Over the next two weeks, INN will present the 13 case studies of Novarica’s Research Council Impact Award nominees in no particular order. The awards, which will be presented at the research and advisory firm’s October 30th event in New York, honor best practices in insurance industry IT initiatives and strategy.
Erie Insurance, nominated for a Practice award, wanted to overhaul its reporting of IT costs and move to a "Total Cost of Ownership" view. So, it started what would end up being a 14-month transformation project leveraging a project and portfolio management (PPM) application to track all costs across 13 discreet portfolios, including summary and line item detail for all IT Grow the Business and Run the Business costs fully reconciled to Erie’s general ledger system.
Through an iterative development methodology, the project was implemented in a two-pass approach—phase I to address the budgeting process and phase II to address portfolio and financial management deliverables. The project team included 25 IT employees, although all IT management and project management was involved, and two staff-augmented resources.
The company focused on driving expense transparency and accountability to projects and applications not only with technology but across the business groups as well, which was the first step toward moving the organization toward a Total Cost of Ownership view. Therefore, business users were engaged throughout the implementation of the concept utilizing designated representatives from each portfolio to provide feedback as well as extensive workshops and monthly meetings.
The initiative was led by a project manager within the IT Project Management Office, and overall direction and governance was obtained from a broader Steering Committee made up of executive management from IT and finance, a group Erie says was critical to the acceptance of the project.
The business partner’s involvement enabled the team to re-prioritize efforts quickly to provide functionality/value on a regular basis rather than waiting until project completion. The team also turned to focus groups comprised of technology and business team members throughout the project.
While so many areas were included, change management among the end-users was one of the largest hurdles Erie faced. It offered multiple workshops, Lunch & Learns and presentations, and increased communications to address the concepts and bring end users on board. Also, multiple senior/executive management sessions were needed to assure information was meaningful and supported Erie’s business needs.
The project ultimately expanded the pool of users of investment level data/information from 10 users to 60. The ability to provide transparency regarding spend to investment owners increased by 90 percent, the ability to track labor at each investment level increased 70 percent and the ability to allocate and understand direct non-labor expenses to investments increased 100 percent.
Portfolio/application owners gained visibility into their respective budgets, forecasts and actuals, which has improved governance and interaction between the business and IT. Finance and IT PMO also have a repeatable process for generating monthly reports on IT’s performance to the annual budget.
Overall, Erie now has more complete tracking of IT initiatives and greater visibility into strategic alignment and the impact of long-term IT support costs resulting from its key initiatives.
To see coverage of the other Novarica's Impact Award nominees, click here.
Check back Monday to find out how Great American delivers self-service functionality through its customer mobile apps.
About the awards: Novarica’s first annual Research Council Impact Awards honor best practices in insurance industry IT initiatives and strategy. Nominees were selected across four categories—Practice, Quick Hit, Transformation and Expansion—with three nominees chosen for each (a tie in the Expansion category meant four nominees were selected). The nominees were selected by a committee from a collection of case studies drafted by Novarica from submissions by insurers.
The nominating committee included CIOs Andy Wood (Wilton Re), Dan Simpson (Trustmark), Eric Bulis (SBLI USA), Larry Fortin (Millers Mutual Group), Mark Berthiaume (Chubb), Pete Moreau (Amica), Piyush Singh (Great American Insurance Company), Reuben Broadfoot (LifeMap), Sal Abano (Tower Insurance), Stuart Tainsky (PURE) and Tim Billow (ING).
Winners will be determined by votes from the more-than-300 members of the Novarica Research Council, a moderated knowledge-sharing community of insurer CIOs and senior IT executives.
The nominees and winners will be recognized at the Novarica Research Council Impact Awards Event in New York City now on November 14th.
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