Insurance IT shops are about to be tested. Why? Because in addition to something they do very well for themselves and their internal business customerscutting coststheyll be tackling something foreign to many of them: driving business innovation.
Earlier this year, Forrester asked 67 North American insurance IT decision-makers about their big business and IT initiatives for the coming 12 months. Along with the golden oldies playlist of IT efficiency and different flavors of risk management, large insurance IT shops are putting equal muscle to bringing new thinking to the business (see Figure 4-2).
But just what are we talking about when we think of what innovation means? Ask the IT team and youll get responses along the lines of its a new idea or well build some new product or that innovation is new delivery models like Cloud or SaaS. All these responses are right, but successful innovation is a lot more than just making new stuff or buying new tech. To make innovation initiatives pay off means that these kinds of investments need to deliver new business value.
Translated, that means is this innovation something our customersemployees, agents, groups, and policyholderswill value and even pay for? And figuring this out means that the business needs to be willing to fund some investigation into whether the big ideas will be meaningful and how to prioritize all of this new thinking. Without an innovation plan, insurance CIOS and IT teams could get a black eye, spending scarce budgets on initiatives that do worse than go nowhere, but end up disappointing the broad customer base. Even organizations recognized for business innovations like Apple can fall downwho can forget Apples first entry in the PDA market, the Newton?
Before embarking down the innovation path, IT needs to be thinking about the business strategy and whether or not some piece of tech or a vendor solution will deliver that business value. Frameworks like the Innovation Radar can help insurance IT organizations better map this uncharted territory.
This article can also be found at InsuranceNetworking.com.
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