The Full Story
InsuranceCo*, a leading underwriter of life, auto and other insurance products, was undergoing a large-scale, strategic transformation with a strong focus on IT.
Although InsuranceCo spent less on IT than competitors, its ROI on IT was weaker. In addition, its IT organization was weighted toward pure technical skills and lacked personnel with business management skills. Senior management too lacked agreement regarding the IT strategic direction.
The industry was deregulating, and InsuranceCo needed faster and more flexible IT tools to cope with accelerated product life cycle, more integrated financial management and a step up demand for CRM solutions.
InsuranceCo asked Bain to advise on the following issues:
- How does InsuranceCo's IT capability compare to industry benchmarks?
- Given its business strategy, what should InsuranceCo's IT strategy be in the future?
- How should its IT strategy be implemented?
- What governance and process should it follow to effectively and efficiently manage IT?
Bain created a 5-step approach to addressing IT transformation challenges and issues.
- Ensure business/IT alignment by clarifying POD (Point of Departure) and POA (Point of Arrival) of IT
- Engage CIO in the business strategy development process to identify IT requirements related to business strategy & engage business management in planning, implementation, and assessment of IT projects
- Lead strategic IT decision-making and accountability to the business unit level
- Establish rigorous project management process
- Make decisions based on quantitative cost-benefit analysis
- Introduce new function of business analyst to bridge the communication gap between the business departments and IT department
- Pilot test with end-users in implementation
- Launch new function-based organization to increase efficiency and promote IT expertise through proper division of work
* We take our clients' confidentiality seriously. While we've changed their names, the results are real.