The Reformation of Insurance & Technology Credibility

If you work in insurance technology and are truly valued as a trusted partner, this article isn’t for you.

If your counsel is enthusiastically sought by someone with a mandate to make or save your company money, this article isn’t for you.

If you go to work each day focused on how you can partner with the people responsible for making your company money by increasing premiums or reducing losses, all while relentlessly driving down expenses, this isn’t for you.

This isn’t for you because you are doing what you are supposed to be doing. You get it. It must be lonely. Soldier on. You are on the side of the insurance angels.

For the rest of you, I am on a mission of mercy. Somewhere along the way your organization has been led astray. Was it someone in an expensive suit from a fancy consultancy who pointed you down the wrong path? Did your people attend one too many boondoggle conferences and internalize one too many ridiculous catchphrases? Did your predecessor read one too many articles about disruption, or research one too many buzzy solutions desperately searching for a problem?

It doesn’t matter.

Insurance technology has lost sight of how to help insurers. It’s lost the credibility of the people who make your company money, and theirs is the only opinion that matters. Need proof? What’s the average lifespan of an insurance CIO nowadays?

Now is the time to be bold!

Now is the time to become indispensable!

5 Steps

You are five steps away from grace. Step 1 starts today. You’re going to schedule a meeting and from the minute you hit send you will be committed. You will immediately be better for it. Step 4 ends 6 months from today. That’s too far in the future for anybody to care but don’t worry, you will deliver value almost immediately. 6 months from now is not when technology’s reputation will begin to change, it is when it will have been absolutely and incontrovertibly changed.

Step 1: Ask for forgiveness

Nobody will accept your earnest desire to better your organization without an act of contrition. You owe it to to the company that shelters you. You owe it to yourself.

What are you apologizing for?

You are not apologizing for specific failures. You are not talking yourself out a job. That you were six months late and a million dollars over budget rolling out a new enterprise publishing platform, or that production problems meant the business was two days late closing the books are failures, true, but they are symptoms. Don’t apologize for symptoms, we’re beyond that. You need to apologize for the disease.

What are you presiding over, culturally, that is keeping your technology operation from being an unquestionable success? You aren’t apologizing just for your own actions, you are apologizing for the DNA of an entire organization. For a mindset.

You are apologizing because every single person acting in every single technological role of your organization has not been laser-focused on adding business value. The goal of your apology is to make it obvious to your stakeholders that you understand that.

Apologize that your subject matter experts go to 10 hours of meetings a day and can’t draw a straight line from any one of them towards additional premium, lower losses, or reduced expenses. Apologize that your leadership has prioritized architectural and technical purity over business speed-to-market. Apologize for your infrastructure organization being a technical impediment to business change. Apologize that people in your organization have said “no” to people who wanted to make the company money.

This apology is not for you. It’s not about catharsis or redemption.

This apology is to convince the people that matter that you understand there is a problem and that you’re willing to accept accountability.

To whom are you apologizing?

There’s actually a bigger question here: Who’s approval should you care about?

The answer is simple: All the people who have responsibility for making the company money or saving the company money.

You work in technology for an insurance company, not a software company. You are a cost center. All you can do is cost the company money. There is nothing you, nor anybody that works for you can do that will change the fact that the company needs to pay you. You are not going to become billable to some other organization, you are not building something that some other organization will buy in exchange for cash. You are an expense.

Yet insurance technology has vital, intrinsic value. You have a super power. You can create. No other corner of your company can create things as tangible, as observable, as technology. That’s why you exist.

Profit centers need technology because they need people to help create the things that allow them to generate profit. Better ways to work with agents so they submit more business, new sophisticated rating models leveraging innovative datasets that allow them to price previously unwritable risks, platforms that would allow them write new insurance products. They need these things.

List the most senior people in whatever profit centers you interact. If you’re very senior, these should be the people who own the P&L. If not, find the product owners, the underwriting managers, the actuaries.

Unlike profit centers, most cost centers look more like your organization. You, however, offer them a way to lessen their expense to the profit centers. They need you to build new systems to automate manual tasks, to reduce keystrokes in existing systems, to add automated underwriting models, to eliminate dual data entry into multiple systems.

Find the most senior person or persons you work with at each cost center. Add them to your list.

Now you have what you need to complete step one. Pick one or two people off of that list. Choose the ones who are your largest detractors. Choose the ones closest to your CEOs heart. Choose the ones with the worst processes or the highest potential. Just choose. And then apologize for the ways technology has failed them.

