“Be Careful What You Wish For . . . “
Over the past few months I’ve had an increasing number of discussions with insurance industry clients and prospective clients, alliance partners and analysts regarding “managing complexity . . . increasing complexity”. These discussions frequently turn to a newer dimension of this “complexity challenge”; one that has been enabled via the availability of insurance-specific software products (n.b., whether full applications or components) that do provide a significant degree of “flexibility and adaptability”. A variety of such products have been architected and developed with a view to enabling a significant degree of “flexibility and adaptability”.
An increasingly frequent “complexity challenge” organizations face with this degree of adaptability and flexibility is the proliferation of implementations, instances, etc. that have been created without the benefit of important governance and management disciplines. Carriers are finding that this growing dimension of complexity is being enabled via these flexible, adaptable products. In some ways, it is analogous to “end-user computing” with increasingly powerful spreadsheet and database tools that enabled creation of what sometimes become “core business applications” subsequently. Yes, “solution implementations and maintenance” with these new products can be relatively quicker and easier to accomplish than “traditional package implementations”. However, the downstream complexity and cost of enhancing, maintaining and integrating these “flexible, adaptable solutions” can be very significant (and often unforeseen) if little (or no?) governance and management disciplines were applied at during their conceptualization, design and development. These flexible, adaptable insurance-specific products can provide a real leap forward relative to legacy environments and platforms that are closed, rigid and prohibitively expensive (and slow) to evolve as a business’ needs evolve. However, without due attention to governance and management disciplines at the outset, these products can lead to the proliferation of a “next generation” of complex, inconsistent and costly “solutions” for a carrier to manage, maintain, integrate and evolve. As the old adage goes: “be careful what you wish for . . . you may just get it”.
