With policy administration system (PAS) transformations at or near the top of most insurance carriers' to-do lists, it is critical for companies to recognize the massive organizational effort required to successfully execute, roll-out, and realize the benefits of a PAS replacement. Because PAS is the lifeline of an insurance carrier's business, undergoing a PAS replacement affects nearly everyone in the organization, as well as agents and insureds. As a result, organizational change management is essential to prepare stakeholders for change and ensure the buy-in required to succeed with a transformation of this magnitude.

To say that PAS transformations are complicated would be a gross understatement - these types of efforts have been compared to swapping out the engines of a 747 in mid-flight. Accordingly, an incredible amount of thought goes into planning, designing, developing and testing the solution. Unfortunately, this approach often treats organizational change management as an afterthought and leaves carriers ill-prepared to reap the benefits of a solution they work so hard to develop. In some cases, this neglect of change management causes such strong backlash that the solution is shelved.

In my previous posts, I discussed the importance of developing a business strategy, business case and incremental roadmap for policy administration transformation systems, as well as the critical vendor selection and mobilization phases. This post focuses on what you need to take into account when defining and executing the lynchpin of a successful PAS transformation - your organization's change management strategy. 

People tend to think of organizational change management simply as training, but it goes much deeper than that. A well-defined organizational change management strategy includes the identification of all stakeholders that your PAS transformation will affect, as well as the subsequent communication, training, pilot, roll-out and support approaches necessary for ensuring buy-in and managing change. The following should be useful considerations in the development of an organizational change management strategy for your PAS journey:

1)      Conduct An Organizational Readiness Assessment - Perform a change history and organization readiness assessment in order to evaluate how your organization has handled change in the past and determine how prepared your organization is to accommodate change going forward.

2)      Consider All Constituents - Identify all stakeholders that your PAS transformation will affect, and develop tailored change management plans. These plans should be specific and address the needs of each stakeholder group in order to minimize disruption and help them navigate change.

3)      Focus on Adoption By Developing "Change Champions" - Engage a diverse set of key stakeholders from a variety of stakeholder groups, levels and geographies early and often to get their input and obtain buy-in along the way. These individuals will become your "change champions" that advocate change throughout the organization.

4)      Create A Comprehensive Communication Plan - Create a communication plan that identifies all constituents, outlines the type of information that will be communicated, determines the frequency / mechanism for communications, and establishes reliable feedback mechanisms.

5)      Communicate And Reinforce Objectives - Provide clear objectives for the PAS transformation and tell people what it means to them, sharing not only what you know, but also what you don't know. More importantly, figure out creative ways to remind people of the objectives - develop a theme for the effort, display posters advertising the initiative around the building, print it on mouse pads, etc.

6)      Be Consistent With Your Message - Communicate consistently across all levels of the organization - inconsistency fuels the rumor mill and causes confusion. Combat this by providing talking points / FAQs to officers, directors and managers to ensure the delivery of a consistent message.

7)      Select Your Pilot Carefully - Consider important dimensions such as geography, product mix, size of book of business and level of leadership support when selecting your pilot group. Identify potential pilot candidates early in the process and work closely with them to ensure that the pilot maximizes the overall probability of success by achieving high levels of adoption among users.

8)      Utilize An Extended Pilot - Take your time piloting your solution; a common mistake is to roll-out too quickly. Instead, pilot to a small group of users for several months to ensure adoption and incorporate their feedback, further strengthening your solution and developing additional "change champions" along the way.

9)      Use A Dedicated Training Team - Ensure consistency in content generation by utilizing the same group of people to create standard operating procedures, job aids, CBTs and classroom material. Whenever possible, have the individuals who created the training materials deliver the training classes to improve the overall quality of the training experience.

10)  Plan Adequately For Roll-out Support - Coordinate a PAS help desk comprised of both business and technical users, and create triage teams to address urgent issues. If possible, send support team members to various sites as they "go-live" to support their needs and facilitate their overall transition.

Companies often underestimate the effort required to manage organizational change, but it truly is the lynchpin of a PAS transformation effort. The difference between a successful implementation and a failed one often comes down to how well a company manages the disruption that comes with their multi-million dollar, multi-year investment in a new PAS. Carriers that recognize the importance of organizational change management understand the need to 1) Create a change vision, 2) Conduct thorough change planning, and 3) Rigorously execute that change plan in order to maximize their investment. Can you really afford not to do so?

Imran Ilyas, partner with PwC's Diamond Advisory Services insurance practice, coauthored this piece with Frank Wittman, director, PwC’s Diamond Advisory Services.

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