro Focus Net Express and DataDirect; Oracle database systems.

THE CHALLENGE:
Migrate Cobol apps to Net.

Greg MacSweeney is editorial director of InformationWeek Financial Services, whose brands include Wall Street & Technology, Bank Systems & Technology, Advanced Trading, and Insurance & Technology. View Full Bio