Inspiration can strike at the most unlikely times. I was reminded of this while watching a recent episode of NBC's "30 Rock." Jack Donaghy, the network executive played by Alec Baldwin, is eulogizing his late mentor and boss, Don Geiss. According to Donaghy, among the words of wisdom Geiss imparted to him over the years were these: "There is always an untapped market," and "You can always find new customers."
These phrases suddenly spark in Donaghy the idea for a new pay-per-view cable offering for women who just want an attractive man to listen to them. But they also are significant for insurance executives who are trying to determine how to generate growth and vitality in their own businesses.
Of course, in the real world, the requirement to find new customers is not played for laughs -- it's all too serious. And that's where analytics comes into play. I've heard it said that 2010 is going to be "The Year of Analytics" in financial services, and there certainly is a lot of activity on the solutions front, offering more possibilities than ever before for insurers to tap into customer, distributor, channel and product information and to do something with it. For example, a recently announced partnership between Accenture and SAS to form an analytics group focused on financial services (among several industries) aims to help companies develop, implement and manage "next-generation" predictive analytics solutions.
It's not that insurers and other financial institutions are strangers to analytics, points out John McHugh, global lead for Accenture's analytics practice in financial services. Rather, he says, "There are ... forces that are operating in the industry that add even more energy around the case for analytics -- uncertainty, scarcity of resources, complexity (regulatory, competitive, internal, external) -- and the flip side, the need for better certainty in decision making."
According to McHugh, recent research conducted by Accenture revealed that one-third of the financial services respondents "said their current technology systems actually hinder their use of enterprisewide analytics." At the same time, he adds, "Financial services executives felt their data was very accurate and easy to use -- but when they started to try to use it against problems, there were completeness [and] formatting issues."
That's why Accenture and SAS see an opportunity, McHugh notes. To leverage the data, he says, "There will be transformation work to be done at the portfolio and transaction levels."
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