Group Insurance Speed to Market: Why It's Hard to Achieve and Sustain
Who doesn’t love a consistent, winning team? We certainly do, although our respective choice of baseball teams – it’s now October, after all – may reflect otherwise (read: for Todd, his beloved St. Louis Cardinals, and for Ed, his treasured Boston Red Sox.) In baseball, a team that regularly wins World Series titles requires a deep bench of both pitching and hitting talent (although there’s the argument that good pitching will always beat good hitting, but we digress).
In group insurance, successful companies require consistent speed to market to get their products to the market quickly, to beat the competition and to get a jump on marketing. But consistent speed to market, like consistent pitching and hitting in baseball, is hard to achieve and sustain. In baseball, other unpredictable variables, such as team chemistry and player injuries, can pause or effectively end teams’ winning ways. With group insurance, it’s a bit easier to pinpoint more concrete reasons, namely:
- The lack of a consistent, repeatable approach to product management;
- The failure of product and IT teams to collaborate early in the development process (see our recent blog, “Group Insurance Speed to Market: The Importance of Early IT Involvement”) and;
- The legacy technology environments that hinder product launch timelines and regular product maintenance.i
Speed to Market Fundamentals
To continue with our baseball analogy, consistent, winning teams require specific fundamentals; mainly a foundation of steady hitting and pitching as we mentioned above. For speed to market, group insurers need three primary elements, that we explain in more detail below.
A consistent, repeatable product management approach.
Inconsistent approaches and lack of collaboration between operating units lead to unnecessary product duplication, which drives up maintenance costs for all involved. A repeated, disciplined approach to product lifecycle management, often achieved via a “product wizard,” can eliminate product redundancy. In addition, an optimal “product wizard” enables easy and repeatable product configuration, thus eliminating the time-consuming drudgery of repeated design and building of products and products’ components. Modular product architecture, often the foundation of insurers’ new, upgraded core systems, can also help avoid product redundancy and speed up product development. This is achieved via repeated “modules” that can be assembled in a shorter period, resulting in faster product development and a streamlined product portfolio that can be brought to market quickly.ii
Early collaboration between product and IT teams.
It’s been well documented that organizations who include their IT teams earlier in the design process deliver products faster than those that wait until later stages.iii We’ve also noticed that including IT earlier helps bring better perspective around how to best design a product that fits within the current, or even future, ecosystem. Involving IT from design to actual product deployment is especially critical in the group insurance industry, which still suffers from outdated, inflexible legacy technology. Finally, the early collaboration of design and IT can make a product stand out, which is especially important in group insurance’s overly commoditized marketplace.
Modern technology environments.
As noted earlier, group insurers’ well-known legacy technology systems are a major stumbling block to meeting product launch timelines as well as planned product maintenance. Cumbersome, outdated systems and their attendant manual workarounds result in sluggish production and can bring speed to market to an immediate halt. Most telling is a recent Deloitte Consulting LLP survey which revealed that over 90% of insurers feel that their current technology environment would be insufficient to support their product development capacity in the next three to five years.iv
For most group insurers, consistent and sustained speed to market remains a distant goal. To achieve it, insurers need to reassess their current strategies to involve IT from the start for better product development outcomes, as well as seriously consider a full core system upgrade to provide a better environment for a repeated, disciplined product lifecycle management approach. And unquestionably, a modernized technology environment can help expedite product development timelines as well as planned product maintenance. As for our teams’ next World Series titles, there’s always next year.
To see how Vitech’s V3locity solution can transform insurance administration operations, enable accelerated speed to market and product model objectives, while offering unparalleled security, click here.
i Speed to Market: (Part of the Insurance Series, “Benefits of a New Policy System: Why Going Live is Not Enough,” Deloitte Consulting LLP, April 2015.
iiEmbodiment Design: Modular Design and Product Architecture; Essential Product Development for Engineers.
iii Speed to Market for Life/Annuity/Benefits Insurers, Novarica Research Council Study, pg. 7.
iv Op Cit, Speed to Market, Deloitte Consulting LLP, April 2015.