Robert Juracka
President
XDimensional Technologies, Inc.

Welcome back, Robert. Stumbling blocks for 2006?

Many initiatives in 2006 were still based on outdated presumptions and precepts. Too much emphasis was placed on specific or proprietary interfaces. By looking at current system strata inventory, as opposed to breaking down a strategy based on componentized capability, insurers are missing the real opportunities. Wiring together today’s specific systems and their proprietary input and output methodologies won’t provide strategic and sustainable interoperability. We need to think differently. More concisely, we just need to think.

Next steps?

Insurers need to consider their capabilities, not their systems. They shouldn’t think in terms of their quoting, issuance, billing or claims system. Instead they should consider their quoting/issuance/billing or claims capability. These are their strategic assets, and true synergies can be realized through the synthesis of these capabilities. What constituencies should a given capability be available to – call center, retail agencies, outsource partner? How unique should that capability be from another capability and why? Is quoting and issuance separate because they want it to be? Is that delineation constituency dependent?

A good data integration strategy?

When I see one, I’ll let you know. Kidding aside, the opportunity for leadership (and the competitive advantage that will come along with the deal) is tremendous. Insurers have great assets. Their capabilities, no matter how disparate they may be, simply work. That is a terrific basis from which to develop an integration strategy that not only works, but provides meaningful benefit and tangible advantage. By taking stock in their capabilities (not just their existing systems), and developing a plan to integrate and/or expose those capabilities to eliminate unnecessary friction/duplication, I think they can achieve a uniquely good strategy.

Straight-through processing?

Web services provide an opportunity to change the game without a wholesale change-out of infrastructure. Grab this opportunity! Look at processes with a fresh perspective! Seize your competitive advantage and reap the rewards!

John O’Connell
Principal Consultant
Interactive Business Systems

John, glad you could join us again this year. What were some stumbling blocks for 2006?

We saw two very different stumbling blocks. The first was positive, just too much to do while trying to maintain a manageable amount of change for their entire enterprise. Second, many insurance firms lacked a Strategic Technology Plan (STP) as a framework for setting priorities to obtain the appropriate project funding. Some critical projects did not move forward because there was no context in which to make the decision.

Next steps?

Identifying and delivering the quick hits that address key aspects of straight-through processing. This could be basic policy or claims information, rating and quoting, issue, or endorsements depending on current capabilities. Endorsements were a big step forward for a number of our clients in 2006. These quick hits are easier to accomplish when seen in the context of an overall plan. We worked with a number of clients to develop and present STPs to their management teams and this really helped get the resources and funding for key projects in 2007. If the management team has a vision of the technology strategy, much falls into place. Then, all the CIO has to do is deliver.

What does a good data integration strategy look like?

A lot of work. It is at such a basic level and touches most of a firm’s key applications that it should be part of its overall STP. Unless accomplished in part as an aspect of a business intelligence (BI) initiative, this is difficult to sell because there is no short-term associated return on investment. The CIO really has to have the trust and support of the management team to sell this as an initiative. Web services with an architected data integration strategy is the quickest way to have that real-time view of each customer. This forces consistent data standards while minimizing changes to core business applications. It creates organizational change and puts the architects and database group in the middle of things where they belong. This allows firms to take advantage of the converged communication infrastructure with their IT enterprise infrastructure.

One thing insurers should take away from this forum about providing innovative, straight-through processing?

Know what your competition is doing and get going. The best of breed is providing transparent straight-through processing to both the agent and the policyholder.