Some call it nostalgia. Others call it stuck in a bygone era. No matter which, we all have to come to terms with the fact that the world has changed due to technology and we all need to evolve or be lost in history.
It wasn’t that long ago that people were driving down the highway in an 8-cylander car burning leaded gasoline and playing 8-track tapes. Now we’ve got hybrids with music coming to our cars from the cloud. The same technological revolution holds true for insurance companies IT. We’ve evolved from punch cards to tapes to DVDs to hosted and now … SaaS, BPaaS and yes … the Cloud.
For years insurers had large computer rooms with all kinds of hardware and software, expanding as the business expanded or the technology changed. But, just as we now listen to MP3s from the Cloud, the same can be done with core insurance software. Insurers don’t need to build, store and manage these environments to make sure it meets their needs. Today’s hardware and core insurance software can be managed in a different location, by different people and organizations all in a secure way.
Each and every day, insurance CIOs are making crucial technology investments and deployment decisions that shape their companies’ strategic abilities and futures. One of those decisions is how to deploy solutions and services that will make the organization responsive, efficient, cost effective and future ready. And no, that doesn’t involve the large computer rooms anymore.
For some, they still need to manage and touch that piece of software to know it is there and working. They continue to select new solutions using traditional on-premise deployment model rather than being forward-thinking and future ready, reallocating resources to support other strategic initiatives by utilizing the capabilities we have in the 2013 not in 1963. Instead, insurers need to more aggressively look and consider the advanced benefits of hosted, SaaS, Cloud and BPaaS models. Just as MP3s provided incredible benefits over 8-tracks, these models offer greater flexibility and agility to respond to opportunities and challenges making insurers more agile.
So why do we need to change now? The breadth and depth of change in our industry over the last five years exposed the limitations of our traditional legacy paradigms of business models, customer expectations, distribution channels, core insurance solutions and delivery models.
Each and every day, insurance CIO’s are making crucial technology investment and deployment decisions that will shape their companies’ strategic abilities in not only replacing legacy systems but in positioning them to respond to future demands quickly.
Unfortunately, too many insurers are continuing to select new solutions using traditional deployment model of on-premise rather than considering hosted, SaaS, Cloud and BPaaS models. Rather than continue down the same old path, or as the saying goes “pave the cow path”, insurers should seek core insurance software that can be deployed using these modern alternative models offering greater flexibility, agility and cost variability to respond to the opportunities and challenges facing business better than our old paradigm. In addition, these alternative models offer critical business continuity. As we all learned over the past few years, having remote capabilities in times of hurricanes, floods, tornadoes and more is crucial if you’re going to be able to operate under dire circumstances.
Finally, as insurance executives consider the appropriate deployment model for their business today, they must ensure the software and vendor can easily transition to other models in the future. So while you may select hosting today, you may want SaaS or Cloud in the near future.
In the end it all comes down to one overall thing … competitive advantage.
To be a leader you must have vision and that vision must include more fluid, agile organizations with robust core software, analytics and BPO solutions that quickly and effectively respond to change. These solutions must allow the organization to focus on core competencies andengage strategic partners to do those things that are not core so that they can embrace new opportunities to empower innovation and success.
We are on the brink of a new era in the P&C insurance industry where we are rethinking how we operate our businesses. It is a bright future of new business models as companies take advantage of new technologies and delivery options to reinvent themselves, create new levels of competition and be “future ready”.
Leave those 8-tracks behind and the large computer rooms and embrace the future with core insurance software that can operate in alternative deployment models today and in the future.
Karen Sullivan is the executive vice president, Delivery for Innovation Group North America. She can be reached for further comment or information via email at firstname.lastname@example.org
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