Serving the Agent Customer

Chris Steward, CIO, Arbella Insurance Group When Chris Steward joined Boston-based Arbella Insurance Group ($520 million in direct written premiums) as manager of new systems development, his initial charge was to install an agent Web site, and develop a data warehouse and management information system. Six years later, Steward is at the technology helm of the regional P&C carrier, still leading the charge to provide Arbella's more than 500 independent agents with an easy-to-use method of doing

I&T: How does distributing products via independent agents impact your overall technology decision making?

Steward: Since our partner agents are the customer-facing arm of Arbella, we manage our agent relationships much in the same way a traditional business will manage the relationships they have directly with their customers. It's important that we market to our agents, and listen and respond to their needs. That said, our partner agents are a prime focus of our technology strategy. We aim to provide agents with the ability to conduct business with us electronically and to integrate seamlessly with their agency management system of choice. We also want agents to have a personal choice about how they do business with us.

We may, at some time, provide service functionality such as policy inquiry and bill payment directly to our policyholders. But, we'll still need to preserve the agent's relationship with the policyholder, which is critical due to the complexities of providing appropriate insurance coverage. Our strategy includes building two different kinds of CRM systems - one that keeps track of our agents; the other, our insureds. The agent system will be very different from a typical customer CRM because it will include agency-specific information such as office locations and contracts that you would not normally capture about customers.

I&T: What have you done to improve agent productivity and make it easier to do business with Arbella?

Steward: We've developed our Web site over many years. We now provide access to policy, billing and claims information directly through the leading agency management systems. The Arbella Reference Center section of our Web site provides self-service capabilities to our agents, as well as access to third-party information, such as property valuations, and enables them to get answers to questions about issues such as coverages and underwriting guidelines.

Agents have online access to their consolidated financial and sales information with Arbella, so they can track where they stand versus their expectations. This is the direct result of a data warehouse initiative that was completed a few years ago and provided us with a consolidated data source. This has not only benefited our agents, but it's also become the primary source of agency management information within Arbella. Internally, we can slice and dice this information across multiple dimensions, which has been absolutely critical in more effectively managing our book of business.

Our agents continually give us positive feedback about our Web site, especially in the area of ease of use, which has been a focus of ours. We have introduced usability design and testing as a fundamental part of the Web development process.

I&T: How does your IT staff view its role in servicing your agents?

Steward: Arbella introduced the concept of customer service to the IT department a while ago, and that concept is now ingrained in everything we do. We consider everyone with whom we come in contact a customer - not just our agents. A prime example of the positive impact of our emphasis on customer service is our help desk. A few years ago, our help desk was laughingly referred to as the "helpless desk." This function has effected a 180-degree turn and now boasts enviable and ever-improving results every year. For example, first-call resolution is now over 60 percent, up from about 40 percent a few years ago.

I&T: How would you describe your technology strategy?

Steward: I would describe Arbella's strategy as "early follower." We're not anxious to venture into unproven territory, but we are very keen to utilize modern Web architectures, technologies and development methodologies. We mostly stay in previously charted waters. But, when you put all the pieces of the technology strategy together, it becomes a very up-to-date and sophisticated strategy, especially for a medium-size, regional carrier.

I&T: How has Arbella improved corporate governance?

Steward: During my early days at Arbella, prior to becoming CIO, we introduced an improved approach to new systems development. Whether or not to develop new systems became a business decision rather than a decision made by the IT department. Major initiatives need a business case sponsored by a business executive. We then present the business case to an executive group, which evaluates the costs and benefits, and determines whether to execute and fund the initiative. This enables us to evaluate all initiatives against each other and choose the most beneficial for the company as a whole.

A steering group of high-ranking executives from the affected business areas oversees each initiative. We use the same process for pure IT initiatives such as core operating system upgrades, switching wide area communications vendors or consolidating servers. Even these types of initiatives need valid business and/or financial reasons, and they must compete with other initiatives for the same valuable resources. We've since applied this decision-making philosophy to even minor system enhancements with good results.

I&T: Over the next three to five years, do you see any emerging technologies that will have a great impact on the insurance industry?

Steward: Web services and service-oriented architectures will have a dramatic effect once they get to the point of mature fruition, not just in insurance, but in many other industries as well. Using Web services, third-party providers will be able to offer insurers point solutions such as rating, property valuations and vehicle information, although insurers may need to develop some Web services in-house if a suitable external offering is not available.

I&T: How do you keep your IT staff motivated?

Steward: It certainly helps that we're working on some leading-edge technological solutions that solve very real business problems. However, I believe that what makes people stay at Arbella is our culture. That may sound trite, but in a recent employee opinion survey, our IT staff named our culture as the No. 1 thing they liked about working at Arbella.

I believe the main reason people leave organizations is because they are not getting along with somebody - typically their boss. Employing talented, hard-working people who fit into a very nice culture, and providing them with opportunities to shine, results in an average tenure at Arbella that is quite remarkable.

I&T: How do you recruit staff, and for what qualities and talents do you look?

Steward: We recruit employees from many sources, with an initial preference for employee referrals, networking or the Internet because these sources are all relatively effective, inexpensive and quick. The main quality that we look for in candidates for the IT department is the ability to work "smart." Working smart has several dimensions. The first is the ability to learn from mistakes. The second is to work hard, focus on getting to the finish line and give it your best while still keeping a healthy work/life balance. We also look for employees who can get along with others and can work as part of a collaborative team.

I&T: What is your greatest challenge as CIO of Arbella?

Steward: Undoubtedly, it's balancing expenses with delivering new technology initiatives on schedule and within budget while keeping our current systems running effectively. There is always tension among these objectives, and the challenge is to keep any one of them from getting seriously out of alignment.