In today's competitive financial services marketplace, insurance companies are depending on their IT departments to quickly implement new technologies that support strategic business objectives. To keep pace with the massive information technology requirements, insurance CIOs are spending an increasing amount of time-and money-on recruiting, training and retaining smart and savvy IT technicians.Most insurers continue to rely on their IT departments to develop and implement new applications. But the complexity of new technology, coupled with an overall market shortage of qualified IT technicians, is forcing carriers to look more closely at assessing the IT talent they already have.
Recruiting wars
Recruiting talented IT workers is an option, but insurance companies face a tough battle.
The Information Technology Association of America reports that IT managers will attempt to fill 1.6 million technology positions this year. However, the association estimates that 843,000 positions will remain unfilled due to the shortage of qualified IT workers.
"Across every industry, the IT environment is suffering from a lack of talented, skilled workers, and many positions will remain open," says Celicia Claudio, senior vice president and CIO, for Los Angeles-based Farmers Group Inc.
The nationwide shortage should make organized, effective recruitment a top priority at any size company, says John Madigan, IT human resource vice president at the Hartford Financial Services Group, Inc., Hartford, Conn. A major recruitment thrust for the Hartford Group and other carriers eager to fill entry-level IT positions are local and regional universities and technical schools.
But conventional recruiting sources for new IT talent such as contingency recruiters, professional societies and organizations aren't fulfilling insurance companies' staffing demands, forcing carriers to try new approaches.
"Posting IT openings on our Web site is a very successful new channel for us," says Barbara Koster, CIO of Prudential Insurance in Roseland, N. J. "We must use a variety of different sources to recruit the best employees because there is no single large pool of talent at any one source these days."
New skills sets
Compounding the problem of filling IT vacancies is that today's technicians need a different skill mix than was necessary in the past, says Mark Cragan, vice president of consulting for insurance and financial services at IBM Corp., Armonk, N.Y.
"We've talked about the alignment between business strategy and IT for years, and now they have literally become one and the same with e-commerce," says Cragan. "IT staff today must be bi-lingual-they must speak both technology and business."
Insurance companies for the most part have enlarged their IT departments and moved beyond mainframe and legacy systems to incorporate client-server systems, the Internet and other object-oriented development and applications. Although IT executives say there will always be a need for back-office, internal automation and maintenance staff, the growing importance of e-commerce requires additional technical staffers with more specialized skills.
Proficiency in Web-based applications and Internet development languages such as Java, HTML and Extensible Markup Language, as well as Oracle-based database administration and client-server technology, are important skill sets needed in the insurance industry, insurance CIOs say.
"We're confident that our employees have the right skill sets for what I call the old economy, which is made up of such day-to-day systems as policy management and billing," Claudio says. "For the new e-business economy, we're just breaking ground like a lot of insurers are just now doing, so we're actively recruiting new people, and retraining and reskilling people within the organization."
Business skills that insurance IT executives say they require from their staff technicians include project management, business and financial knowledge, and interpersonal communication. IT staffers that have sophisticated business and communication skills, coupled with specialized high-tech knowledge, have the best mix of skills and talents for today's insurance information technology environment, says Kelly Cannon, CIO for Wausau Insurance Co., Wausau, Wis.
"IT project leaders must interact as equals with senior management," he explains. "They must understand business issues and strategies and be able to articulate creative solutions to business problems."
IT professionals also list critical thinking skills, innovation, high-motivation, team-player attitude, high energy level, and multitask orientation as preferred qualities for their staffs.
"There has been a dramatic shift in this area as well," says Hartford's Madigan. "Now `soft' skills are just as important as business savvy and technical expertise."
Training aids retention
Keeping the best and brightest technicians is a top priority for senior IT executives. One of the best tools to recruit and retain top IT employees, insurance CIOs and human resource professionals say, is an effective training program.
Many insurance companies offer new hires extensive training programs that teach them basic insurance business practices and advanced technology. Human resource professionals say an initial training program, coupled with an on-going training commitment, can be an effective means of luring young, inexperienced recruits.
This group of employees needs career challenges and assurances they will learn all the newest computer technologies as their careers evolve, says Beran Peters, CEO of Instruction Set Inc., a trainingcourse development company in Natick, Mass.
"Training can be a huge carrot for hiring. If recruits can learn a whole new skill set as soon as they start work at a particular company, they'll choose that company over another that may be offering a higher salary," Peters says.
An investment in long-term training also helps retain existing staff. By retraining staff in newer computer technology, companies can save time and money by keeping valued employees. Although it can be argued that teaching staff new skills may make them more marketable to other companies, most CIOs and human resource professionals say it does more to build morale and loyalty.
"Money spent on training lets employees see how the company invests in their professional career growth and development," says Ryan Conlon, IT manager for Progressive Insurance in Mayfield Village, Ohio. "Give them the opportunity to learn and they will stay with your company."
Fostering staff morale
Staff training can be offered in many forms depending on variables such as company size, budget, skills being taught and IT staff size itself.
For example, smaller insurance companies may only allow their employees to take night and weekend courses rather than those taught during critical work hours when a staff shortage could result.
Larger organizations can provide a variety of technology training options that include in-house or off-site courses, seminars and workshops, videos, and computer-based and Web-based programs.
Advantages of Web-based training include fewer hours that employees are off their jobs due to travel and a reduction in expenses for travel to off-site locations, says Ben Salzman, president and CEO of Heritage Mutual Insurance Co., Sheboygan, Wis. "Employees can learn when and where it is most convenient to them, and they can review the material until they are proficient," he says.
Some insurance IT executives say most technical subjects can be taught through computer-based or Web-based training courses, while more highly-advanced technical material, as well as business and `soft' people skills, may be best learned in an instructor-led classroom setting.
Retention strategies
As insurance companies continue to automate and adopt e-commerce strategies, the battle to hire and keep highly skilled IT workers will get only tougher.
CIOs and human resource specialists say they use the following effective strategies to help retain qualified employees in today's tight employment market:
On-going training and personal career development.
Competitive compensation-regular market salary surveys to be sure pay scale is fair for both new hires and current staff.
Frequent promotions.
Challenging, fun assignments-these are particularly important for new hires and existing staff who may have only back-office automation or mainframe maintenance work.
Flexible hours and telecommuting.
Bonus and rewards programs.
Excellent benefits and stock-option plans
Lifestyle advantages.
Lifestyle choices become particularly important outside of large cities in order to attract new hires who may want to move to a lower-cost, rural environment, says Wausau's CIO Cannon.
"You have a special challenge when your company is located in a small town," he explains. "You must promote advantages such as fun outdoor activities, great schools, and a low crime rate to lure talent away from urban areas."
It's also important to make sure that the best and brightest IT staffers understand how their work helps achieve the insurance company's business goals. IT employees must be told how they fit into the "big picture" to be most successful and happy at an organization, says Progressive's Conlon.
"IT staff must completely understand the company's business goals and the important role they have in helping to achieve those goals," he adds. "Show IT employees their purpose in an organization's strategic plan and they will have more job satisfaction."
Tina D. Tapas is a freelance writer based in Prospect Heights, Ill.
