Data migration and modernization myths debunked

By Mike Allee

Digital transformation is dependent on and driven by modernizing your data. This is critical if carriers are going to be able to take advantage of new tools such as advanced analytics, great customer experiences and artificial intelligence. All of this has led to an overwhelming number of “expert” opinions on modernization best practices.

However, not all the commentary is useful or accurate. And following misguided advice will cost companies significant time, effort and money — taking them even further away from their goal to realize the full potential of their digital transformation.

With that in mind, here are some of the most common myths about data modernization and migration.

Myth: I’ve modernized my data once I’ve extracted it from my legacy system(s) and put it in a data warehouse.

Have you ever started a DIY home improvement project and realized that you bit off more than you can chew? Data modernization can be the same way.

Carriers sometimes declare victory when they’ve exposed their data with the extensive experience of their internal IT staff. But the uses of this data may take a much different context than their current systems provide. True modernization may require unique technical skills, experience and expertise that doesn’t exist in their current organization.

Myth: Data migration can easily be done with my existing team.

Carriers don’t regularly migrate their data; that’s a project that comes around only once in a blue moon. Often these are “generational” projects that may happen once or twice in a career. As a result, few in-house IT professionals can truly claim to have real, comprehensive data migration project exposure.

Lack of experience can lead to issues like underestimating the size, difficulty and cost of a migration project, lack of adequate planning, lack of experience with new policy administration system data requirements, lack of experience with iterative modernization and migration methodologies and a belief that existing tools can do the job — even though they weren’t designed for that purpose.

To avoid these issues, carriers must look to external vendors for assistance. They must seek out vendors with years of experience working on data migration projects with many different carriers, platforms (mainframe, mid-range, server based), legacy systems and modern PAS replacements. There are few that truly know what to expect in each unique situation, have experienced staff to help plan the project, can provide contingencies to offset risks and have custom tools developed to increase migration speed and accuracy.

When it comes to data migration projects, similar to home improvement projects, sometimes you just need to call in the experts.

Myth: My company has the most difficult data to work with and the hardest problems.

It’s natural to frame the problems you’re experiencing as “the worst” and assume there’s no solution in sight. But many companies face the same challenges with their migration/modernization projects. This doesn’t mean that every carrier’s data is the same, but more so that other life insurance carriers are experiencing very similar roadblocks and have made similar decisions with workarounds or alternative processes that can affect the source(s) of data required.

If you partner with the right modernization provider, they can help keep the project grounded in progress by looking to their past experiences for insight on solving current project challenges. They’ll have been through so many similar scenarios that they can effectively address a carrier’s “hardest” and most unique challenges.

Myth: Data migration isn’t worth it because it’ll take too long and it’s too risky.

When this myth arises, we should ask ourselves, “What are the risks if I don't do this?”

Migration projects don’t pop up out of the blue; they’re often brought on by a pain point or a roadblock that a carrier finds within or because of their system and aging technology. For example, a new technology may emerge that they want to leverage or incorporate into their organization but are unable to because it doesn’t mesh well with the outdated data formats/architecture/storage protocols of their legacy systems. Or, they might be looking to overhaul their PAS and move their information into newer systems but can’t because of how their data is stored and written in their outdated systems.

With data migration, life insurance carriers must determine if the pros outweigh the perceived cons. The project might not be completed overnight, and it won’t be without its challenges, but that doesn’t mean it shouldn’t be done. It’s always riskier not to migrate data because carriers then run the risk of being unable to leverage new technologies and analytics in the market that could improve their product offerings and customer experience — and ultimately chance being left behind by their competitors.

Myth: Data migration projects can be completed with commercially available ETL tools.

Extract, transformation and load tools are intended to, as the name suggests, extract, transform and load raw data from multiple sources and store a vast amount of enterprise needs. Although this approach appears to cover much of the data migration work, it's not a complete migration process.

ETL tools, as they are typically implemented, aren’t the best fit for migration projects since they don’t perform many of the steps required to cleanse, reformat and test data being moved in the operational context of the policy administration system. ETL interfaces are often developed using failure-prone traditional methodologies, which can create significant issues when they're used in data migrations. Also, much of the quality assurance required to validate the operational data in these data stores does not get the organizational attention it deserves and, therefore, when it’s used as an authoritative source for data migration projects, issues emerge with the enterprise data and the associated ETL.

ETL solutions are particularly unsuitable for migrations because they can also require additional costly infrastructure to prepare the data for migration. This can result in a mixture of legacy and modern components with manual steps in between — requiring multiple skill sets, multiple development environments, larger teams and an increase in communication paths, implementation hours, cost and the probability of failure.

Using proven, leading-edge tools specifically tailored for data migration empowers business experts to take control of the process right from the beginning, rather than depending solely on IT initially and involving the business unit at a later stage.

Insurers should look for tools with a streamlined data conversion system that simplifies the development, quality assurance processes — including file management and data documentation associated with the migration, audit considerations and the necessary data transformations from source system(s) to target system(s). Ideally the tools should accommodate the consolidation of all business transformations within a single location within the tool.

Efficient data conversion tools should also facilitate early testing to uncover the unknowns earlier in the project, simplify error management, be able to intake new data requirements and flag potential problem areas. This will enable the seamless integration of these project requirements and streamline the overall process.

Data migration or modernization is worth it. Carriers must find the right expertise.

Carriers seeking to transform their legacy data into a strategic asset should be careful not to fall victim to the data migration and modernization myths discussed. Instead, they should partner with an experienced vendor, adequately plan and budget for the project and make strategic decisions about the data approach they’ll take, which should be based on their business needs and not on IT expediency or myths.

Data migration projects don’t have to create bigger headaches than those already created by their legacy data. Working with the right vendor, one who has years of migration experience, can mitigate modernization risk and reduce costs.

By being strategic about how they migrate, integrate and modernize their data, life insurance carriers can gain a competitive advantage in the market.

Mike Allee is president, Universal Conversion Technologies. Contact him at [email protected].