UnumProvident ($42.4 billion in assets, Portland, ME, and Chattanooga, TN) is the result of the 1999 mergers of Unum and Provident, as well as earlier acquisitions of Colonial Life and Accident (Columbia, SC) and Paul Revere (Worcester, MA). The IT consolidation effort was led by Bob Best, a 20-year veteran of Colonial Life and Accident. From April to August of 2002, Best assumed the role of interim president of Colonial, while he maintained his duties at UnumProvident.
I&T: What were some of the challenges of juggling your role as UnumProvident's CIO and SVP of customer service while acting as interim president of Colonial Supplemental Insurance? How has your business/IT experience helped you with these challenges?
Bob Best: I spent a long time at Colonial as part of my career. And actually, 10 years ago I also held the role of interim president. I kind of grew up at Colonial. I knew a lot about its processes and its distribution system and marketing pieces. So it wasn't like going into a totally different piece of business or part of our company that I had no experience with. Part of the challenges associated with juggling the roles was the time issue. During the four months that I spent back at Colonial I was kind of restructuring things and pulling together a new management team as well as overseeing some different initiatives. It was certainly a time crunch but luckily I have two deputy CIOs: Kathy Owen and Brent Rogers. They are very experienced and we have worked together for a fairly long time. They were very helpful and stepped up to the plate to take a much bigger leadership role. In addition to their help I had the support of leadership in the customer loyalty services area-a 3,200-person organization.
While I was interim president, I spent most of my time at Colonial in Columbia. Communication with our Chattanooga corporate office wasn't a problem because we have some pretty good communication technologies to help keep in touch. Also, UnumProvident is very geographically diverse, so we are used to operating in multiple locations and not dealing with people face-to-face constantly. It wasn't totally outside the normal realm of how we do business.
I&T: Now that your tenure as interim president has ended, what knowledge/experience do you have that will help you at UnumProvident and throughout your career?
Best: Probably a pretty basic grasp of the knowledge that you should never lose sight of the people part of the equation. It's a very important part of our business. Being a large insurance company, our product is basically our peoples' knowledge. We are not making tangible things like refrigerators or airplanes or cars. Our product is embedded in our peoples' minds. It's important to never lose sight of the importance and value of that-whatever the endeavor or discipline. The most important lesson that I've learned is certainly not a technical piece nor is it a specific piece of knowledge, just the understanding of the value of having strong people working with you.
I&T: How does your business experience benefit business/technology relations at UnumProvident, especially when it comes to planning for strategic technology spending?
Best: It's good to be grounded on the business side. In order to be successful, UnumProvident-like other companies-has to have a business-driven IT plan, one that generates good returns, customer satisfaction and supports a lot of customer reengineering efforts and very strong business applications. Our 3,200-person customer loyalty operation comprises about 25 percent of the total employees in the company. Having responsibility for the customer loyalty operation and a continuing role as chairman of the Colonial companies keeps me grounded in terms of what is going on in our business and making sure that our IT plan is very much aligned with the business priorities. We have had in place for a number of years an IT steering committee and we meet several hours monthly. It's chaired by our CEO, Harold Chandler, so staying involved with that and going through our prioritization and ourplanning processes helps in the IT organization. I think people know there is value to having a leader in place that is grounded from a business perspective.
I&T: A year ago you reported that UnumProvident planned to invest in initiatives involving portals, the Internet and growth engines. Has the company been able to embark upon these kinds of e-business initiatives?
Best: We probably have a three- or four-part approach with different portals. We are making pretty strong investments in a Web service that we call Producer Connect. We have a lot of our commission statements now available through the Web and other types of Web-enabled services to our 100,000-plus producers who we do business with. We met with the top-100 producers recently and as part of that meeting we had a two- to three-hour workshop and a trade show. The workshop was really oriented to what we call our I-Services Initiative, which are basically Web-enabled service suites. The feedback was just tremendous.
Also, one of UnumProvident's targets this year was to have 10,000 core market accounts on a Web-enabled platform. It provides booklets to our employees via the Web, as well as a plan administrator guide and all the billing transactions and the premium remittance via the Web. Our goal was to have 10,000 customers by the end of this year, and we have already surpassed that by about 50 percent. We did some mass mailings and some good marketing and set up a call center, whereby plan administrators can call in and we take them through a nice customer experience to get them on the I-Service platform. The platform will become our standard offering, so when new customers come on board with us, they will pretty much have the use of a 100 percent Web-enabled platform if they so choose. The response has been outstanding.
When a lot of Web activity was going on in the marketplace several years ago, our companies were being merged and we were working on other things at that time. Because of this we got out of the gate a little bit later, but it probably actually helped us, because instead of just jumping on and building applications that were not scalable-like a lot of companies did and we were tempted to do just to have something out there in the marketplace-UnumProvident had to wait. The merger actually allowed UnumProvident time to make the right investments, get the right people in place and build the effective, scalable infrastructure that we now have in place.
I&T: Has the economic downturn impacted your competitive advantage? Can UnumProvident, because of its market position, afford to not spend aggressively on IT during a time when the entire industry is working with limited financial resources?
Best: Our IT investments for next year will be the same, if not slightly more than they are for this year. The recession challenges companies in different ways and we certainly are challenged like every other business. But we've had a very good investment strategy in place since the mergers. We are not a company that will spend wildly one year and cut back the next. We have had a pretty consistent plan and we are sticking to that and it was ratified last month. You won't see us making huge investments one year and then cutting back the next, both from a technology and also from a people perspective. We constantly reengineer things, we always have four or five ongoing process reengineering initiatives that we support in the business areas to get at efficiencies. I don't think you'll see us act like other insurers that start slashing and burning all of the sudden and do some reacting. One thing mergers will do: They will make you be very disciplined with your planning, and establish short- and long-term plans.
I&T: What are some challenges in the disability, long-term care and supplemental health insurance space?
Best: It's kind of a niche business, so lots of knowledge and scale is needed. Technology is also very necessary. Just the normal paper flow requires lots of imaging technology and workflow tools. It's an information- and data-intensive business.
Lots of the tools that UnumProvident uses are built around a Teradata (Dayton, OH) warehouse. Customer information, operational information and financial and product information is obtained through the warehouse. The data is consistently defined, which helps to make information more accurate and accessible to all of our customers.