Making the decision to build or buy computer software applications is just the beginning. Once a decision has been made, insurance technology professionals have to proceed with caution.Rick Williams, president of Wilsure Insurance Services, an insurance agency based in Barrington, Ill, says insurers need to be wary of the following pitfalls.
WHEN BUILDING.
* Do not proceed without the proper resources. "You have to make sure you have the resources required to build a system before you start a project. Whether you are using offshore resources or not, it's important to have the human resources available and the ability to manage the project from start to finish.
* Don't save testing for the last step. Often companies will build software applications and won't test the applications until the end of the development cycle. "So, the company winds up developing for 18 months and then the whole thing falls apart when they decide to test the application," he says.
WHEN BUYING.
* Be wary of making modifications to software packages. "Sometimes, companies will start to modify packages before they even know if the base package works properly. Remember, if you modify a package yourself, you have incurred all of the risks associated with developing it internally. If you are adding functionality, you should at least make sure they are modular so that you are not affecting the core of the system," he says. "You want to go for modular functionality outside of the package instead of actually trying to modify the package itself."
* Don't get stuck with vaporware. Insurance companies need to be wary of vendors that are selling systems not yet ready to be implemented. While this was a bigger problem a few years ago, technology buyers still should verify that the complete system is ready to be implemented before signing on the dotted line.
* Check out the vendor's users' group. It's best to make sure the users' group includes companies similar to your own. If the group is composed of people from different types of businesses, the future development of the software may stray from your individual needs.
