Case Study Highlight: Transitioning to Agile at Unum

Mitch Wein

As we approach the announcement of the Novarica Impact Awards in the fall, we will be highlighting one Impact Award nominee each week on our blog. The Novarica Impact Awards are voted on by over 300 members of the Novarica Insurance Technology Research Council, making them the only purely peer-reviewed awards program in insurance technology.

Many of the 2016 Impact Awards nominees cited cross-functional teams, with resources familiar with multiple business areas, and the use of Agile methodology as keys to a quick and successful delivery. Common among many projects was a focus on operational transparency, overcoming internal challenges, improving relationships, and cost savings.

This week, we look at an Unum initiative to transition to Agile.

Unum wanted to drive growth and adapt to evolving customer expectations. An Agile operating model would allow Unum the flexibility to quickly respond to market changes and deliver increased value to business partners. The multi-year project began in 2014 and by the end of 2015, Unum had established all Agile teams and trained 85% of members. While adjusting to cultural and organizational change was a challenge, the project team notes that empowering employees to help define and influence areas of change was key to the success of the initiative. Strong leadership, commitment from business partners, and transparent communications were also important to incorporate feedback and course-correct as needed.

For more detail on this project and more than 30 others, including cases from Glatfelter, Prudential, The Hartford, and Homesite, see Novarica’s Best Practices Case Study Compendium 2016.

Case Study Highlight: Enterprise Operational Analytics at Trustmark

Rob McIsaac

As we approach the announcement of the Novarica Impact Awards in the fall, we will be highlighting one Impact Award nominee each week on our blog. The Novarica Impact Awards are voted on by over 300 members of the Novarica Insurance Technology Research Council, making them the only purely peer-reviewed awards program in insurance technology.

Many of the 2016 Impact Awards nominees cited cross-functional teams, with resources familiar with multiple business areas, and the use of Agile methodology as keys to a quick and successful delivery. Many projects focused on consolidation and speed, combining disparate data silos and core systems to enable centralized access and real-time querying.

This week, we look at a Trustmark initiative to enhance enterprise operational analytics.

The Trustmark Voluntary Benefit Solutions Division needed improved information management and analytical capabilities in order to make better business decisions. The organization created dashboards to track progress against operational KPIs with the goal of aligning analytics with enterprise objectives. The 12-month project utilized Agile methodology and resulted in the creation of a “data-driven culture”, both of which the team cites as critical to project execution. The team also attributes success to business leadership, as well as the use of concrete goals and metrics to improve data architecture and quality. As a result of the initiative, complex payment processes were reduced from 35% to 26%. The project also reduced past-due bills by 18% and reconciled over $1 million in missing payments.

For more detail on this project and more than 30 others, including cases from Amerisure, Tokio Marine HCC, Glatfelter, and Merchants Mutual, see Novarica’s Best Practices Case Study Compendium 2016.

Case Study Highlight: Core Systems Replacement at CSAA

Chuck Ruzicka

As we approach the announcement of the Novarica Impact Awards in the fall, we will be highlighting one Impact Award nominee each week on our blog. The Novarica Impact Awards are voted on by over 300 members of the Novarica Insurance Technology Research Council, making them the only purely peer-reviewed awards program in insurance technology.

Many of the 2016 Impact Awards nominees cited cross-functional teams, with resources familiar with multiple business areas, and the use of Agile methodology as keys to a quick and successful delivery. Many projects focused on systems consolidation and speed, combining disparate core systems to improve product development and time to market.

This week, we look at a CSAA core systems replacement initiative.

Multiple acquisitions and expanded partnerships among AAA regional clubs left CSAA with a large, complicated integration architecture that spanned multiple legacy core systems. CSAA needed to replace and consolidate these systems in order to improve infrastructure and policy service, as well as cut costs while laying the groundwork for growth. The project required over fifty internal and external integrations of the organization’s six PAS and three billing systems. While this was a substantial organizational challenge, the company ultimately credits success to its prioritization of the project and use of top project management. Moving program analysts into sustaining operations roles and establishing support and advisory were also key factors. Ultimately, the replacement initiative reduced time-to-market for new products by 50% and decreased underwriting expense ratio by 1%. CSAA also reported a savings of $26 million as a result of retiring two legacy systems, and its DPW increased from $2.6 billion to $3.2 billion.

