If it weren't for a bad case of writer's block, Michael Bernaski might be a famous novelist right now. Instead, he's the CIO and senior vice president of property-casualty e-business and technology at The Hartford Financial Services Inc.Last year, he accepted the senior technology position at the Hartford, Conn.-based financial services firm when he "hit the wall" trying to write a murder mystery during a year-long sabbatical from the consulting world. Bernaski had left Accenture, where he had worked for 15 years, to enjoy his newborn daughter and pen his way toward the best-seller's list.
"I got writer's block about five months into it," says Bernaski. "Then, I got a call to come work for John Chu (senior vice president, property-casualty e-business and technology) at The Hartford."
The offer appealed to him for two reasons, he says. One, The Hartford is a "premiere" company with a solid reputation in the industry. And two, Hartford, Conn. is Bernaski's hometown. "It was an opportunity to come home," he says.
Now back in his hometown-with the addition of a newborn son-Bernaski is applying his years of consulting expertise to transform IT services at The Hartford's P&C business.
Basically, like all good CIOs in 2005, he's applying discipline, governance and consistency to the IT organization. Specifically, he's responsible for six areas of IT management: business strategy and value alignment, service delivery and maintenance, architecture and infrastructure consumption, capability delivery, personnel and financial management, and transformation to a new IT delivery model.
In the area of business strategy and alignment, Bernaski is working with the business units-including business insurance, personal insurance, claims, and sales and service-to develop their business architectures. Those plans can then be translated into technology roadmaps.
"Currently, we're doing a lot of 'roadmapping,'" says the CIO. "As an organization, we're cultivating that competency-because we've been much more focused on operating plans than on three-year strategic plans."
Service delivery and maintenance is another area undergoing Bernaski's transformational touch. In addition to improving the group's incident, problem, release and change management processes, Bernaski is raising the visibility and importance of IT services and maintenance.
"Historically, service delivery and maintenance has been culturally undervalued," he says. "People working on projects and programs have been viewed in a much more positive light than the people who are keeping the machines running." To equalize that perception, Bernaski is elevating top performers in service delivery and management, while also raising the bar on core service delivery to the businesses.
"Right now, we don't apply service level agreements consistently-and in some cases, we don't even have service level agreements-or they're in-complete," he says. To remedy that condition, Bernaski's team is defining what it means by a service level agreement-and standardizing on those metrics, paying particular attention to the user's needs rather than just the IT perspective.
In the area of infrastructure consumption, Bernaski is encouraging a similarly disciplined approach to measuring costs. "A big part of what we're trying to do this year is to go back to the businesses and present them with options to measure costs and benefits so we can change our consumption patterns," he says.
Today, The Hartford, like many insurers, is paying the price for years of client/server experimentation, according to Bernaski. "It's difficult to proactively manage infrastructure consumption, in part, because we don't know which applications and which platforms are consuming which resources."
Twenty years ago, it was easier to measure because the mainframe was doing all the work, he notes. "The mainframe spit out data on how much processor, network and storage resources each application was using-essentially creating great visibility (into IT costs) for the businesses."
Drawing a clearer line
Essentially, under Bernaski's leadership, The Hartford is assessing how much money it is spending on technology in its P&C business with the explicit intention to allocate more budget dollars on future-focused activities.
"We're lowering the total cost of ownership of our existing environment by operating more smartly, and we're working with the businesses to lay out a strategic agenda that maps closely with how they want to position themselves in the marketplace," he says.
When delivering new capabilities, for example, The Hartford is trying to clearly distinguish the line between extension of old applications and building new ones.
"Right now, that line is very gray, says Bernaski. "If the maintenance team gets the work, it's an enhancement. If the development team gets the work, it's new development." But, in reality, at some point, enhancing a legacy application crosses the line and becomes building a new system.
"You have to have a solution orientation to know when you've crossed that line," he says.
The P&C's group is also adopting a "closer to the pin" mentality-as in closer to the bowling pin, he says. "The budget used to be something you didn't exceed. That was the goal."
As a result, when establishing their budgets, managers gave themselves some wiggle room. Now, however, The Hartford is managing the budget with the mentality that being under budget is just as bad as being over.
"We're trying to create a lot of visibility into cost drivers for the management team," Bernaski says. "By creating visibility, we can encourage the right behavior to make the most cost-effective, proactive financial decisions-rather than just trying to stay in limbo right under the bar."
Likewise, Bernaski is urging IT project managers to flag projects when they may be heading for trouble. "We have a reticence to call a project 'yellow,'" he says. Projects that are running smoothly are green. Those that are in trouble are red. Yellow, like a yellow light, is a cautionary status.
"People tend to view it as a bad mark on their personal report card when their project is yellow, when in reality it's worse for a project to go from green to red," he says. Yellow is a good management tool. It puts projects on the radar screen when they need attention.
And perhaps that attitude sums up Bernaski's overall management philosophy. He considers himself among the next-generation of tech-savvy business executives.
The next generation
The next generation business executive is not an autocrat. To the contrary, Bernaski-along with his boss John Chu-encourages discussion and openness-not deference to hierarchy.
"I never quite appreciated in my 15 years in consulting just how the corporate environment might defer too much to hierarchy," Bernaski says. "But John has encouraged a lot of visible and boisterous discussions. He encourages everyone to challenge the status quo and he never shuts the dialog down."
The Hartford execs also view technology as a part of their job. "In 1988, DB2 was king," says Bernaski. "Then we moved from data processing to IT."
Now, IT has turned into e-business. And, in that conversion, the typical next-generation business executive isn't someone who thinks about technology as another function or department. "They view it as another element in the value equation-along with products, services and brand," he says.
- Name: Michael Bernaski
- Title: Executive vice president and CIO
- Company: The Hartford's Property-Casualty E-Business and Technology
- Years: 1
- The Hartford Financial Services Group Inc.
- Headquarters: Hartford, Conn.
- P&C written premium: $10 billion (2004)
- Revenues (entire company): $22.7 billion (2004)
- Employees: 30,000
- Products: Automobile, homeowners, business insurance, life insurance, group and employee benefits, investment products
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