Testing the Carrier/Vendor Relationship
Insurance Networking News, July 1, 2008
Despite what many insurance companies may think and desire, they cannot develop all of their systems and solutions in-house. Fraught with the typical pitfalls of overrunning budgetary and time constraints, to bogging down an already overworked IT staff, many carriers eventually decide to look elsewhere to meet their ongoing technology needs. Because of this, it’s a given that both the carrier and the technology vendor actively seek the best possible working relationship.
While maximizing the partnership is always important, one aspect of the standard vendor/carrier relationship that can be especially problematic, according to both sides, is the beta testing process.
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“There are two kinds of beta tests,” says Matt Josefowicz, director of New York-based research firm, Novarica, “one that’s part of product development for the vendor where the solution is not yet for sale, and the other is almost a proof of concept, or an internal beta test as part of a sale and implementation process.”
In either case, integral to the successful deployment of any new solution or system, beta testing can be a white-knuckle process, with harried analysts, project managers and business and IT personnel on both sides working feverishly together in an attempt to find all possible bugs, problems and concerns in a carefully specified timeframe. The carrier and vendor know the importance of the testing equally, as, in many cases, the technology being tested could be the replacement of a core system, which, if not tested properly, might make or break not only the relationship, but also the companies.
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So how do carriers and vendors make this relationship work? While it may seem obvious, the key to it all is communication.
“Communication is paramount,” says Bill Zimmerman, manager of information systems at Illinois Mutual, Peoria, Ill., which is one of a select few beta partners of Perceptive Software Inc., testing the Shawnee, Kan.-based vendor’s ImageNow document imaging software. “That was the key to our success in this project.”
Perceptive Software has a beta program available in which a small number of organizations per market segment are invited to participate. Vital to that process, says Zimmerman, is constant communication and constant feedback that includes both system and user documentation.
The vendor agrees. “It all comes down to good communication,” says Sascha Ohler, senior product manager, Perceptive Software. “In any beta scenario, you always rely on the back-and-forth between the vendor and the customer, so you want to make sure the way you communicate, and the methods being used for communication, are well thought out long before the beta program.”
Another insurer, Penn National Insurance, a property/casualty insurance company in Harrisburg, Pa., recently purchased a ratings management program from Frisco, Texas-based Skywire Software that it plans to use to eventually take over as its universal ratings engine for both its personal and commercial lines.
“The most important thing is constant communication,” says Dean Kimball, Penn National’s project manager. “We’ve found that if we’re not talking to them multiple times per week about workplans, issues and deliverables, we can get off track.”
Kimball says that during the unit test phase with Skywire, he was in contact with them almost daily. Skywire’s business analyst contacted him right away if there were any issues with the test cases. The two sides also participated in weekly project status meetings, and Kimball had weekly discussions with the corresponding project manager on the Skywire professional services team.
“It’s pretty typical in working with vendors that we generally have at least a weekly conference call with an account exec or project manager,” says Helena Vendrzyk Gordon, director of projects and planning for Penn National. “The people within the project team will be in daily contact and, in many cases, we’ve had people from the vendor located here for a period of time.
“With Skywire, we didn’t do this because it’s not typical of their methodology,” Gordon continues, “but the method we’ve used with them—Skywire having our test cases and validating them prior to hand-off back to us—has worked very well. They came on-site for a few days of meetings, but most of the work has been done off-premises. I think this has worked very well, and has helped reduce expenses.”
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