Latest news with #Jatana
Winnipeg Free Press
4 days ago
- Business
- Winnipeg Free Press
MPI vows to dive deep into ‘failure'
Manitoba Public Insurance made public Thursday its decision to pull the plug on Project Nova, a $164-million 'failure' intended to modernize outdated business and information technology systems. 'We were trying to fix the plane as we're flying the plane,' the Crown corporation's CEO Satvir Jatana said. 'At this point, we need to ground the plane.' The Free Press reported in March the Crown corporation had informed the Public Utilities Board of a revised cost estimate pegged at $435 million — 50 per cent more than previously thought — to complete the ill-fated plan, and its decision to abandon the project. On Wednesday, Manitoba Finance Minister Adrien Sala asked auditor general Tyson Shtykalo to conduct a special audit of Project Nova. 'We need to get off the plane, we need to fix the plane before we can safely bring the passengers back on,' Jatana said, while promising that plans for replacing outdated technology at MPI will be done right going forward, thanks to improved governance, adhering to industry best practices that allow for flexibility and focusing on business priorities while maintaining fiscal prudence. 'That's the process we're taking right now and I am optimistic that we will have a solution, but it is not a solution that can be delivered next month,' she said told a news conference, flanked by MPI board chair Carmen Nedohin and Christian Dandeneau, chair of the MPI board's technology committee. MPI said it would fully co-operate with an audit and 'looks forward to how the results can shape our work moving forward.' Shtykalo is 'considering' the audit request on the project that began in 2019 under the previous Tory provincial government and launched in early 2023 before being officially shelved Thursday. 'I am currently reviewing the request and will seek additional information before determining what action, if any, my office will take,' Shtykalo, who was not available for an interview, said in an email. Justice Minister Matt Wiebe, who is responsible for MPI, echoed the need for a 'closer look.' 'This is about accountability for taxpayers and a significant amount of taxpayers dollars were misspent in this case,' he said Thursday. University of Winnipeg political scientist Malcolm Bird said there's been too much interference in the operations of Crown corporations by both Progressive Conservative and NDP governments. The government's call for an audit sounds politically motivated, he said. Updating IT systems is 'really, really, really hard to do anywhere — whether it's in a public-sector or private-sector area,' said Bird, who studies Crown corporations. 'You have all these systems in place working and then you want to bring in new systems,' he said. 'You have to build them and then, somehow, magically shut the one down and turn the new one on, without it being a disaster.' Jatana said Project Nova 'was never set up for success' and MPI knows what went wrong. 'There was ineffective governance, critical business requirements were overlooked, significant changes in MPI leadership, a global pandemic and an historic strike,' she said. 'These factors have led to delays and cost overruns with many starts and stops to the project.' In May 2023, the MPI board fired CEO Eric Herbelin following an internal investigation into his work conduct. The Swiss national with a private insurance background was hired during the COVID-19 pandemic in 2021 while MPI was pursuing the largest technology modernization in its history. In 2023, unionized MPI workers went on strike for the first time and were off the job for 10 weeks. An organizational review by Ernst & Young last year, ordered in 2023 by the PC government over concerns about Project Nova and financial reporting, found a litany of problems — from too many managers, to friction between divisions and significant turnover between May 2021 and June 2023. High-level organizational changes caused instability and impacted the sustainability of ongoing programs, alongside a lack of solid strategic, financial and human resources planning, the report found. Meanwhile, the projected cost of Project Nova climbed from $85 million in 2019 to $107 million to $290 million to more than $435 million, announced by Jatana in March. Targets for Autopac and commercial customers being able to renew or amend insurance policies and driver's licences online and providing connections between MPI and repair shops to speed up claims processing were missed. 'Simply put, the project timelines were unrealistic. It is clear that Project Nova has experienced significant missteps and… failures,' Jatana said. 'It has not delivered the value for money that was originally planned and promised.' She said the $164 million spent to date on Project Nova did not impact MPI customers' rates. She said the public auto insurer is locked into contracts with vendors for the project and committed to paying them roughly $88 million over the next seven years, $68 million of which would be considered of no value. 'We are hopeful and optimistic that we are in conversations with those vendors that we would be able to renegotiate those contracts and mitigate those costs.' She said there no job losses or layoffs as a result. At one time, 200 employees and close to 300 consultants were working on the project. 'Right now the numbers are very, very low,' she said, adding fewer than 50 consultants and 50 employees have been moved to 'other initiatives.' Carol SandersLegislature reporter Carol Sanders is a reporter at the Free Press legislature bureau. The former general assignment reporter and copy editor joined the paper in 1997. Read more about Carol. Every piece of reporting Carol produces is reviewed by an editing team before it is posted online or published in print — part of the Free Press's tradition, since 1872, of producing reliable independent journalism. Read more about Free Press's history and mandate, and learn how our newsroom operates. Our newsroom depends on a growing audience of readers to power our journalism. If you are not a paid reader, please consider becoming a subscriber. Our newsroom depends on its audience of readers to power our journalism. Thank you for your support.
