The New IT Mantra: Get as Close to the Customer as Possible
Insurance Experts' Forum, November 10, 2010
Typically, IT operations and staff have been insulated from the front lines of business, serving more of a back-end operational role. A new Forrester Research report on IT spending priorities within the insurance sector, however, suggests this role is changing, and, by necessity, IT is becoming a more visible partner in customer and market interactions.
The report, authored by Forrester's Ellen Carney—also a frequent contributor here at INN—paints an optimistic picture of “what's next” in the next phase of the economy going forward. Insurance executives have come out of the bunkers they were hiding in to weather the financial hurricane, and have emerged to face a dramatically changed landscape.
IT is being called upon to play a much more proactive role to help insurers make the most of and advance in a new globalized, hyper-competitive environment. As Ellen put it: “Carriers are getting hipper and more creative in their business strategies as they seek to engage with the coming wave of new insurance buyers through mobile and social media channels. They’re also building skunkworks to look at evolving consumer experiences as they rethink just what customer engagement means. And, yes, they are (finally) shaking up their IT strategies with injections of outside-the-industry IT leadership.”
The study, which covered 76 North American IT decision makers, found the following:
Optimism returns, somewhat: Although it is not close to the heady outlook that carriers had in 2007, nearly 30% of respondents indicated that the next year will be somewhat or very good, compared with just 9% in 2009.
Tech spending returns: About 35% respondents said they were increasing their IT spending. There will be more spending on software and new applications—activities deferred during the financial hurricane.
IT priorities shift: There's more of an emphasis on reaching out to customers. “When it comes to specific insurance industry priorities in the coming year, nearly half of IT leaders, 49%, voiced enhancing the experience for policyholders as a priority,” according to Forrester. In addition, companies want to do more with the data that comes out of these engagements. “Slightly more than 80% of insurance IT decision-makers that we surveyed stated that improving their ability to manage customer data was a critical or key strategic priority for their IT teams,” says Forrester.
Still, many IT dollars will continue to be tied up in maintenance and day-to-day operations: The Forrester survey finds that, on average, “application development, customization, implementation, and maintenance will eat into 40% of North American insurer IT budgets.” There is also a renewed emphasis on application modernization, with half of respondents planning to boost spending for this purpose.
Growing job roles for analysts and security professionals: More companies seek business analysts to help translate technology solutions into business value. Forty-five percent of the insurance firms covered in the Forrester survey say their demand for this role will increase. Another 37% expect to be hiring more security professionals.
Joe McKendrick is an author, consultant, blogger and frequent INN contributor specializing in information technology.
Readers are encouraged to respond to Joe using the “Add Your Comments” box below. He can also be reached at firstname.lastname@example.org.
This blog was exclusively written for Insurance Networking News. It may not be reposted or reused without permission from Insurance Networking News.
The opinions of bloggers on www.insurancenetworking.com do not necessarily reflect those of Insurance Networking News.
Add Your Comments...
If you have already registered to Insurance Networking News, please use the form below to login. When completed you will immeditely be directed to post a comment.
You must be registered to post a comment. Click here to register.