From this point forward there is no more looking backwards. No more room for regrets or

shame. From here we launch directly into the future.

Step 2: Paint the path towards redemption

What does redemption look like? The future is a technology organization that is laser focused on adding value to the business groups that pay for it. That value will exponentially outweigh the costs.

These stakeholders don’t want to hear about HOW you’ll be redeemed. Software methodologies, hirings, firings, partnerships, software: those all sound like you asking for more money.

Stakeholders want to be told what that redemption will look like to them. You need to present a concrete path towards the future. That path has three parts:

  • Canvas your profit and cost center customers for a list of things that could be done that would immediately provide business value
  • Choose three projects:
    • Something that would have taken you three months that you’ll do in one
    • Something that would have taken you six months that you’ll do in three
    • Something that would have taken you twelve months that you’ll do in six
  • Execute
    • Release 1 in 30 days
    • Release 2 in 90 days
    • Release 3 in 180 days

All that really matters here is the last three bullet points. You are COMMITTING. You are all-in on this statement. You will deliver three things and you will do it within this timeframe.

If you balk at the thought of this commitment, if you feel like it’s too much skin in the game, it’s not. You committed to adding business value as soon as you accepted the job offer.

All you’re doing is honoring that commitment.

You don’t need to relish the challenge, but you have to accept that it is in your mandate to succeed in it.

Step 3: Ask for help

 If you were to get through steps 1 – 2, and then go off and execute perfectly, without asking for help, this entire process will end in failure.

The point in asking for help isn’t to make your life easier. It’s to begin cultivating allies. You need to have other people from other organizations who have a vested interest in your success.

You are going to ask for help in:

  • Determining the list of opportunities for technology to add business value
  • Making available the right people to make you understand the nuances of each item on that list

Again, as a technology organization you have the unique and miraculous ability to create. As a technology leader, however, you have an interesting sales job. You need to make your business customers think that THEY had the power of creation, and your technology organization was just the tool by which their will was made manifest.

Asking for help is your way of selling that belief.

When you do ask, ask nicely. Their time is busy, they have things to do, things that are probably closer to the company making money than anything you’re doing on a day to day basis. You need to beg for a small allotment of that time and squeeze every bit of value from every minute you get.

I suggest laying out a five-pronged strategy:

  • One 30 minute meeting with whomever you’ve apologized. They’re your chief stakeholders. This is just to identify a list of things that could help, and the name of someone you could get a follow-up meeting with.
  • A meeting on each of the items that came from the step above with the right person. Take no more than 15 minutes per item, but leave open-ended time for new items that come from this person. These new items can often lead to the best options. Whoever is speaking with you should be someone you cultivate a good relationship. Do this over lunch, or even better, dinner. You’re buying.
  • When all these meetings are done, take 60 minutes to go through the entire list. Give each item a grade in terms of how impactful YOU think that this will be to the organization.
  • Have a meeting with one or two subject matter experts from your technical team to determine what it might take to deliver the high value items. Focus on hours of effort, not constraints. Push estimates that are two conservative downwards. Everyone should agree, but they should feel challenged. Leave this meeting with a firm decision on your 30 day item, your 90 day item, and your 180 day item.
  • Reach out to the business-person who gave you each of the three items you’ll deliver, and tell them how excited your team is to start working on them. Set expectations that you’ll want time for them to share their vision on the work item to best guarantee value is delivered.

This step is about you coming to the table. You have committed to doing things differently. You have aligned your focus towards that of your customers. When they accept the job of helping deliver a work-item, they are implicitly buying into you and your new direction. They instantly become an ally and, later, will become a promoter.

Step 4: Execute

There is so much out there about the best ways to run technology projects. Books and certifications and blog posts and hundreds of organizations all subscribing to different credos and holding dear to different differentiators. I’m not here to talk about that. I don’t believe that it makes much of a difference, in the end.

Go waterfall, go lean, go scaled agile, use no methodology, use a dozen. None of that really matters, but it’s a sure way to step off the path towards success. Too much effort, money, and mind-space has been dedicated to coming up with processes, and I think it’s an different discussion from one of execution success.

Let’s pause and look at what we have available to us having come through the first three steps:

1). You have an audience. Asking for forgiveness ensured that someone important has their eye on you. Pressure is a tool. It will sharpen you, and you should pass that down, so it sharpens your team as well.

