Implementing a New Policy Administration Platform? Don't Pave the Cow Path!

By Mike Boltz

Congratulations, you have made the major strategic decision to implement a new policy administration platform. Chances are you are suffering the pain of legacy administration systems and the limitations they place on your business model. Maybe it's difficulty in bringing new products to market in a quick and cost efficient manner. Maybe you suffer poor customer experience due to information sprawling across multiple systems. Maybe your legacy platform is on its last legs, and you suffer frequent business interruptions. Whatever the drivers, you are about to embark on a significant investment in resources, time and money. This is a great opportunity to leverage the new policy administration project to enhance your overall business model and streamline processing, front-office sales through back-office administration.Implementing a new policy administration platform provides the perfect opportunity to evaluate your entire business model. Compare it to souping-up your car: you would not drop in a new, more powerful engine without also considering your tires, brakes and other critical components required to maximize performance. The same is true of a new policy administration platform. The benefits you enjoy will be dramatically enhanced if you leverage the system throughout your end-to-end workflow. Too many administration policy implementation projects focus on the legacy system alone; they tend to "pave the cow path" and reincarnate legacy processes - which are often vestigial results of legacy system glitches or "features" and work-arounds that ossified into habits. Following this "It's the way we have always done things" approach squanders the opportunity to establish the most efficient end-to-end process the new capabilities can support.

Current market conditions demand new ways of processing business from front to back, and there is no question that, through the use of business process modeling (BPM) you will be able to identify processing bottlenecks and inefficient processes.

The prospect of a BPM exercise may be daunting, but there are many vendors experienced with BPM that can help you structure your initiative for the best possible cost/benefit outcome. They can help you explore opportunities for improvement, even to the extent of changing your business model. For example, some carriers have leveraged new systems capabilities and automated workflow to support more of a consumer self-service business model.

Business process re-engineering can be as limited or expansive as choose, but it is wise to keep practicality in mind. One of the pitfalls of BPM is attempting sweeping changes. It is important to be realistic and pace yourself; aim for objectives that create the most benefit, such as eliminating redundant or inefficient processes. And be sure to prioritize and phase deliverables.

The final consideration for your new policy administration platform program is the implementation migration roadmap. Will you be doing a massive legacy conversion to the new system? Maybe you will only be putting up new products and new business on the new system. Regardless of your approach, consider that the business does not stand still during migration and there will be a tendency to want to revert back to the legacy systems when conflicts arise. You need a clear migration path and must manage that daily with your stakeholders during pre and post implementation.

Now is the time to leverage BPM as part of your new policy administration implementation program. Take advantage of this initiative to enhance your cost benefit through improvements in your end-to-end work flow. This economy will improve at some point, and when it does, you will be well-positioned to take advantage of your new system and kick the stuffing out of the competition!

Mike Boltz, currently an independent consultant for the insurance industry, is former EVP and CIO of West Des Moines, Iowa-based Aviva USA. He can be reached at mboltz925@yahoo.com or (515) 267-9032.Implementing a new policy administration platform provides the perfect opportunity to evaluate your entire business model. Compare it to souping-up your car: you would not drop in a new, more powerful engine without also considering your tires, brakes and other critical components required to maximize performance.