Winnipeg Free Press
26-05-2025
- Business
- Winnipeg Free Press
MPI hits pause on part of tech overhaul
Manitoba Public Insurance will temporarily disable one of the only working parts of its abandoned Project Nova technology system because it is causing so many problems for its customers. In an email to staff members, MPI chief executive officer Satvir Jatana said the Crown corporation has decided to shut down the computer program, used for special risk-extension renewals and new policies for commercial customers, and return to the paper-based system it previously employed. 'We have identified a number of issues and our teams have been working hard to resolve these issues for our internal teams and our broker partners,' Jatana said in the email sent last month and obtained by the Free Press. 'Despite our significant investments in time and resources, especially in recent months, to move this work forward, we have not seen the improvements that we anticipated. It has become clear that attempting to fix the system while working in it is not in the best interests of our teams, our broker partners or our SRE customers. MIKAELA MACKENZIE / FREE PRESS FILES Manitoba Public Insurance will temporarily disable the computer program used for special risk-extension renewals and new policies for commercial customers, and return to the paper-based system it previously employed. MIKAELA MACKENZIE / FREE PRESS FILES Manitoba Public Insurance will temporarily disable the computer program used for special risk-extension renewals and new policies for commercial customers, and return to the paper-based system it previously employed. 'Given these ongoing issues, we have made the decision to revert back to the legacy system.' Jatana said the switch will begin June 1. Project Nova was first announced in 2020 at a cost of $107 million. It was expected to be completed in three years. Officials promised Nova would bring MPI into the 21st century in terms of digital technology, allowing its customers to renew or amend auto insurance and driver's licences online. It was also supposed to provide seamless connectivity between MPI and repair shops. Within two years, the timeline and project costs expanded to five years and $290 million. While the project's costs were exploding, then-CEO Eric Herbelin was awarding himself and others bonuses and spending more than three months away from Winnipeg on business trips. He also oversaw a massive hiring spree, adding more than 400 new staff members without a clear idea of what they would be doing. He announced that the first phase of Project Nova had been implemented on Jan. 25, 2023, declaring it would 'ultimately improve customer experience.' MPI's board dismissed him three months later. Sundays Kevin Rollason's Sunday newsletter honouring and remembering lives well-lived in Manitoba. Project Nova had been budgeted to cost $107 million when it was announced in 2020, but that price tag had swollen to $435 million earlier this year. The corporation announced in March it was abandoning the project after acknowledging it had already spent $162 million. Special risk-extension policies are purchased by owners of vehicles ineligible for basic or extension insurance, including commercial trucking firms. MPI administers about 13,000 SRE policies. Aaron Dolyniuk, executive director of the Manitoba Trucking Association, said the problems with MPI's computer system for SREs has made it difficult for companies to make financial plans. 'Has our industry been impacted? Absolutely,' Dolyniuk said. 'The challenge that most of our members have had with it is renewals being delayed and not knowing what they're going to pay. It makes it hard to manage cash flows when things become delayed.' Dolyniuk said it is especially hard for companies at a time when trucking is being impacted by American tariff threats and tightening margins. 'Nobody went bankrupt because of this, but the challenge has been the uncertainty,' he said. JOHN WOODS / FREE PRESS FILES In an email to staff members obtained by the Free Press, MPI chief executive officer Satvir Jatana said the Crown corporation will stop usuing one of the only working parts of its abandoned Project Nova technology system because it is causing so many problems for its customers. JOHN WOODS / FREE PRESS FILES In an email to staff members obtained by the Free Press, MPI chief executive officer Satvir Jatana said the Crown corporation will stop usuing one of the only working parts of its abandoned Project Nova technology system because it is causing so many problems for its customers. Grant Wainikka, CEO of the Insurance Brokers Association of Manitoba, said the system issues have made things challenging for both brokers and their clients. 'It has been difficult to deliver customer service,' Wainikka said. 'It has been difficult to communicate that coverage is in place and to communicate price increases from MPI. Many of the problems are because of the computer system that was put in place.' Matt Wiebe, the minister responsible for MPI, called it another example of mismanagement at MPI during the previous Tory government. 'For years, we saw the mismanagement at MPI and, of course, Project Nova has been a highlight of that — or a lowlight,' Wiebe said. MPI spokesperson Tara Seel said the switch to the legacy system is temporary. She said about 6,000 policies will be moved back to the old system; 7,000 policies hadn't been transferred yet. 'Once the new platform is fixed, policies will once again migrate to the new digital system,' she said, adding she didn't know when the work would be completed. Kevin RollasonReporter Kevin Rollason is a general assignment reporter at the Free Press. He graduated from Western University with a Masters of Journalism in 1985 and worked at the Winnipeg Sun until 1988, when he joined the Free Press. He has served as the Free Press's city hall and law courts reporter and has won several awards, including a National Newspaper Award. Read more about Kevin. Every piece of reporting Kevin produces is reviewed by an editing team before it is posted online or published in print — part of the Free Press's tradition, since 1872, of producing reliable independent journalism. Read more about Free Press's history and mandate, and learn how our newsroom operates. Our newsroom depends on a growing audience of readers to power our journalism. If you are not a paid reader, please consider becoming a subscriber. Our newsroom depends on its audience of readers to power our journalism. Thank you for your support.