2). You have momentum. You dropped a pebble from a mountain top, and now it is an avalanche. Use that momentum to aggressively move forward, bowling over obstacles. 3). You know what you need to do to build business value and, as importantly, the recipient of that value is an ally, fighting next to you.

So go build something. Your passion, attention, and willingness to ask forgiveness rather than permission will make your projects successful. Your organization is full of people who know how to create things and just want to get things done. Recruit them. Motivate them. Challenge them. Ask them for audacious things. Provide cover from fire and ensure that all failures fall forward. Accept nothing short of success.

  Scope is the most important weapon in your arsenal. Cleave unerringly towards time, and let scope fall where necessary. Temper the scope of each work item from a club to a fine edged sword pointed unerringly at business value. Trim away all excess.

Be the leader you were excited to be the first time you were given command of something. Grind impediments to dust beneath your feet. Come armed with your greatest threat, “You’re keeping my business customer from making this company money”.

Everyone who isn’t aiding you is ultimately stealing money. Do not let long range, hypothetical concerns encumber your execution. Architectural integrity, SDLC management, procurement, these safeguards are often so bloated that they cost more than they ever save. Listen to them, consult with their proponents, incorporate what makes sense. Don’t let them stop you.

Resources

Where do you find the right people to work on these projects? A preferred strategy is to find people who will be as rewarded by gained credibility as you are. That credibility has a value, trade it against their costs in terms of time and dedication.

Or better yet, find an external partner willing to work for aggressive rates to prove their value. Someone with expertise in not just P&C insurance, but in being successful in P&C insurance technology organizations. A partner that is willing to align themselves to your goals, and put their own skin in the game to prove it is a partner that will make you successful now and in the future.

Step 5: Make hay while the sun shines

When you’re almost ready to deliver your 180 day work-time to user acceptance testing or production, begin the ‘Operationalization Road Show’. You’ve been successful doing things a different way, you need to have a series of discussions on how you can take these lessons learned and weave them into the DNA of the broader organization.

These sessions serve a hidden, and more important purpose though. This is your victory lap. You’ve proven that you can be successful in this small way, within your defined sphere of influence. Ensure that everyone feels like they can share in this success. Ensure your stake-holders are getting the lion’s share of praise.

Now you have credibility, you don’t need praise.

Do it over and over again. Spend a little of the credibility you’ve earned to ensure you have resources and timelines that make sense for the next projects. Always hold two things close though; business value above all else, and single-mindedness on execution.

Conclusion

Insurance technology used to make things better. The people running systems were closely aligned to the people behind underwriting desks, or writing claims checks, or working on the ledger. Work got done.

Somewhere along the way, insurance technology stopped helping. A revolving door of executives, each listening to their own angels and devils, each uniquely unable to drive their business forward. Slick software vendors selling monolithic core platforms promising to solve all problems, if only you’ll sign up for the requisite heart-surgery. Well armed consultants who want to soak up months of time at ridiculous rates to deliver PowerPoints that are quickly filed and forgotten.

It is time to stop this. Be the change your business so desperately desires. Listen to only one voice, the voice urging you to add business value. Rebuild yourself to execute. Rebrand yourself as someone that is making a positive impact on the bottom line.

About Luke Magnan

Luke Magnan is the Chief Operating Officer (COO) for Combined Ratio, an insurance technology services provider specializing in maximizing the value commercial lines property and casualty (P&C) insurance companies have invested in existing IT infrastructure. As Combined Ratio’s COO, Magnan drives operational strategy and success. He has executive oversight for Combined Ratio’s services and product divisions. With nearly 20 years of industry experience, Magnan is an expert on property and casualty (P&C) insurance technology having worked in both insurance company and vendor organizations performing various strategy, sales, and implementation leadership roles. He has significant experience optimizing core systems and completing replacement or modernization initiatives. He has a proven track record working with insurance executives to help understand business drivers, pain points in system portfolios, suggest opportunities for modernization, and identify where unique solutions provide can provide business benefit while reducing cost. He began his career as a programmer with The Hartford and moved up quickly to leading teams of developers and maintaining responsibility for many core platforms before becoming senior program architect. He spent time as a solution architect for both Insurity and AgencyPort before joining Xuber as lead solution architect in the U.S., and then becoming AVP of sales engineering and solution architecture in North America. Magnan graduated from the York College of Pennsylvania with a B.S. in Information Technology, before going on to receive an M.B.A. from the University of Connecticut School of Business.

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