Though the insurance industry continues to grapple with the challenges of eliminating paper from critical business processes such as sales, policy processing and claims, evidently the world of academia already has figured it out. A recent article in The New York Times reported that within the next few months, almost all of the University of Texas at Austin's 90,000 books will be moved from the institution's undergraduate library to other university collections. The purpose is to clear about 6,000 square feet of space for a 24-hour "electronic information commons."
UT is not the first to adopt this strategy; according to The Times, the first such facility was created in 1994 at USC. Today, as Fred Heath, vice provost of the University of Texas Libraries in Austin, noted in the article, "In this information-seeking America, I can't think of anyone who would elect to build a books-only library."
Oh, where to begin? Let's put aside for now any philosophical musings about the state of higher education, college students' attitudes or the decline of reading. What is instructive for insurance companies is that in the space of a decade, many colleges and universities - not a sector with a lot of money to burn on big-ticket investments, endowments notwithstanding - have transformed a key aspect of what might be called their distribution systems. Recognizing that student (customer) expectations have changed, information and resources are being delivered in a significantly different manner. Books have not been replaced (at least not yet), but now there is an alternate channel.
It has taken a long time for the insurance industry to shift to today's still-evolving multichannel distribution model, and even longer for core operations and processes to become less paperbound and more efficient. However, it's no longer a discretionary approach to reducing costs - increasingly, it's what customers (especially those future customers who currently are spending time in their campus electronic information commons) expect. There have been significant technology obstacles, but, increasingly, it seems that the biggest challenges are cultural. The organizations that are able to master the technology requirements and also overcome the cultural obstacles will have the competitive advantage. The rest may well have to go back to school.
Katherine Burger is Editorial Director of Bank Systems & Technology and Insurance & Technology, members of UBM TechWeb's InformationWeek Financial Services. She assumed leadership of Bank Systems & Technology in 2003 and of Insurance & Technology in 1991. In addition to ... View Full Bio