For more detail on this project and more than 30 others, including cases from MetLife, AIG, Michigan Millers, and Aflac, see Novarica’s Best Practices Case Study Compendium 2016.

Case Study Highlight: Enterprise Data at Farm Bureau Financial

Jeff Goldberg

As we approach the announcement of the Novarica Impact Awards in the fall, we will be highlighting one Impact Award nominee each week on our blog. The Novarica Impact Awards are voted on by over 300 members of the Novarica Insurance Technology Research Council, making them the only purely peer-reviewed awards program in insurance technology.

Many of the 2016 Impact Awards nominees cited cross-functional teams, with resources familiar with multiple business areas, and the use of Agile methodology as keys to a quick and successful delivery. Many projects focused on consolidation and speed, combining disparate data silos and core systems to enable centralized access and real-time querying.

This week, we look at an enterprise data initiative at Farm Bureau Financial Services.

Farm Bureau Financial Services needed to improve its data integration capabilities as part of a larger life insurance core systems replacement project. To address this issue, the company built a hub-and-spoke architecture to consolidate more than 30 data integration points between disparate systems. The team executed the project through a series of Agile iterations, and the integration layer was ready for deployment in July 2015. The project reduced report run time from over an hour to three minutes, and time to produce complex data reports decreased from two weeks to an hour. Design time was cut from multiple months to two weeks, and consuming systems are now able to retrieve data in near real-time as opposed to batch feeds. Defining long-term strategy and enterprise architecture and articulation of the goal state were crucial to help the team stay focused. The team also attributes success to support from executive management, as well as education and assistance from its vendor partner.

For more detail on this project and more than 30 others, including cases from MetLife, Amerisure, Merchants Mutual, and Trustmark, see Novarica’s Best Practices Case Study Compendium 2016.

Case Study Highlight: Self-Service for Claimants & Partners at Homesite

Martina Conlon

As we approach the announcement of the Novarica Impact Awards in the fall, we will be highlighting one Impact Award nominee each week on our blog. The Novarica Impact Awards are voted on by over 300 members of the Novarica Insurance Technology Research Council, making them the only purely peer-reviewed awards program in insurance technology.

The 2016 Impact Awards nominees consistently cited cross-functional teams, with resources familiar with multiple business areas, and the use of Agile methodology as keys to a quick and successful delivery. Many projects focused on self-service capabilities, multi-channel applications, and data infrastructure to facilitate cross-departmental access.

This week, we look at a Homesite project that enabled self-service for claimants and partners.

Homesite wanted to provide better service to claimants and partners during catastrophe events, with the goal of improving customer experience, operational efficiency, and cat resource capabilities. The project built a strong relationship between IT and business units, which the team credits as a key success factor. Homesite also cites collaboration between the company and its vendors and business partners as crucial. The lessons learned from the project helped team members focus scope and understand industry standard technologies. It also eliminated manual rekeying associated with 33% of incoming FNOL volume and increased scalability during times of high claim volume. The project is ultimately expected to save the company $1 million over the course of eight years.

For more detail on this project and more than 30 others, including cases from AIG, MetLife, Heritage, and Glatfelter, see Novarica’s Best Practices Case Study Compendium 2016.

Case Study Highlight: Infrastructure Optimization at the Hartford

Don Metz

As we approach the announcement of the Novarica Impact Awards in the fall, we will be highlighting one Impact Award nominee each week on our blog. The Novarica Impact Awards are voted on by over 300 members of the Novarica Insurance Technology Research Council, making them the only purely peer-reviewed awards program in insurance technology.

Many of the 2016 Impact Awards nominees cited cross-functional teams, with resources familiar with multiple business areas, and the use of Agile methodology as keys to a quick and successful delivery. Common among many projects was a focus on operational transparency, overcoming internal challenges, improving relationships, and cost savings.

This week, we look at The Hartford’s initiative to optimize application infrastructure.

