Crossing the Great IT/Business Divide
All too often during the past decade the opportunity for technology to support the insurance business in new ways has meant similarly novel opportunities to waste money. One of the principal causes of that waste has been the lack of mutual understanding between business and technology -- business professionals lacked the criteria by which to evaluate the suitability of any given technology for their operational needs, and technology people had little insight into the arcane ways of the insurance business.
Both the frequency and magnitude of project failures have drawn attention to the problem, resulting in significant progress toward bringing the business and IT together through the proliferation of business-trained CIOs and the widespread establishment of more-rigorous governance and project management processes, for example. But perhaps the most decisive resources in closing the gap between the business and IT are the personnel who act as a bridge between those two camps -- typically business analysts. >>
The role of business analyst has been around for a long time, but the revolution in technology's utility for the business has made the demands on the role far more exacting. It's clear to most insurers that to avoid the hazards associated with "throwing a project over the wall" -- and never being sure about what is likely to be delivered when it's thrown back -- they need people steeped in the business, knowledgeable about technology and experienced in project discipline. But how those people are best groomed and where they fit within the enterprise is an unsettled matter, varying with both internal considerations of company culture and size, and external factors associated with the continuing evolution of technology. That makes it hard to generalize about how a particular company should position its IT/business "bridge builders," but it only underscores the importance of cultivating these professionals one way or the other.
Companies first have to ensure that the conditions for the success of those individuals exist. The foundation of IT/business alignment is an IT strategy that is congruent with business strategy and has the full support of the business, according to Paul McDonnell, senior vice president and U.S insurance segment lead, BearingPoint (McLean, Va.). Above that base should sit an IT planning process calibrated to the changing needs of the business. At the top, business and technology unite in the effective execution of projects within a defined business architecture -- and that's where it all happens.
Critical Resource
"The people who use that architecture and are probably the most critical resources for the success of those projects are the business analysts," McDonnell says. That is especially true today, considering insurers' focus on major initiatives related to compliance, business process automation and service-oriented architecture (SOA), he asserts. "Everybody wants to talk about the technology involved with SOA, but the technology is only 20 percent of the story," McDonnell observes. "When you look at the tasks that insurance companies have set for themselves, they have a heavy dependence on these resources."
One of the difficulties of feeding that dependence is that effective business analysts are made, not born -- they are bred through years of experience within a particular company's business combined with an education in that company's technology capabilities. An appreciation of that genesis increasingly is influencing insurers to formalize the business analyst's career path, according to Don Laackman, senior executive, insurance practice, Accenture (Chicago).
"We've seen IT departments building competency frameworks and different career development towers, or tracks, for IT professionals, and there's an increasing recognition that you need a business analyst tower," Laackman says. It is only with such a formalized track, he adds, that companies "will attract and retain the right kind of people who understand the technology issues and engage with the business to communicate how to translate technology advancements into business advantage."
Anthony O'Donnell has covered technology in the insurance industry since 2000, when he joined the editorial staff of Insurance & Technology. As an editor and reporter for I&T and the InformationWeek Financial Services of TechWeb he has written on all areas of information ... View Full Bio
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