MøllerGruppen dramatically reduces costs and provides ... · MøllerGruppen is Norway’s largest car importer, with exclusive rights to the Volkswagen, Audi and Skoda brands. It

MøllerGruppen is Norway’s largest car importer, with exclusive rights to the Volkswagen, Audi and Skoda brands. It is also Scandinavia’s largest automotive dealer and since the acquisition of six dealerships in 2011, the largest in the Baltics. It imported 43,500 cars into Norway in 2011.

The Group has developed its own IT systems and applications over the past 30 years, creating core processes across the import and dealership businesses. It is also an IT reseller in its own right, selling on equipment to its automotive dealers.

Aware it needed to create data headroom for the business to grow, and with an outsourced mainframe contract with IBM due to expire, MøllerGruppen began investigating its options. “Our philosophy is to do small things all the time, rather than big things in between,” says Pål Knutsen, the Group’s IT director. “We wanted an evolutionary concept rather than revolutionary.”

Objective Lower IT operation costs, while minimising disruption to the business

ApproachDiscussed IBM mainframe migration options with HP, the incumbent storage supplier; visited the HP Center of Excellence for Mainframe Migration, followed by three reference visits and detailed feasibility study

IT improvements• Improved stability compared to previous mainframe platform,meanslessdowntime,whichallowsITstaffto concentrate on value-added tasks

• Centralised platform supports future business growth, enabling business to add new applications as required

Business benefits • Generated a return on investment of less than

three years

• Minimised disruption during migration, with no user training required, allows business to continue as usual

HP customer case study HP mainframe migration project slashes IT operation costs at MøllerGruppen

Industry Automotive

MøllerGruppen dramatically reduces costs and provides platform for business growth with mainframe migration

“By April we had 99 per cent stability; by autumn we had our best reporting status ever: just one stop. We regard it as more stable than the mainframe environment, which we never thought would happen. The mainframe is thought of as the ultimate in stability. The HP solution has so far proven to be even better for us.”—Pål Knutsen, IT director, MøllerGruppen

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Making the change, reducing the risk

Knutsen says the business had assumed, with hardware tending to lower in price, there would be little need to change the existing set up. “But under the IBM mechanism we would now be paying for the MIPS we were using, not the hardware. With our MIPS increasing 15 per cent each year, we’d gain nothing on hardware reductions.”

This shock, he says, was the impetus to start a discussion with HP, already suppliers of server and software. It was at this stage Knutsen was introduced to a concept he was unfamiliar with: mainframe migration.

“I was invited along to an HP event, where I met some people from the HP Center of Excellence for Mainframe Migration. It certainly captured my attention; we then had a guy from the Center of Excellence come to visit us. We ended up doing a three-day workshop with a feasibility study and recommendations.”

Migrating from IBM z/OS platform to a new environment based on HP-UX 11i v3 and DB2 UDB running on HP Integrity rx8640 servers, the plan promisedasignificantreductioninoperationalcosts.It would also allow MøllerGruppen’s IT department to retain the main responsibility of operating the platform, albeit supported by HP on business critical systems. MøllerGruppen would have an optimised usage of tools and well-proven processes, based on ITIL to connect IT objectives to overall business goals.

The proposal consisted of HP Integrity rx8640 servers, HP XP24000 Disk Array storage, HP Business Technology Optimization software for monitoring, HP Mission Critical support, Oracle Tuxedo, DB2 UDB, Microfocus development tools, backup software and batch scheduler. HP Global Methods would help execute the project.

The new platform would simplify the modernisation of applications. MøllerGruppen would still administer parts of the solution in COBOL, as previously, but the platform would provide a greater range of hardware and software options, reducing costs in development and administration. It would run on an open platform with standard applications in, among others, database, transaction-managing and compiling.

HP’s business case looked compelling. “We were increasing our MIPS by 15 per cent each, so under the previous contract we’d have seen a tripling of the price by 2015,” says Knutsen. “With a migrated system we keep with 2007 price-level all the way through. It sounded a bit too good to be true. Normally that means it’s not true.”

Reference visits were made to a bank, a retailer and a Police Force, to see a mainframe migration in progress. “We were concerned that any modernisation would require us to run two separate systems side by side. This means less organisation risk and less disruption to the business,” he says. “They all told us it was possible.”

Maintaining the codeKnutsen’s next concern was to convince his 12 COBOL programmers they had a future: “We’d been producing code for 30 years with our guys deep into the mainframe world. Would we be able to use them and their business process knowledge in the future to maintain a Java code?”

Further interaction with the HP Center of Excellence, showing the before-and-after code, helped win over the programming team. Training on Java demonstrated thesimilaritiesratherthanthedifferences;thosethatwouldn’t retrain were close to retirement age, others would be needed for occasional COBOL maintenance. “We spent time persuading people, calming them down and taking away this fear of change,” he explains. “This was an important part of the process.”

Customer solution at a glance

Hardware

• HPIntegrity rx8640 servers

• HPXP24000storage

• SANBrocade switch 8/24

Software

• HP-UX11iv3

• HPBTOsoftware for monitoring

HP Services

• HPGlobalMethods

• HPMission Critical support

Greater stability than mainframeThe migration started on Monday, January 17, 2011. Knutsen says there were 1.5 days of slightly slower functionality “but nothing a user would notice and by theWednesdayeverythingwasfine.

“By April we had 99 per cent stability; over the summer we had one or two stops; by autumn, we had our best reporting status ever: just one stop. We regard it as more stable than the mainframe environment, which we never thought would happen. The mainframe is thought of as the ultimate in stability. This is better.”

He says he had expected his team to be required to iron out any problems in the system, but this hasn’t been necessary. “We used these resources to improve the system, to remove any native bugs. It’s allowed us to focus on the best of the business: selling and repairing cars, not worrying about IT resources.”

The cost savings mean MøllerGruppen will have recouped its investment within three years. In addition, the cost stability allows Knutsen to maintain his fees to dealers. “The IT department is, in principle, anon-profitoperation.Doingthismeanswehaven’tincreasedourinvoicestodealersforthelastfiveyears(which is a decrease in real terms: we’re giving away inflation).Anditlookslikewecankeepthemthesamefor the next two-three years. That’s the vision: better functionality without budget increase. If nothing else this solution demonstrates our credibility.”

He says the platform allows for the evolutionary growth favoured by the Group. “We’re taking it module by module, adding new functionality. We’re in the process of adding an application for used cars, and we’ll be renewing the warehouse management and spare parts purchasing systems.

“This platform is good for business. It’s centralised, it’s focused on business processes and it allows us to see what’s happening in all parts of the value chain.”

For more informationTo read more about HP Services, go to hp.com/go/services

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