The Hartford Group Benefits division needed to optimize application infrastructure in order to decrease the total cost of maintaining the environment. The project team faced disparate data sources, an outdated application inventory, and lack of standardization within the application infrastructure. Tracking templates and assigning support helped to overcome these issues, as well as improvements in resource time and commitment to the application environment. The team cites the ability to quickly identify and execute opportunities and the savings to come from future investments in the infrastructure as further success factors. The resulting application infrastructure improved the TCO/lifetime value of the environment and reduced storage and server costs by 8% annually. The migration to a private cloud model saved 2-3%, and decommissioning physical servers saved an additional 2%. Finally, database optimization saved the company 3-4% annually.

For more detail on this project and more than 30 others, including cases from MetLife, Tokio Marine HCC, Prudential, and Unum, see Novarica’s Best Practices Case Study Compendium 2016.

Case Study Highlight: Enabling One-Day Health Claims Payments at Aflac

Matthew Josefowicz

As we approach the announcement of the Novarica Impact Awards in the fall, we will be highlighting one Impact Award nominee each week on our blog. The Novarica Impact Awards are voted on by over 300 members of the Novarica Insurance Technology Research Council, making them the only purely peer-reviewed awards program in insurance technology.

Many of this year’s impact award nominees share some common characteristics – the use of Agile methodology, a focus on communication, strong executive support, and planning for substantial user training as a key part of unlocking value creation.

This week, we look at an Aflac project to enable one-day health claims payments.

The One Day PaySM initiative was a response to a direct challenge from Aflac’s CEO to create a unique claims payment process. Aflac’s goal was to reduce average claims processing time from four days to one. Over the course of the 12 month project, Aflac used Agile methodology to ensure delivery and quality, which they credited with enabling their speedy delivery and enhancing collaboration between IT and business teams, especially when supported by co-location of IT and other business units. The lessons learned have since been applied to a full restructuring of the IT organization. The project has resulted in 87% of online claims meeting One Day Pay requirements—a year-over-year increase of 43%. Customers submitting claims online reported a satisfaction rate of 91%. The direct deposit capability also reduced the company’s carbon footprint, saving an estimated 16,000lb of paper.

For more detail on this project and more than 30 others, including cases from MetLife, Prudential, The Hartford, and Trustmark, see Novarica’s Best Practices Case Study Compendium 2016.

Common Characteristics of Successful IT Initiatives

Matthew Josefowicz

Our fifth annual Novarica Impact Awards are underway, which recognize impactful IT initiatives executed by insurer CIOs and their teams. More than 30 initiatives qualified for this year’s Impact Awards across data, digital, core systems, and IT best practices. Case study subjects include AIG, CSAA, Everest, Great American, GuideOne, Homesite, Merchants, NORCAL, AFLAC, MetLife, Prudential, The Hartford, Trustmark, Unum, and more. Among the qualifying initiatives, some commonalities emerge that reflect the changing state of IT in the insurance industry.

Executive Support

A consistent factor in successful projects was support from executive leaders. Strong executive support ensured the coordination and communication necessary to execute complex cross-departmental projects. The vision of executive leaders was also important in clearly defining project goals and benefits for all departments within a particular carrier.

Training

A key component of many projects was ensuring that employees received necessary training. In some cases, this was practical: users needed to know how to use a new feature effectively. However, many projects needed to overcome resistance from prevailing corporate culture and reluctance to embrace change.

Effective Communication

In order to overcome internal resistance and ensure cross-departmental coordination, clear communication was essential to many projects. In many cases, demonstrating the benefits of new technology was a key factor in overcoming resistance to change. Many projects also required interfacing between multiple internal carrier departments as well as frequent coordination with external units.

Agile Development

Insurers whose projects used Agile development methodologies realized gains in time to delivery, project costs, transparency, and improved communication between IT and business units. Agile helped many teams manage large projects while staying flexible. In particular, Agile helped kept multi-part projects on schedule, as distinct project components could be completed in parallel. Agile also helped project teams adapt on the fly to changing requirements during the development process.

Voting is currently open to members of the Novarica Insurance Technology Research Council, and winners will be announced in the fall. To learn more about the Research Council, check out http://novarica.com/council.

Related reports:

  • The Impact of Impact Awards

    Frank Petersmark

    My colleagues and I recently had the opportunity to present some of the 2015 Novarica Impact Awards to worthy winners. The goal of the Impact Award is a straightforward but powerful one: recognize those insurance technologists (and their business colleagues) who have made a qualitative and quantitative impact at their company.

