Growing Pains & Priorities

What is it going to take to succeed in the current high-stakes "winner-take-all" business environment - in which there is more scrutiny (from management, customers and regulators), as well as more options (technology, markets, customer segments, partners) and also more risk? Add to that more competitors and fewer resources to face them with. These are some of the questions that were debated at Insurance & Technology's 6th annual Executive Summit, "Winning in the New Age of Competition," which took place last month at La Quinta Resort in California.

The sponsors of this year's event were AQS, BusinessEdge Solutions, CSC, Deloitte, Exstream Software, Fair Isaac, Fiserv, IBM, NaviSys, Oracle, Satyam Computer Services, Steel Card, Teradata (a division of NCR), Worksoft and Zantaz.

When it comes to customer-driven growth, at Genworth Financial (Richmond, Va.), "A key element of IT strategy is understanding different goals in the areas concerning producers, policyholders and distribution partners," reported Scott McKay, CIO and senior vice president of operations and quality. He explained that Genworth puts producers' time and energy first, strives to deliver clear and simple interactions to its customers, and works to help distribution partners fundamentally grow their businesses through a "customer journey" perspective. "We are not database-centric, but touchpoint-centric so that we can analyze and improve each interaction," McKay said. Following this pattern, Genworth recommends digitizing data - not for the data's sake, but to arm employees with a "vast knowledge of products," says McKay.

Mike Battaglia, chief consumer officer at Humana (Louisville), expanded on the value of being able to "form unified contact with customers through providing a flexible way to 'choose and use' health insurance." Humana is focused on enabling and supporting customer decision-making with Web-based technology. "The level of value that health insurance brings to people is often opaque to consumers," related Battaglia. "What we have to do in this approach is actively leverage customers by opening up the field of choice and use Web-based tools to empower the end user."

Tapping Into the Field Force

These kinds of customer opportunities can only be leveraged via an effective distribution channel, and at New York-based AXA Financial this has translated into the multifunction AXA Web Station, which is dramatically improving client management and cross-selling capabilities, according to senior vice president Mark Wutt. The system now gets at least 70,000 hits a month, and by the end of this year a national branch-by-branch rollout will be completed. Key to the project's success has been "ongoing field input" and involvement, noted Wutt, who added (jokingly), "If they don't like it now, it's their fault."

Mergers and acquisitions are another growth tactic being weighed in the insurance industry, and two M&A veterans offered their perspectives. Phil Lambert, CIO of Mitsui Sumitomo (New York), identified the concept of "a principle-driven definition" of project scope - in which IT would deal only with what was "absolutely essential" - as a key factor in the merger process of the two organizations. At the same time, the guiding principle from a technology standpoint was risk reduction. "We took the middle of the road," Lambert noted. "We have the rest of our lives to be bleeding-edge."

Bob Best, EVP and CIO of UnumProvident (Chattanooga, Tenn.), recalled that the challenges involved in merging Unum and Provident in 1999 included staff retention, leadership ability at a time when "people who can handle ambiguity are critical," and the fact that the merger partners previously had been "fierce competitors with different cultures." By making choices quickly and communicating aggressively, by the time the merger process was completed, "The role of IT had achieved greater significance and influence, post-merger," Best reported.

Another highlight of the Executive Summit was the 2004 Elite 8 Awards Dinner. This year's honorees were: UnumProvident's Bob Best; Barbara Piehler, Northwestern Mutual; Steve Sheinheit, MetLife; Michael Connolly, Aetna; Doug Reynolds, Allianz Life; John Chu, The Hartford; Bob Wilkes, CSAA; and Todd Ellis, Chubb.

Two honorees, Bob Wilkes and Steve Sheinheit, faced off in a spirited "Get to the Point!" session. When asked, "Does IT matter?" - in the spirit of Nicholas Carr's notorious article - Wilkes replied, "The question has to come from the organization: What is IT's responsibility to the company's strategic vision?" If IT is thought of as simply a maintenance-oriented organization, then it doesn't matter, Wilkes suggested. But, he argued, "We should think of IT as a component of [a company's] overall strategy."

Sheinheit addressed the question by asking for a show of hands from the Executive Summit attendees who believed that IT mattered. "If your hand is not up," he said, "find a new job!"

For information about the 2005 Executive Summit, please visit I&T's Web site, www.insurancetech.com.