Cobol mainframe is not legacy: Allianz

Five-year transformation to improve service and efficiency.

Allianz Australia has defended its decision to design a five-year "transformation journey" on top of a 30-year-old Cobol mainframe application, describing the choice as a low-cost, low-risk option.

Since 2009, Allianz has consolidated about 350 servers and two mainframes onto a single mainframe with a core policy administration system built on IBM's Cobol for z/OS.

Integration architect Mark Kyte told a Gartner conference in Sydney this week that the insurer had kept Cobol at the heart of its application development decisions, with the core system interfacing with call centre, online, staff, B2B portals and a new claims plaform.

"We decided to do that with the mainframe and with Cobol at the heart of those decisions," Kyte said. "The wheel is still there and it's working – we're just building a nice new sexy car that sits on top of it. And we know that wheel will turn when we need it to. "

Kyte said the cost-effectiveness, reduced risk and ability to utilise existing skills among staff all factored into the decision to adopt a legacy modernisation model.

"It's never easy to implement something brand new into your environment; there was significant risk associated with either purchasing a product or trying to build our own brand-new claims application to provide the core claims functionality," Kyte said.

"There's a whole bunch of brochures out there for different claims applications, but as we looked at them it became clear that they wouldn't be a fit for us... they don’t do it the way Allianz wants to do it."

In May, Allianz chief information officer Steve Coles told iTnews that the insurer had 40 Cobol developers in its 350-person IT team and did not expect to face skill shortages for the ageing programming language for at least five years.

Kyte said retaining Cobol had also allowed Alianz to exploit existing business rules buried in the code of its applications and has led to more predictable outcomes.

"The [business rules] are there, they're codified and [we] know they work. Why would we want to throw them out?" Kyte said.

"When we do projects now where we're required to expose functionality from our backend applications to the front end, we get consistent outcomes.

"Our Cobol developers know what works, know how to make it work and they can do that in defined timelines – if they set an estimate they hit that estimate."

Kyte said Allianz would migrate processes off the ageing technology when the cost-benefit analysis justified doing so, but such a move would not mean the replacement of all its Cobol technology.

"The Allianz mindset doesn't treat Cobol and the mainframe as 'legacy', because the interpretation [of legacy] is that you're going to throw it out," Kyte said at the event.

"That's not the path we've taken at Allianz. We see Cobol playing a major role for us for the foreseeable future."