Magazine Article | August 1, 2002

Unlock Legacy Data

Source: Field Technologies Magazine

Having problems integrating your legacy systems with e-business apps? Follow GMAC Commercial Mortgage's path, and you can have the best of both worlds.

Integrated Solutions, August 2002

If you want to know why good e-business ideas die, or at least languish, you need to look no further than the legacy systems you have in place. These applications and supporting databases have served your company well for years. Now, you're asking them to play nice with the new applications and databases that will support your B2B initiatives. For most companies, this integration challenge proves to be an expensive and inexorable obstacle. And while you see the online light at the end of the tunnel, the tunnel itself is not nearly as clear.

At GMAC Commercial Mortgage (GMACCM), for instance, the loan origination, servicing, and asset management company knew that creating a host of online apps for employees and customers had all the markings of a successful IT initiative. "It just seemed like the next logical step," recalls Andrew Farkas, assistant VP of emerging technologies at GMACCM, of the project that started in 1998. "If we could make our legacy system data available to online users and for online apps, the project would be a home run."

Before GMACCM could doff its cap, however, the company had to overcome the fact that its legacy data was stored on an AS/400 in nonrelational flat files and its online apps would be supported by SQL Server. Once the Horsham, PA-based company decided that its AS/400 was staying put, GMACCM's mission was clear: find a way to make the AS/400 data fuel new apps. In successfully responding to this challenge, GMACCM has reaped tremendous benefits over the past three years. In addition to improving customer service, the company has grown its portfolio to more than $151 billion without increasing its staff. Additionally, the data once trapped in the AS/400 is now critical to the company's customer relationship management (CRM) system.

AS/400 And SQL Data Make Nice
The amount of data locked in GMACCM's AS/400 is small (9 GB) compared to the company's overall enterprise storage needs of more than 20 TB (see sidebar on page 32). But it's the AS/400 that runs the company's loan servicing application, McCracken's Strategy software. The resulting 9 GB of data are the "meat and potatoes" of GMACCM's core loan servicing business, which includes ensuring that taxes and insurance payments are disbursed, making sure the borrower is making payments, and confirming that routine loan inspections are conducted. "We handle far fewer loans than our sister company (GMAC Mortgage has about 2 million residential mortgage customers), but we service loans that range from under a million dollars to hundreds of millions of dollars. We're talking about office buildings, shopping centers, and healthcare facilities," adds Farkas.

Writing apps to reduce loan-servicing costs and improve customer service meant tapping into the company's AS/400 and its data. Or, not. Instead of using the AS/400 production data itself, GMACCM chose to implement Transformation Server software from DataMirror (Toronto). Like its name suggests, Transformation Server allowed GMACCM to transform its AS/400 data to the SQL Server environment that would now power the company's online apps. The AS/400 data remains unchanged. The SQL database is actually a real-time copy of the data housed in the AS/400. "There's absolutely no change to our AS/400 apps and data. We simply have the ability to replicate the data to an environment (SQL) where our developers and users can have access to it," states Farkas. "You can let people get at the AS/400 data without worrying about them getting into the AS/400."

Legacy Apps Pivotal To CRM, E-Business Success
With access to the previously impregnable AS/400 data, GMACCM has spent the past three years developing online apps that reduce operating costs and improve customer service. GMACCM's first project, for example, was an enhancement to the company's CRM system from NextiraOne. Using the data now available in SQL, GMACCM wrote applications to leverage interactive voice response (IVR) technology for customer service. Recognizing a combination of voice input and touch-tone keypad selections, the application provides automated responses for customers. If customers "zero out," they are routed to the appropriate representatives. "We have experts that handle a range of services for our customers," says Farkas. "If a customer needs to talk to a representative, all of the data collected through IVR is used to help the rep. The rep will know who is calling and the context of the call before picking up the phone."

That same SQL database allows GMACCM's customers to access account information online through the company's GMAC Express Mortgage Site (GEMS) application. Using GEMS, customers can check such items as loan status, payment history, and future payment dates. All of these customer inquiries used to be handled through traditional voice contacts. Now, about one-third of GMACCM's customers use GEMS to monitor and self-service their accounts.

In addition to IVR technology and GEMS, GMACCM has developed several other applications that use the 9 GB of data replicated from the AS/400. Ranging from investor queries to internal reporting packages to business partner lines of credit, these applications have helped GMACCM increase its portfolio from $75 billion to more than $151 billion in the past two years without adding staff. Additionally, GMACCM's cost per loan service, which is a key performance metric, is well below the industry average. "We have a surround and supplement mentality when it comes to technology and our users," explains Farkas. "Specialized reporting packages might have taken 10 people to produce manually. Now, we write an app that automates the process, and one person can do it. The other nine people are still here and free to handle additional business. That translates to a big advantage over our competitors."

Document Management Adds To Productivity Gains
All of the technology moves at GMACCM are part of a cultural mentality that views IT as a revenue center and not a cost center. The company's work with Transformation Server not only improves services, but frees up employees to handle more accounts. Similarly, the company's recent investment in a document management and workflow system from Hyland Software replaces tens of millions of paper documents with digital images that can be routed from desktop to desktop. Mortgage documents that used to take weeks to process are now handled in just hours. This investment, once again, allows the company to increase its customer base without adding staff.

For GMACCM, and most other companies, successfully automating processes and improving service is hinged upon easy access to data. Just keep in mind that taking a technological leap forward does not always mean discarding the technologies that made you successful in the past.