With Uber upending the transportation industry, Airbnb shaking up hospitality, and a host of financial services companies like Monzo aiming to unseat the incumbents, it can be a scary time to be a legacy company, whatever your current market position. Billions of dollars are flowing into startups, most of them hoping to destroy the old guard across a variety of industries.
If you’re Allstate, the insurance giant founded in 1931 with over $35 billion in revenue and an impressive spot (#81) on the Fortune 500 list, you fight back with today’s dominant currency: Developers. Unfortunately, it’s not enough to just intone “software is eating the world” or “developers are the new kingmakers” and hope for the best. As Allstate has shown, embracing developers means giving them the tools to succeed, starting with a winning cloud environment.
Give me some space
A large company like Allstate has the advantage of heft—with billions of dollars in revenue and thousands of employees, Allstate has scale of which no startup can boast. However, with heft also comes bureaucracy.
For that reason Doug Safford, vice president of technology innovation at Allstate, told me that Allstate needed to clear some space for innovation. The company did this by forming a company-wide effort called CompoZed Labs, the stated goal being to “provide fully functional technology services and products at extreme speed, improving quality and delivering beautiful business solutions that work at Allstate.”
That might sound ambitious for any company, much less a decades-old insurance giant that functions in a very conservative, trillion-dollar industry that is highly regulated. But CompoZed Labs aims to allow “parts of Allstate acting more like a startup.” Perhaps not surprisingly, as Safford told me, “Utilizing the cloud is an important part of that strategy.”
It’s a culture thing
Though “cloud” sounds like a technology shift, Safford was quick to assure me that “Culture is the hardest thing to change in a big company, regardless of the industry. It’s not about technology, it’s the culture.”
Shifting cultural expectations can be easier at the executive level, which “sees the opportunities,” he noted, and it’s similarly fixable among engineers who “see the exciting new ways of building software.”
“The biggest challenge can be the middle layers of an organization that continues to stay with the status quo,” Safford said, and that’s where CompoZed Labs helps to free Allstate’s culture to fixate on getting things done:
With CompoZed Labs, we emphasize a culture that says your job is to work on a small co-located team versus a traditional, hierarchical organization. The leader’s role in this environment is to remove friction for teams who are making decisions and developing innovative products. Resistance to change is expected. CompoZed Labs is one example of emphasizing collaboration at every level to deliver the best customer products and experience. At Allstate, we’re seeing support at all levels of the organization.
By shrinking the size of teams, Allstate is able to function more like a startup. And, while culture is critical, technology does play a big part in facilitating this cultural shift.
Specifically, Allstate uses Cloud Foundry on multiple cloud infrastructures to support the CompoZed Labs initiative. Not everyone at Allstate is on board, but enough is happening within CompoZed Labs that Safford feels things are moving in the right direction, and fast.
The reason for cloud is simple: “We knew we needed to accelerate the velocity at which we deployed applications.” However, the company also realized that there were multiple aspects to this approach. For one thing, there was the dynamically-provisional infrastructure perspective. But there was also enabling continuous delivery, enabling test-driven development, and driving automation all the way through the application lifecycle.
This all kicked off in January 2015. By the end of the year, Allstate was a “strategic player with several products built in-house.” In 2016, the company expects to be running 70% of its CompoZed Labs development in an extreme agile manner and only 30% scrum and waterfall. This translates into a massive improvement in developer productivity.
“Developers used to spend only 20% of their time coding and now it’s closer to 90%,” Safford said.
And, again, supporting this huge improvement in developer productivity is the cloud. As Safford informed me, Allstate has two datacenters running Cloud Foundry, each running a stack to support multi-availability, end-to-end, and multi-geography. This means that Allstate can now push from one datacenter a complete Cloud Foundry instance in three hours with zero human intervention, saving those developers time to build more applications that grow Allstate’s business, and not merely support antiquated infrastructure.