Senior executives of smaller insurance companies rely on the energy and diligence of their staff to overcome serious flaws in their systems and processes. That is a short-term tactic that for too many companies has unfortunately become a long-term strategy.
For many captive managers and small insurance companies, the question is rarely, ‘do we need a new policy management system’. The answer is obviously ‘yes’, and occasionally ‘duh’ because the current system was outdated ten years ago, or longer. So, management is certainly aware, and there may have been serious efforts to evaluate new software. But often those plans go awry and the plug is pulled before the new system goes live.
System changes are never easy. They are perhaps the hardest undertaking for any company, large or small, because it involves every person, requires coordination between very diverse departments, demands crisp leadership from managers who must be willing to make hard decisions and whose very decisions will impact the operations of the company for years to come.
With all that in mind, it is easy to see why so many implementations fail – most people aren’t sad when the plug is pulled, because then they can go back to doing their jobs. Even if the current process is not ideal, it’s the proverbial devil they know and it’s often easier to stay with what you know even if it’s not the best for the future of the company.
As the chief executive officer of a company for many years, and as a consultant to the insurance industry for years after that, my belief was that change had to be built in to the fabric of the company’s culture. Projects towards the ‘new’ were always in motion, people took on different roles and new tasks, there was interest and, mostly, enthusiasm for what was next. It was not unusual for us to build a new policy management system every five years to meet our evolving business needs.
While this level of focus on the system helps streamline operations and enable growth, it is not typical. What is more typical, is that there is a lot of wishing, hoping and praying that it all hangs together for a while longer while the systems decision is repeatedly delayed. So many patches and fixes and workarounds later, when some of the software is no longer even supported by the original vendor, the insurance company starts taking risks that it would tell its insureds never to take.
The better risk is to choose the right software partner and dig in to the process. Done right, it can be energizing and cathartic; a new system with new processes will emerge, and there won’t be any more wishin’ and hopin’ that the old system will live another day. The plug can be pulled on the old system and the new system will be plugged in and ready to do its job so the team can more effectively do theirs. For us who insure risk for a living, surely, we can understand the better risk?
~ Bill Montei, CEO, founded Megalodon Insurance Systems with a simple yet BIG idea: provide small and mid-sized insurance companies powerful policy & claims management software solutions at a price that is within reach. To talk to Bill directly, please call: (608) 709-2154.