Cargill Embarks on IT Overhaul

Like many large multinational corporations, several years ago Cargill Inc. noticed that it was experiencing IP problems arising from topsy-turvy growth. Rather than the quick-fix, Cargill's IT infrastructure required a complete overhaul.

• 09/01/2000

Minneapolis-based Cargill Inc. may not be a household name, but its more than 85,000 employees within 103 business units operating in 60 countries worldwide focus on marketing and distributing agricultural, food, financial and industrial products through a multitude of activities.

Like many large multinational corporations, several years ago Cargill noticed it was experiencing IT problems arising from topsy-turvy growth. Because the company’s business units adopted solutions independently, IT had not been able to develop an overall focus. Moreover, some computer systems and solutions needed replacing, and system management was inefficient, causing IT to experience difficulty in meeting service level agreements.

Clearly, Cargill’s IT infrastructure required an overhaul. The company needed to develop systems that allowed its business-specific applications to work across multiple business units. It also needed to replace and consolidate its 16 outdated e-mail systems with one centralized communications solution.

Finally, it had to find a way of managing its business tools to guarantee service level agreements (SLAs) and improve efficiency throughout the company.

Cargill’s first step in dealing with its IT challenges was to bring in Lloyd Taylor as CIO. A firm believer in creating competition among IT suppliers, Taylor began to move Cargill away from its mainframe environment and into a client-server architecture based on UNIX and Windows NT servers, networks and open systems. Cargill chose to standardize its UNIX systems on HP-UX, consolidating and upgrading from HP 9000 E-Class, H-Class and I-Class servers to HP 9000 K- and N-Class systems. And it gave IBM its business for desktop and Intel-based systems.

Developing Frameworks to Encourage Standardization

To encourage divisions to standardize solutions, Cargill set up Centers of Expertise (COEs) around frameworks in areas like ERP, plant systems and integration. The idea was that business units looking to implement particular solutions would call upon the appropriate COEs for advice in linking applications, best practices, benchmarking information and so on.

Cargill’s ERP COE was built upon a framework developed by Alistair Jacques, now Vice President of IT. Jacques developed the framework when implementing an ERP solution for Cargill’s oil seed processing unit. For the ERP solution, Jacques selected QAD’s MFG/PRO as the core application, then added best-of-breed solutions from vendors like Nu-Metrics, Manugistics, J.D. Edwards and others.

That led to the need for an application integration framework. "Our purpose was to develop a standard for the way in which applications could talk to one another," says Jacques. "Then, we could build a set of adapters and keep them on the shelf. So, if anybody decided to link J.D. Edwards to QAD or Manugistics to Numetrics, we’d have an off-the-shelf solution for making the products work together."

Cargill and HP worked jointly to build an Application Integration COE. "We suggested the idea to HP," Jacques says, "and HP said, ‘That’s absolutely wonderful. Let’s build it together.’ We put in several million and they put in several million, and we built an application integration framework together."

Cargill’s idea was that the application integration framework developed through its work with HP Consulting would eventually be marketed by HP as a commercial product, but that never happened. "We ended up owning it, and we’ve been using it for five years," Jacques says. "It works great, even though the market has caught up with us and we can now go to packaged solutions that provide the same functionality."

"Through the COE," says Linda Ergen, manager of Cargill’s Application Integration Center of Expertise," our oil seeds business developed significant application integration expertise. The integration was so successful that Lloyd Taylor then decided to make this expertise available across the company. "Now, whenever a business division needs to incorporate or update a software product, the COE helps it select and implement the best middleware solutions to make the integration a success," Ergen says.

The COE is a valuable resource for Cargill’s divisions in part because it is staffed with technical consultants. "We contract with the divisions to provide architecture and technology strategies, development resources, the production environment and 24x7 application integration support," Ergen says.

Although Cargill won’t disclose figures about the COE’s return on investment, the center has significantly reduced costs. "Roughly 30 to 40 percent of spending on ERP projects is consumed by integration costs," Ergen points out. "When you have ERP projects in the tens of millions of dollars, even if you shave as little as 10 percent off the integration costs, you can bring a seven-digit number to the bottom line."

