Situation: We are seeing unprecedented investment by small- to mid-sized carriers in policy administration implementations. The convergence of aging legacy platforms, complex market demands, and a more mature vendor landscape has ushered in a unique period in which it is possible for small- to mid-sized carriers to change systems with less risk than ever before. Carriers that do this successfully will be well positioned to leapfrog larger, better-funded competitors thanks to improved product flexibility and timeliness — not to mention lower IT costs.
Complication: Most new policy admin transformation projects are “challenged” and only a small percentage of them realize the full benefits of change. The goal of a policy administration project should not be the implementation of yet another application, but to deliver transformative capabilities to the business.
Solution: Carriers should harness the opportunity by ensuring their policy admin transformation projects make an impact on the organization’s growth and profitability. Effective transformations feature the ability to 1) continually map daily program management decisions to the original benefits case, 2) rapidly deliver code in an iterative manner, and 3) utilize a policy-specific framework to proactively identify and address common project challenges.
More specifically, successful transformations overcome potentially major obstacles by developing capabilities in the following 10 areas.
Core Business Capabilities
Core Delivery Capabilities
Supplier management – Partner with a general contractor to address sourcing needs (e.g., skill gaps, variable capacity in case of the need to quickly ramp up or down resources, optimized mix of onshore and offshore resources), provide industry experience across a variety of perspectives, and share accountability for delivering agreed upon scope within planned schedule and budget, thereby mitigating implementation risk.
Carriers that focus on their policy administration projects’ core delivery capabilities tend to design, manage, and govern the projects on time and within budget. That said carriers that focus on increased growth and profitability will need to optimize their policy administration transformation by focusing on core business capabilities. By doing both, carriers can make substantial improvements to their business and surpass the competition.
Imran Ilyas, partner with PwC's Advisory Services, coauthored this piece with Matt Hurlbut, Matt Wolff, David Tiejen and Marc Gallo of PwC’s Advisory Services.
Readers are encouraged to respond to Imran using the “Add Your Comments” box below.
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