The Hype Around BI 2.0 Heralds Functionality Changes Surrounding Business Intelligence, Which Helps Insurers Gather Information to Make Business Decisions

The next generation of business intelligence tools will be integrated within business processes themselves, enabling improved forecasting and real-time data analysis.

Real-Time Intelligence

The expectation of real-time intelligence is driven by service-oriented architecture (SOA) and the open, standards-based technologies that comprise it. "SOA environments will inevitably break down silos and be characterized by enterprise systems or applications that foster consistency of information across operational systems," says Dale Strobel, senior consulting analyst with Teradata (a division of Dayton, Ohio-based NCR), which is investing significant R&D for various real-time analytics and active data-warehouse strategies. According to Strobel, there will be more of an "enterprise application" of data warehousing technologies as real-time capabilities emerge as a competitive differentiator.

Some BI experts go so far as to say that the data-driven, warehouse-centric BI of today will give way to an Internet-based environment that will be open, lightweight and distributed in nature. Instead of spending millions of dollars on IT-driven data warehouse build-outs that alienate business users rather than invite their participation, pushing key information to business users could be as easy as using a Web browser. This type of real-time, user-friendly reporting would result in real-time decision-making.

"If there were real-time capabilities, a manager could have tabs representing strategic objectives, which could be linked to functional tabs in sales, claims, underwriting, call centers and so on," explains Pat Saporito, director of insurance solutions for BI solutions provider Business Objects (San Jose, Calif.). "If data about expense ratios, loss ratios or customer satisfaction metrics could be further drilled into by middle managers looking at trends among claims adjusters, underwriters or call center agents, there could be a lot of 'what-ifing' and action alerts pushed out to the field."

Obviously, anything that enables insurers and reinsurers to better assess risk could greatly impact their bottom and top lines. "In managing, underwriting and financing risk, the ability to forecast and project into the future through predictive modeling and analysis is going to be particularly valuable," says Teradata's Strobel.

Already, S&P, Moody's and other rating firms increasingly grade insurers and reinsurers according to their abilities for sophisticated, cross-enterprise risk-management processes. More-active views of risk profiles and capital needs could help carriers stand out amid the competition.

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