Consultants' Corner

5 Steps to a Seamless Linkage Between Business & IT

Deborah Smallwood
Insurance Experts' Forum, October 19, 2010

Are we still talking about business and IT alignment? Yes, but under a brighter light. At this year’s Women in Insurance Leadership Conference (WIL), this topic was front and center, but it is very clear the focus is shifting from the “what” to the “how.”

Lynn Neville, senior operations officer at Everest National, graciously accepted the opportunity to be part of a session on the topic, sharing her experiences and facilitating roundtable discussions. Our preparation for the session became a case-in-point experience for us both—one of real business and IT linkage. Lynn’s experience comes from business roles, whereas my career path has been primarily on the IT side. As we began working together, it was apparent that while we sometimes used different terminology and vocabulary, in the end, we both wanted the same outcome. We both fully understood and readily agreed upon what needed to be done. The only challenge was just figuring how to make it happen. It seems the same is true for most insurance companies. While the business and IT linkage is not perfect, it has come a long way.

During the WIL conference, Lynn and I facilitated five separate roundtable discussions, which spurred lively discussion among the participants. In sharing ideas and knowledge about critical success factors, successes, challenges and new possibilities, one thing was clear: everyone knew what needed to be done.

The following is a summary of the discussions:

1.  Create a clear, well-defined and linked business strategy and IT plan. Ensure that both a complete business strategy and IT plan have been defined and are understood by all, embraced by all and have full transparency. This linkage will enable the organization to realize the full potential that is available through the application of technology.

The challenge still is … to find and take the time to develop, share and communicate strategies and plans. 


2.  Define clear roles and responsibilities for all business and IT initiatives. Engage the right people, slot them in the right roles and give them the right sponsorship. Make sure the organization has a proper reward system—one that recognizes changed behavior and results.

The challenge still is … defining clear organizational roles and responsibilities and making the hard decisions required to put the right resources on key projects. True ownership and accountability must be clear—very, very clear.


3.  Create an effective business prioritization process. Most, if not all insurers, have more projects in the queue than they have resources to effectively address them. It is essential to have a business-driven prioritization process so that business leaders are making the decisions, rather than relying on IT to make a “go” or “delay” or “no go” decision. Many organizations have put a process in place to assist in the priority setting.

The challenge still is … for senior leaders to not trump these processes without respect for the process itself or full disclosure.


4.  Ensure proper funding to support the strategy and plan. Once a proper priority-setting model is in place, it should be accompanied by the ability to measure the capacity and capability of the organization to execute effectively. This ability goes beyond any ROI or CBA parameters, and it goes beyond dollars. Instead, it is about the skills and experience levels necessary to get the job done right.

The challenge still is … for most insurance companies, requiring a new level of skill and a new technique for resource planning.


5.  Communicate – Filtering down, up and across the organization. Full transparency of the decision-making process and the final decisions reached through the use of that process is imperative. Both successes and failures need to be shared and must have full executive visibility.

The challenge still is … taking a concerted effort, significant time and more than a fair amount of energy to communicate! Organizations just get bogged down in the day-to-day activities, pressures and demands, and simply lose sight of the importance of simple, straightforward communication.


I am encouraged and energized by the high level of enthusiasm, commitment, and determination to improve business and IT linkage. As an industry, we have indeed come a long way—now it’s time to just make it happen.

Deb Smallwood is the founder of the Boston-based SMA Strategy Meets Action, a strategic advisory firm offering research, advice, and consulting exclusively to the insurance industry.

Readers are encouraged to respond to Deb using the “Add Your Comments” box below. She can also be reached at

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Comments (1)

It never ceases to amaze that the issue of IT prioritization continues to be a topic for discussion. I don't believe there's any debate about "what" we should do. The more critical question is the how. Stating "Create an effective business prioritization process" isn't much help without a definitive description of how the process should work, who participates, and a methodology for making the decisions.

The single most important ingredient in such a process is the involvement of the CEO. Any prioritization plan evolving from such a process should be owned by the CEO. The CEO needs to treat IT as just another source of expense and capital utilization. You cannot leave the debate up to the "business", it's not a business decision, it's an enterprise decision. The CEO needs to drive the prioritization setting process as a capital and expense competition. The dollars go to the best business case, period. It shouldn't matter whether the investment is for revenue growth, a regulatory issue, a safety issue, a security issue or a productivity issue, each has an impact on the business and the officers led by the CEO are more than capable of these decisions.

This is even more true for the insurance industry where value decisions are made every day.

It is amazing how great the CIO job is when the plan you're following belongs to the CEO. You know exactly where to send the business, and indeed the officers when they complain.

Posted by: James S | October 22, 2010 11:53 AM

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