CBC
27-01-2025
- Business
- CBC
Manitoba's public auto insurer restarting much-maligned technology overhaul after pausing it
Manitoba Public Insurance is forging ahead with its much-maligned technology overhaul project that significantly overshot cost projections, saying it paused the project last year to get a better understanding of how to deliver it. CEO Satvir Jatana told a legislative committee hearing Thursday the Crown corporation needed to take stock of Project Nova, an IT renewal project launched in 2019 that's intended to let customers and brokers complete more of their auto insurance business online. "We took a pause. We didn't want to continue because we have not been successful, I'll say, thus far," she said. "We did not want to blindly spend additional funds without truly understanding what it is that we're building, what are the needs and how are we going to deliver this." Project Nova has faced major cost overruns, with a budget that rose from $86 million to nearly $290 million over a few years. MPI has spent $162 million on Project Nova so far, Jatana said. "I can't sit here and say that we have realized the full value of that [money], so hence why we needed to pause," she said, in response to questioning from MLA Wayne Balcaen, the Progressive Conservative critic for MPI. "We needed, with this board, with this leadership team, to ensure that we don't just continue to spend ratepayer dollars without delivering value, and that's what we've been focused on." 'Lots of defects': CEO The replacement of the public insurer's outdated information technology systems was supposed to be completed this spring, but only two of the four phases are finished, and one of those phases had "lots of defects," Jatana said. She didn't reveal a timeline or cost estimate for the remaining two phases, which consists of "the majority of the delivery," Jatana said. An MPI spokesperson said Project Nova is in the midst of "a detailed planning phase that will help us understand the requirements that must be in place before we move forward with implementing any further changes." She promised MPI will reveal more details in the coming months. Asked Friday when the pause took effect, MPI wouldn't give an answer, but Jatana said at a committee hearing last March the corporation needed to "rethink [and] re-plan" the IT overhaul. She also said Project Nova's next steps would be released that spring, but that didn't happen. The first phase of the project involved shifting trucking and commercial insurance customers to an online-based platform, but it's been dogged by problems since its 2023 release. Jatana said MPI stopped migrating customers over to the new system several months later to address defects. With half of commercial customers currently using the new system and the rest continuing to use the old system, all customers are continuing to be served properly, she said. The second phase of Project Nova, which shifted the vehicle registration system for trucks and buses travelling outside Canada online, was released last summer. After the pause to Project Nova, work to fix the bugs plaguing its first phase has continued, and Jatana said significant progress has been made in the last five to six months. Frustration with lack of progress The limited progress on Project Nova stems from the corporation enduring a 10-week strike in late 2023, the subsequent work to clear the backlog, and multiple leadership changes, said Jatana, who was named CEO early last year. She said there's frustration internally, especially among staff who have worked diligently on the project. "I can never say enough to them, 'This is not you. This is the situation we put you in.'" Balcaen, the Tory MPI critic, told the committee he's glad to hear Jatana say she doesn't want to "overcommit and under-deliver." That's a trend "I've seen with this [NDP] government," he said. However, he wasn't happy Jatana said she couldn't speak further about Project Nova's future steps without permission from MPI's board, whose chairperson, Carmen Nedohin, told the committee the plan for the project still needs to be finalized. Matt Wiebe, the NDP minister in charge of the MPI file, used part of his final address to the committee to allege Balcaen was "really starting to acknowledge the mess that was left by the previous government." The sharp jump in costs for Project Nova and the corporation's attempt to hire a few hundred more staff were among the reasons the former Progressive Conservative government ordered an external review of the corporation in 2023. That audit found the insurer was top heavy and contending with instability from various leadership changes, and that Project Nova "dominates and consumes" discretionary resources. Jatana has previously said Project Nova cannot be abandoned because MPI must upgrade its outdated technologies.
