To Handle the Financial Crisis – Embrace Technology
A recent report by Celent on “Handling the Crisis: Update on Q1 Insurance Industry Expectations and Strategies” once again reiterates the strong role technology is perceived to play in the insurance industry. We’ve been quite direct in our assessment of insurer IT investment in a couple of our previous posts “All roads lead to technology” and “Carrier’s competitive edge depends on IT”. As the predominant focus is on cost reduction in the insurance industry, there is a paradigm shift in the role of IT investment.
“The question for CIOs is how technology can help the business reduce costs. This is an important change from previous recessions, where IT costs were cut indiscriminately.” says Catherine Stagg-Macey, Senior Analyst and coauthor of the report.
Today, driven by innovation, technology has taken a far more responsible position in improving the overall operational efficiency of an organization. Stepping in for a drastic reduction of manual intervention in workflow cycles means saving time and effort. Utilizing the same time for business critical activities ensures improved productivity. This will have a direct impact on the company bottom line.
The insurance industry, historically, being complex in its processes, is all the more vulnerable for operational lax. If, mired in siloed systems, complex calculations and lack of coordination among the cross-functional teams, insurers will find themselves challenged to come to terms with the latest market trends and best practices. The contemporaries are well aware of this reality check as can be inferred from the report by Celent.