About VHV Gruppe
The VHV Gruppe, headquartered in Hanover, Germany, is an international insurance group focusing on property/casualty and life insurance. More than 4,000 employees work for the brands "VHV Versicherungen", "Hannoversche" and "VAV Versicherungen" (Vienna) as well as for other international companies.
The Challenge
As early as 2019, the VHV Group decided to adapt its IT landscape to modern technologies, taking on a pioneering role in the field of cloud transformation.
The main challenges that had to be overcome in order to move to the cloud were:
- The existing on-premises tech stack (servers and resources) - not only for internally developed applications - limited the company's agility. Long release cycles, limited scalability, and the high cost of provisioning new environments make it difficult to respond quickly to new requirements and market conditions, resulting in extended time to market. New products and services come to market too slowly.
- The cost of managing the on-premises infrastructure is high. In particular, tasks such as operating system patches, software deployments, and data transfers consume valuable resources.
- On-premises infrastructure is expensive to operate, with high hardware and licensing costs.
The Solution
To meet this challenge, the VHV Group's cloud journey is built on three pillars: strategy, transparency and enablement.
The VHV Group's IT strategy is "cloud opportunistic". This means that the VHV Group uses the opportunities offered by the cloud wherever it makes technical and economic sense. The use of cloud technologies has already been anchored as a central component of VHV's IT strategy for 2019. Cloud technologies and AI have been proven to accelerate innovation, increase value and reduce costs in previous projects.
Instead of blindly moving workloads to the cloud, VHV understands that transforming an IT landscape that has grown over decades takes time. The current focus is on (re)hosting legacy and new systems and refactoring applications, while at the same time examining optimization potential in its own data center.
Various measures are being taken to ensure transparency.
An important issue for the insurance group is adherence to regulatory requirements and compliance guidelines, such as data protection, information security and contract data processing, when using cloud technologies.
In order to meet these requirements, the VHV Group is implementing the following measures, among others, in a multi-stage process
- Create a VHV-specific technical cloud framework that meets regulatory and compliance requirements.
- Creation of a VHV-specific organizational framework, including an Audit & Compliance Assessment Tool (ACAP), and extension of the existing VHV PPM framework with a customized Cloud PPM framework for the Cloud team and the specialist departments, developed together with partners PCG & PerfectJourney.
All steps are planned with a special focus on fast and targeted enablement. Through measures such as a company-wide VHV Cloud Day, so-called GameDays for developers, individual workshops with AWS and partners, as well as a Cloud Competence Center (Knowledge Base). A dedicated cloud team supports and advises the respective (IT) departments on a technical and technological level.
The goal of the cloud strategy is ease of use with high benefits and low overhead. Continuous monitoring and reporting of cloud activities as well as their governance and control are other important aspects.
The VHV Group prioritizes value creation, such as benefits, cost savings and time-to-market, as well as continuous improvement and optimization through measures such as automation and the use of innovative technologies (e.g. AI). Ensuring regulatory compliance is a top priority.
Results and Benefits
Putting a Cloud Strategy into Practice
Stage 1: Organization
Comprehensive guidelines and instructions for using the cloud ensure safe and efficient handling of the new technology, such as cloud operations manuals, developer guidelines and security blueprints.
In addition, the Cloud PPM Framework complements the existing VHV project management framework and enables customized, pragmatic and lean project and initiative management for the cloud team and business departments. This framework is based on established standard tools such as Atlassian Jira, Confluence and MS Sharepoint.
To meet regulatory and compliance requirements, the framework is supported by ACAP (Audit & Compliance Assessment Portal), a cloud self-service/governance tool. ACAP ensures that VHV compliance policies are adhered to for all cloud projects.
Stage 2: Infrastructure
SAP on AWS
The migration of SAP workloads to the cloud (AWS) became necessary because the global chip crisis prevented the timely procurement of new server hardware for SAP S/4HANA. The existing infrastructure was simply too expensive and complex to transform and migrate the SAP landscape to S/4 HANA. By using AWS, the VHV Group was able to not only overcome the challenges of the chip shortage, but also reduce the cost of operating the SAP landscape while increasing flexibility. The automation of processes such as provisioning and system copies, as well as the implementation of a robust and cost-effective disaster recovery concept, contributed significantly to the success of the project.
Transforming the AWS Landing Zone into the AWS Control Tower
As part of the cloud infrastructure modernization, the existing AWS Landing Zone was transformed into the AWS Control Tower. The previous Landing Zone was characterized by a high degree of customization, resulting in complex and costly management processes. To simplify administration and reduce costs, the project redesigned the landing zone and migrated it to standardized AWS services. By using AWS Control Tower and the Security Reference Architecture, VHV Group was able to further enhance the security of its cloud environment.
Stage 3: Application, Data & AI
In recent years, the VHV Group has consistently invested in the development of forward-looking IT solutions.
The VHV Group's data science platform was originally based on an on-premises solution, which resulted in high hardware and maintenance costs. In addition, there were problems connecting data sources and the security of the platform was critical. To address these challenges, a new, future-proof data science platform based on Dataiku was implemented in the AWS cloud. The new platform offers greater ease of use, enables the use of new technologies such as AI and data analytics, and reduces costs through a flexible pay-as-you-go model. During the project, it became clear that a comprehensive design and detailed proof of concept were essential to manage the complexity of the new platform and meet usability expectations.
With the migration of the rate calculator to the AWS cloud, the VHV Group has successfully launched another modernization project. The previous on-premises operation of the rate calculator was associated with high costs and low agility. By moving to a serverless architecture in the cloud, VHV Group can reduce operating costs by 90% while significantly improving time to market. The project demonstrated that the cloud not only provides cost benefits, but also accelerates the development and deployment of new functionality. In addition, the cloud's transparent cost structure has helped uncover and eliminate inefficiencies in the rate calculator code.
These projects show that the VHV Group is consistently and successfully implementing its cloud strategy. By using cloud technologies, artificial intelligence and modern software development methods, the VHV Group has been able to modernize its IT landscape, increase agility, reduce costs and at the same time improve quality and security.
Since the beginning of the cloud journey, PCG has been trying to enable and support the VHV Group with its questions and challenges. Initially, these were fundamental issues such as security, compliance, backup and monitoring, in which PCG was able to help VHV gain experience.
The two teams now discuss and develop specific workloads or business scenarios that are implemented in parallel. PCG experts are often seamlessly integrated into the VHV team as partners - together with AWS. There is no standardized collaboration; each new topic is developed together with an open mind. They are even discussing whether VHV will continue to use AWS support services in the future or whether PCG will provide optimal support at the partner and support level.
About PCG
Public Cloud Group (PCG) supports companies in their digital transformation through the use of public cloud solutions.
With a product portfolio designed to accompany organisations of all sizes in their cloud journey and competence that is a synonym for highly qualified staff that clients and partners like to work with, PCG is positioned as a reliable and trustworthy partner for the hyperscalers, relevant and with repeatedly validated competence and credibility.
We have the highest partnership status with the three relevant hyperscalers: Amazon Web Services (AWS), Google, and Microsoft. As experienced providers, we advise our customers independently with cloud implementation, application development, and managed services.