IASA News: CIOs Bear Alignment Burden

Insurance company CIOs, as opposed to their business counterparts, have a responsibility to drive greater alignment of business and IT objectives and activities, according to participants in the CIO Roundtable held at the 2005 IASA annual educational conference and business show in Anaheim on Tuesday.

"It's important to have IT individuals assigned to the business units to aid in communication and understanding when building an IT delivery model," said Brian Coffey, vice president and North American practice head, enterprise applications and business intelligence practice, Satyam Computer Services (Alpharetta, Ga.).

Coffey theorized that, in fact, IT is an instrument of business rather than a core competency within the insurance enterprise, and thus business knowledge was, in many respects, a more crucial differentiator for an IT leader than specific technology skill sets.

Paul Zahensky, vice president information systems, Syndicated Services Company (Manchester, N.H.), complemented Coffey's argument by asserting that the likelihood of IT personnel learning the business aspects of the company is greater than that of business-centered employees learning the details of IT. Nevertheless, achieving alignment requires a degree of bridge building between both sides of the IT/business divide, Zahensky argued. "We bring business analysts into IT to ensure they understand the business side," he said. "When we were building a reporting module, for instance, even the business side had trouble explaining core concepts to IT, so we brought in consultants to help with the learning curve on both sides," Zahensky continues.

Craig Lowenthal, vice president and CIO, Hartford Financial Products (a subsidiary of The Hartford, $187 billion in revenue, New York), echoed the need to achieving understanding across the disciplines. "We have our IT folks shadow underwriters to see how they use the system," he related. "It exposes weaknesses in the system and allows us to look at IT through its effect on people," he continued.

Technology selection should be IT-driven, while the business side should decide what data needs to be managed, according to Gordon Karber, director of information systems, CompSource Oklahoma ($172 million in surplus, Oklahoma City). "The decision should be integrated, but business should defer to IT on platform," said Karber. "IT creates the tools for business to manage data and gives them the ability to manage the way they need to."