- Distribution: French CIOs understand that the distribution landscape is changing fast. They have all listed distribution as one of their priorities for 2010 and most of them intend to launch IT initiatives to take advantage of the growing importance of online insurance notably.
- Regulation: the Solvency II regulation framework affects directly insurers IT investment priorities. As the results of the quantitative impact study 4 launched by the CEIOPS in 2008 tend to demonstrate, there is a growing interest by French insurers in understanding what are the impacts of the new set of prudential regulation not only on their solvency ratios but also on their ability to comply with the other elements of the regulation. Some insurers have already invested in new IT systems for instance capital modeling tools but some others still need to understand what they have to start with and what they need to focus on to be ready in 2012.
- Improvement of core processes and cost reduction. Even though most of the CIOs interviewed so far clearly mentioned they had not really implemented drastic measures (layoff program, IT investments cancellation, etc.) following the financial crisis and the economic downturn, improvement of core processes leading to cost reduction via a smarter use of IT resources represents a priority for 2010.
Archives for December 2009
The commercial craziness that is the run up to Christmas has kicked off here in Britain with the checkout tills are humming from Oxford street to Covent Garden in London. But if you listen carefully, you should also be able to hear the whirrings of transactions in the darkness of cyberspace. The English have embraced on-line shopping, and there are estimates that we will buy 15% of our Christmas goodies on-line this year.
I’m a great example of someone who uses the Internet for work and play. As if being wedded to the laptop for more hours of the day than necessary isn’t enough, I choose to shop on-line as well. And for the most part, I love it. As an industrious cyber-shopper and pedant, I pride myself in spotting website shortcomings.
What surprises me is just how many sites with shortcomings I’ve stumbled across in this last week. Have Santa’s little helpers gone on strike ahead of the rush to Christmas or is this poor planning on part of IT and operations? Here’s a few examples:-
- A hotel booking website which couldn’t successfully take a booking via credit card – no surprise, I choose another hotel.
- Two retail sites that send tracker notification emails without the tracker ids – annoyance factor that grates at their brand.
- A mobile phone site requiring me to re-key all details when I move to another section – more brand erosion.
- A retail site who’s “shopping basket” had a memory limit of 5 minutes.
Some of these shortcomings contribute to the annoyance factor. It’s like going into a brick-and-mortar store, and they don’t have the item on the shelf. You can’t sell what you don’t have in store. So you take your pounds elsewhere, and the company never knows they even lost your business.
Business should be smarter about their on-line stores. You don’t leave your high-street store unattended, or without stock? You should pay similar attention to detail in your on-line offering. The direct channel will become an increasingly important in the future, for retailers, and insurers alike. Relative to retail, insurers have been a little slow at embracing on-line commerce, but should remember that they get measured along the same factors as an on-line retail store. After all, that’s what the consumer knows.
The English are happy to buy insurance on-line, particularly motor. We have some of the better websites in Europe for doing exactly that. And there is plenty of activity. Through an aggregator site, one insurer gets 250,000 quotes between 8pm and 9pm on Monday’s – apparently, this is the time consumers look to shop for insurance. You couldn’t make it up!
The key take-away here is the importance of having a solid customer portal that behaves in the manner a customer expects. This requires continued investment to reflect changing customer behaviour, and to leverage new technologies. In conversations, we see this as one of the key areas for IT investment in 2010. (We will be writing more on the topic of B2C in insurance in January). Owning the distribution space remains an important objective for insurers looking for growth in the coming year.
The holiday TV classic, Rudolph the Red Nosed Reindeer, was on last night. I watched the whole show with some delight, as it brought me back to a more innocent time. The 60s sensibility of the production is funny now, and a bit jarring. When Rudolph’s dad told Rudolph’s mom that she can’t go looking for Rudolph “because this is man’s work!” I laughed out loud. I don’t think that line would make it past the editors today.
But there are more enduring themes in this production that are as true today as the day they were written. One of my favorites is the Island of Misfit Toys. For those of you who need a reminder, the Island is a gathering spot for mismatched toys that no one wants. For example, there is a train with square wheels. There is a dolly that cries. There is a bird that swims in a fishbowl. And there is a Jack-in-the-Box named… Charlie.
Over my career as a consultant, in conversations I’ve often imitated Charlie’s plaintive line, in his cracking voice: “Nobody wants a Charlie-in-the-Box!” It’s a catch-all phrase that reminds me that some things are just…not…quite…right.
In our day to day work, we all recognize these things readily. Systems that don’t do what we want them to. Processes that are head scratchers. People that don’t seem to fit in the roles that they’ve been given. But once you learn to live with a Charlie-in-the-Box, you can almost forget the obvious. You begin to have some misplaced affection for those hapless systems, processes, and people. They’re not very good, but they’re yours. And that’s why they persist.In Rudolph’s day, it was important to have a happy ending. So the show ends with Santa going to the Island, picking up the Misfit Toys, and finding children who are happy to give those sad toys homes. Awwwwww! But in the real world, our job is to recognize when our affection for systems, processes, and people is misplaced. Our options include repairing or replacing our misfit toys, and that is the only happy ending we should entertain.