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Motorists Insurance Group's User Stories Drive BI Buy-In

While MIG's IT organization's initial attempts to build enterprise BI capabilities lacked support, incremental delivery of business value through focused "User Stories" has put the company on track to develop BI as a core competency.

Recognizing that business intelligence (BI) capabilities were becoming a competitive necessity, Motorists Insurance Group (MIG) embarked on an enterprise BI strategy and roadmap to develop a core competency within the organization, according to CIO John Kessler. But as the breadth – and the expense – of the roadmap increased, support began to evaporate. Working with Centric Consulting, Kessler embarked on a "User Story" approach that delivered results incrementally – leading to not only acceptance but enthusiasm about BI strategy within the carrier's business leadership.

"In fact, we pursued a global BI strategy on multiple occasions without success," Kessler relates. "We turned to the User Story approach to gain the support of stakeholders who see the value – the idea is that light bulbs would go off, so to speak, and we would get business sponsorship."

MIG's (Columbus, Ohio; roughly $700 million in annual premium) broader BI strategy had emerged out of a need to come to terms with an increasingly complex data environment. The insurer had recognized the need for actionable data to support business decision making, but a combination of organic growth and expansion through its affiliation model had resulted in a complex application portfolio and widely dispersed data across the group.

"We had application sprawl – we don't have a single core platform, and that has exacerbated the problem of getting to the data," Kessler explains.

As a logical step toward developing needed capabilities, MIG began a project to define an enterprise BI strategic plan, which Kessler characterizes as an exhaustive effort that engaged several business stakeholders from multiple functional areas within the organization. Unfortunately, business commitment to the endeavor turned out to be more or less inversely proportionate to the project's size.

Having read about other companies' success with incremental approaches based on user success stories, MIG's CIO conferred with Chad Caldwell of Centric Consulting, a Columbus, Ohio-based consulting firm that Kessler calls a trusted advisor. "Chad was intimately acquainted with the difficulties we had trying to sell an enterprise strategy," he relates.

[3 signs your insurance company is analytically mature when it comes to BI]

Through its collaboration with Centric Consulting, MIG developed an approach based on asking business stakeholders to name a business problem they couldn't solve because they lacked the necessary data, the data was too difficult to access, or they had to wait for IT's intervention. The answers became MIG's "User Stories."

Kessler describes the approach as a strategy to build business buy-in through a succession low-cost, low-impact wins. "I was confident that if we delivered results, light bulbs about other ideas would go off and the business sponsorship would start to fall in line – and that's what happened," he says.

As the User Story approach was taking shape MIG's IT organization began educating team members on an agile implementation approach to BI, as distinct from the "big bang" approach implied by the original enterprise strategy. Kessler's organization then identified a set of User Stories and prioritized them through a cross-functional advisory committee composed of several vice presidents, according to Kessler. "We wanted to keep these small, starting with User Stories we could solve in relatively short order, maybe three months," he comments.

The initial user story, Workers Compensation Analytics, hewed close to the above timeline, beginning in Feb. 2012 and ending in May of that year. Chosen for its lower difficulty, faster delivery time and greater business value relative to other user stories, it aimed at reducing workers' comp claims costs and improving claims management. During the course of the project, Kessler's team learned that needed data was often found in additional data stores. "Much of the analytics data came from our claims system, but we also needed policy data to complete the picture of the premium and coverage analysis," he reports.

According to Teresa King, the project's business stakeholder or "Owner," the project provided data in real time about MIG's workers' comp loss experience, allowing better management of losses, greater control of medical and indemnity loss and expense, and conferring the ability to monitor trends. It also gives King's team the ability to track exposures by type of injury, class of business and state, to help them manage risk acceptability and loss control.

"We utilize the data warehouse regularly to measure the effectiveness of cost containment strategies and newly implemented workflows," King says. "We also compare our data to industry benchmarks to determine our strengths and opportunities for improvement – it has proven to be an invaluable tool for managing workers compensation claims."

MIG's second User Story, Policy & Premium Retention, aimed to translate statistical data into business terms in order to measure premium and policy retention across multiple companies and platforms. Because retention information was not stored in any system, the statistical data from many systems was required to calculate it – making the project much more difficult than originally anticipated, Kessler recalls. "We automated data balancing procedures to ensure that the extract matched what was being reported in the financial systems," he notes.

The project lasted roughly four months, but that included scope changes driven by the business Owner, in this case VP of accounting Joel Kratzer, who characterized the initiative as having "a focused scope, and an agile development approach [that] resulted in a business-led process that delivered valuable BI solutions in a prompt and effective manner."

In fact, in both of the above user stories, solution of the original problem led to pursuit of further "stories" within those departments, according to Kessler. "They continued to fund [the projects], and at the end of the day the delivery was much more than they had anticipated," he says.

Both stories also delivered on the objective of positioning MIG's business stakeholders to be better decision makers, able to understand fundamental questions about their business in a more timely and accurate fashion. MIG was able to get on the road to developing BI a capabilities by getting around the constraints of the magnitude of the required investment and time required for an enterprise-level initiative, according to Kessler. The success of the initial User Stories led to others, with a total of five having now been completed, and 55 on the waiting list. That puts MIG well on the way to achieving its full list of related objectives, which Kessler lists as follows:

  • Provide business insight utilizing BI practices & tools.

  • Generate some excitement and BI champions in the business.

  • Garner enough momentum and support for our long-term data & analytics needs, including the development of a BI Strategy and Roadmap to formalize a direction for the organization.

  • Establish BI as a core competency in the organization.

"As a result of our partnership with Centric Consulting and our User Story approach," Kessler comments, "we are well on our way to achieving these goals."

Kessler opines that the User Story approach benefitted MIG not only by giving clarity to the potential of BI for the organization, but also because it required a relatively small initial investment and far less risk than a "big bang" effort. He acknowledges that in the three years since MIG began working on the User Story initiative related technologies have improved on point of maturity and price. However, in the long term, the cumulative costs of a User Story approach would be excessive, despite the degree of reuse and institutional discipline that Kessler's team has developed.

"There are diminishing returns, so now the challenge is to transition from the user story approach to a more intentional overall strategy, while keeping the momentum going," Kessler says. "We have gained many internal champions while we pursue putting together a more intentional overall data and analytics strategy."

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

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