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Managing How IT's Viewed

June 2007

What's the secret of running an IT department at a major brokerage? To find out, Insurance Networking News asked Fred Danback. As principal and head of global technology services for Integro Insurance Brokers, Danback is charged with developing the technology infrastructure organization.

INN: What's the most important goal of an IT department?

FD: Information Technology is a large part of a company's capital budget. The IT department has to behave like a separate company-and the most important goal of any company is to understand its market. In other words, an IT department must reflect the business strategy of its company, while also recognizing that a single company may house several market segments with differing value disciplines.

IT can be viewed as either a big expense or a significant investment. The goal of IT is to be an integral part of the business, given that it does not contribute to the overall corporate bottom line. Building IT as a microcosm of the business with transparent connections to the business objectives ensures a unified marketing plan.

INN: Where should IT focus in today's changing corporate cultures?

FD: If a company's value discipline is customer intimacy, then the IT department must build customer-intimate systems like customer relationship management (CRM) and business intelligence. If the company's discipline is operational efficiency, where margins are small but volume is high, the IT department must concentrate on offering in-house systems that generate revenue for the company as quickly and inexpensively as possible, such as supply chain management and cash-to-order processing systems.

The same principle applies to a value discipline focused on product leadership. In all of those scenarios, IT must align with the company's marketing plan to ensure it contributes to the value proposition.

INN: How would that apply to an insurance agency?

FD: An insurer must use technology as a differentiator and serve as a pioneer in customer knowledge and efficient use of technology to provide complex risk solutions to clients.

The value proposition of an insurance broker is to bring markets and clients together. That's why it's crucial that IT products enable the broker to identify and meet customers' needs.

The value is recognized at the corporate level to the extent that an IT department understands the needs of its company's varied segments and the company's myriad products and finds the most appropriate way to marry the two.

INN: What are some of the obstacles to IT success?

FD: Every IT manager has to cope with at least some of the following challenges:

* Installed Base. Existing technology can impede new technology initiatives. Legacy Technology. With deep roots in unknown places, legacy technology may not be so easy to unplug.

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