Another of Cargill’s IT tasks was to find a way to link 29,000 of its employees through a consolidated, efficient e-mail system. Cargill also had to look to the future and select an e-mail system that could grow to accommodate its remaining global employees.

In 1994, the company unveiled an OpenMail solution running on HP 9000 E-Class, 9000 H-Class and 9000 I-Class servers.

"From both an administrative and enterprise server point of view, we believed our best option was HP OpenMail running on the HP-UX platform," says Warren Schlichting, Cargill’s Global Infrastructure Applications Corporate Information Technology Manager.

"Prior to implementing HP OpenMail, we had more than 16 different e-mail systems because all our divisions were using locally developed and implemented solutions," Schlichting explains. "Then corporate headquarters tried to tie all these systems together so that they could talk to one another. That left us with a very complicated mesh of gateways and bridges to the different systems, and capabilities that varied dramatically from one system to another."

While the HP solution has helped Cargill consolidate its messaging systems, the jury is still out on OpenMail, according to Jacques. "OpenMail is a wonderful product," he says, "but it’s best when you have consistency across the board in your configurations. We don’t, and we can’t, because we’re so broad and so diversified worldwide. We don’t have a single directory for the organization – we have 30 directories for the Minneapolis operation alone and more than 500 worldwide. It’s possible that OpenMail isn’t flexible enough to use relative to our applications infrastructure."

Jacques’ doubts about OpenMail have also been reinforced by HP’s decision to use Microsoft Exchange for its own internal messaging.

Cargill won’t be making any decisions about messaging right now. "Our messaging decision will be considered as part of a broader analysis of our next-generation computing strategy. That will include network, hardware, operating systems, office tools and messaging," Jacques says.

To address another item on Cargill’s agenda – system management – CIO Lloyd Taylor formed a council made up of IT managers from the company’s different business sectors. The council’s purpose was to analyze specific problems and create a companywide IT strategy for enterprise management.

After almost a year of work, the IT managers identified the resources requiring companywide management. These resources ranged from devices on the network to operating systems to specific applications. Cargill then created the Systems Management Environment (SME) to identify appropriate system management tools.

"The goal of the SME program was to have common enterprise management tools and processes used across Cargill’s business units as well as at each of the company’s four regional support centers," says Carla Hawley, the developer of SME.

"Prior to the program, individual business units took a best-of-breed approach to enterprise management," Hawley explains. "When Cargill started bringing in client-server applications a few years ago, the company’s business units began installing a lot of different off-the-shelf tools for enterprise management. At one point, there were 47 different tools being used, and very few were productive."

Cargill chose HP OpenView and combined it with Microsoft SMS (System Management Server) for the desktop. "HP was willing to partner with us in ways that others just weren’t, such as pricing and enterprise licensing," Hawley says. "That made a big difference in our decision to go with HP."

Working with HP Consulting, Cargill implemented OpenView Network Node Manager for global network management, Optivity for managing its Bay network hubs and IT/Operations [now VantagePoint Operations] for event management on its HP 9000 servers and Windows NT boxes.

"We also use HP OpenView IT/ Administration for collecting inventory on our UNIX servers and Software Distributor for software distribution to our HP 9000 servers," notes Hawley.

The SME was Cargill’s first global infrastructure program. "The return on investment on the SME project was planned for 19 months," Hawley says. "However, it will probably be quicker due to substantiated cost avoidance ... the biggest benefit we’ve seen using HP OpenView is the ability to leverage across all business units."

On the whole, Cargill is pleased with its relationship with HP. "The servers are great," says Jacques. "Technically, HP is second-to-none."

CIO Taylor says, "Our people are more productive, our systems are more efficient, and our processes are more cost-effective. We now share and transfer information better across business units. We communicate better whether it’s across the hall or around the world. And we’re able to consistently meet our service level agreements."