    For 2015, just a handful of winners were selected from nearly forty submissions. The winners ran the gamut across the insurance spectrum in terms of size, geography, and business spread. However, they all shared a few things in common:

    • Clear articulation of expected business value
    • Consistent executive sponsorship
    • Consistent and frequent communication during the project, with an emphasis on newer software development methodologies like AGILE
    • Close coordination with vendors
    • Clear use of success metrics

    The common denominator between all these elements was something that has proven difficult for IT groups historically: being collaborative and communicative partners with the business and with any other key stakeholders. Each of the 2015 winners did this exceedingly well, and in the process built an effective and sustainable model for future business technology efforts. That’s important stuff.

    When I had the pleasure or presenting two of these awards recently, both of the award winners I visited spoke more about the impact and value their efforts brought to their respective companies than they did about any particular technologies or solutions.

    FG
    Me presenting an Impact Award to Fidelity and Guarantee Life for launching their e-app

    HCC
    Me presenting an Impact Award to HCC for launching their new product line and portal

    My colleague Chuck Ruzicka recently visited Ameritas to present an award for the company’s use of a project execution framework. There, the drive for business models was also apparent. As CIO Richard Widenbeck said, “Ameritas understands the value of executing projects and making well informed decisions. By creating and maturing this process foundation, we believe we can drive value-based outcomes, align risk and investment levels, and improve execution excellence in a way that creates sustainable advantage. We are thrilled to receive this award.”

    Chuck
    Chuck Ruzicka presenting an Impact Award at Ameritas

    My colleague Robert McIsaac also had a chance to present an award at Tokio Marine North America for their deployment of analytics to improve agent performance management.

    TMAS
    The Tokio Marine Impact Award Presentation

    In all the award-winning organizations that we have visited so far, the emphasis on creating an effective model for all business technology efforts has been clearly evident. This should be the focus of all carriers in 2016. If there’s a project at your company that deserves recognition, there’s still time to submit information for a 2016 Impact Award.

    Novarica Impact Awards Summit Recap

    Matthew Josefowicz

    Our recent Novarica Impact Awards Summit provided a forum for IT leaders to present and discuss their nominated case studies with a broad group of Novarica council members and clients.

    The projects presented ranged from Philadelphia Insurance’s adoption of a legal bill review solution that delivered a multimillion dollar payback to MetLife’s successful transformation of their global trading systems. Panel discussions highlighted the importance of IT’s ability to communicate effectively with other business units in delivering impactful projects, and many cited the adoption of agile as a success factor in their projects. While most of the projects involved working with technology vendors, some focused on the adoption of new practices and frameworks, and others on custom development in both traditional platforms and in the cloud.

    Speakers-Comp

    The panels also presented an opportunity for IT leaders to compare notes on project priorities and strategies, with many attendees noting that their organizations had faced similar challenges and worked toward similar goals. Several presenters and audience members described the importance of securing other executives and end users to act as champions throughout the organization, to speed adoption of new technology and processes.

    One theme that rose to prominence this year was a focus on user experience—not just for customers, but for agents and carrier employees as well. AFBA/5Star Life incorporated the needs and requirements of more than 40 third-party administrator customers when designing a new List-Bill solution. CNA deployed an enhanced agent self-service portal for quoting and issuing endorsements, drastically improving agent experience and satisfaction. And Tokio Marine North America introduced a new analytics system to aggregate customer and agency data, empowering business users with insights into previously-unknown market segments.

    Taken together, these and many other nominees represent a trend towards end-user focus. Insurer CIOs are recognizing that usability of a system by all its stakeholders must be a priority, whether a project involves cutting-edge analytics or core systems replacement. These projects have successfully balanced user needs with business and system requirements—essential for ensuring a project’s positive impact throughout the organization.

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    All of the nominated case studies are featured in Novarica’s Best Practices Case Study Compendium 2015, which is free to Novarica clients and council members.

    Insurance Networking News was there to cover the keynote and conduct a short video interview on themes of recent impactful projects.

    Project teams from nominated companies received their awards, and had an opportunity to network with each other an the other attendees.

    Nominee-Comp

    Networking Comp

    To learn more about the Impact Awards program, see http://novarica.com/impact2015/