From I&T's 2007 Executive Summit: Making Insurance Company Transformation Real

It's not often one hears a note of unqualified optimism on behalf of what IT can contribute to an insurance enterprise, but Deborah Smallwood, chief transformation officer, ICW Group Insurance Services did just that as a reflection on her experience of driving a rapid technology transformation of the San Diego-based property/casualty insurer, as part of her presentation"Just Do It: Making Insurance Company Transformation a Reality," at Insurance & Technology's Executive Summit, held this year at The Phoenician, Scottsdale, Ariz. "We're the hub of the insurance industry," Smallwood said of CIOs, whose technology serves as the circulatory systems for insurance companies. "We are in a position to really transform the industry."Smallwood was brought on board at ICW to transform that company, after an engagement with the carrier as a TowerGroup analyst and consultant. While the ICW was making money, its leadership felt it needed to change, both in view of a hardening market, and of the likely effects of the burgeoning technological superiority of competing companies over the long haul.

Her evaluation of the company's current state was not the stuff that optimism is made of. "I found that we had no clear business strategy, no clear alignment between IT and business, no governance, no project management, and that the company was very manual," she said. "We had over 800 focus reports and numerous data stores."

Despite the generally backward state of the company's processes and technology, Smallwood judged from her analysis that, "the gaps were bridgeable." She was subsequently given authorization to drive a change to bring ICW from "laggard" to "fast follower" status, from a technology point of view. "In six to nine months we had to reorganize to align business to IT, have a single entry point from the business into IT, and develop a common strategy between the business and IT," she reported.

The initial transformation effort involved enlarging the IT organization from 80 to 130 professionals, along with 25 consultants. ICW also forged partnerships with Insurity, CSC, and IBM. Those partnerships, Smallwood asserted, have driven the introduction of project management disciplines and methodologies, supported the institution of an architectural blueprint and have already been instrumental in "delivering major projects that were out of control."

One of these was a runaway data warehouse project that has now seen a successfully completed first release. The new data warehouse will, among other things, provide the basis for reducing the number of the aforementioned 800 reports.

Reflecting on the success so far at ICW, Smallwood drew some observations about IT's role for insurance companies today that she believes should motivate transformational efforts. She said she had learned that, "IT best practices, methods and techniques are mature; ramping up IT is doable, fast and achievable; we are masters at it all and masters of change."

Smallwood then cautioned that transformation was evolutionary and that "we are never done." In developing a vision for change, she added, "you always have to know where you're going, but you need to adapt as you go.""We're the hub of the insurance industry," ICW's Deborah Smallwood said of CIOs, whose technology serves as the circulatory systems for insurance companies. "We are in a position to really transform the industry."

Anthony O'Donnell has covered technology in the insurance industry since 2000, when he joined the editorial staff of Insurance & Technology. As an editor and reporter for I&T and the InformationWeek Financial Services of TechWeb he has written on all areas of information ... View Full Bio