Ask any CIO: One of insurance information technology’s biggest headaches revolves around how to keep up with a technology market that is evolving at a frighteningly rapid pace. No one wants to be left behind, but it’s impossible keep up to date with every innovation on the market.
As a result, most carriers end up with several disparate systems handling their various business processes. But as IT is increasingly recognized as an area that can actually drive business growth, it becomes even more important that all a carrier’s data is transparent and available across all systems.
Investing in a broad, all-encompassing business management system might be the right choice for you, if you have a few million dollars and months of installation and training time to spare. But the chances are you don’t have such luxuries, and the legacy systems you’ve already invested significant time and money in work just fine on their own. They just need to be able to work with each other.
Legacy systems are the arteries of an insurance company. They contain the crucial data that is the carrier’s lifeblood, and they drive the various processes that constitute the heart of the company’s operations. Why replace such systems when they are clearly more than capable of doing their jobs? A better option may be to extend both their lifespan and their capabilities by using one of several integration technologies.
When to integrate, when to replace
There are several reasons why a carrier may want to replace its legacy systems. In some cases, there may be a current lack of understanding of the system because it was implemented years ago and the IT personnel responsible for its installation have since left the company. Documents and manuals may have long ago been misplaced. Or it’s possible that the change simply comes from the desire to improve quality and efficiency.
But do any of these reasons actually mean that you absolutely must make way for new technology? Let’s not forget that implementing new technologies throws up a whole new set of conundrums that need to be addressed. What about the inevitable downtime involved in making this transition? What about the retraining of your staff on the new system? What about the final bill from the new system vendor? If you’re the one responsible for answering these questions, then perhaps you need to spend some time thinking about what role your existing IT investments can play in the new environment.
Extending system life through BPI
One of the main reasons why companies consider replacing their legacy systems is their lack of flexibility. Data is often trapped inside disparate silos–such as policy administration or underwriting–and unavailable to other areas of the enterprise. In today’s economy, where customers demand instant access to their information, and organizations want a “360-degree view” of each customer, data silos are analogous to clots in the arteries. Insurers need to find ways to unclog the flow of information and share it across every line of business.
This first step in sharing data is acquiring it from the data silos. One technology that has proven very useful for this is BPI, or business process integration. BPI can be used to build connections between legacy systems and data silos, letting them share information in a way they never could before.
Acquiring data via BPI starts with modeling the process. This is typically done using a graphical interface, similar to a flow chart. So, for example, if a carrier wants to build connections between its policy admin system and its claims system, it can map connections between those systems, specifying which data fields to share (e.g., the customer’s name, address, policy number, etc.). The graphical interface of most BPI suites means that building connections is much faster and easier than traditional hand-coding methods. Development cycles which once would have taken weeks can often be reduced to days.
BPI can not only acquire data, it can automate processes which have traditionally needed manual intervention. For example, updating a customer record typically requires manual re-entry of data into several disparate systems. BPI can be used to connect a Web form to all the carrier’s back-end systems. When an employee enters the new information into the form, the information is automatically populated to all the appropriate systems, such as policy admin, claims admin and CRM. BPI connectors such as these can let carriers extend both the lifespan and usefulness of their existing IT investments.
XML: The great enabler
Once the data has been acquired, the next step involves putting it to work. Eminently useful assets in this process are extensible languages such as XML. XML is gaining traction as a way to share information between carriers and agents, but XML can also be used to improve communications within a carrier’s operations.
After the information has been acquired from data silos, it must be presented in a context-appropriate view–for example, a policy document or claims form. This can be done using XML templates. Document designers can control the layout of these templates using XSL style sheets and/or a graphical interface, thus formatting the documents according to the carrier’s specifications. The finished documents can be printed, e-mailed or presented via a Web portal. In this way, the information is delivered to the right user, at the right time, in the right format.
Ease of deployment is another advantage of using XML and BPI to extend the lifespan of legacy systems. XML or BPI solutions can be implemented without any changes to the existing systems. This means that IT staff will not need a wealth of expertise or a deep understanding of the existing database’s data dictionary.
Extending the usable life of legacy systems is critical to achieving a better return on the original investment, and justifies a newer investment in integration solutions. This is especially important since many document-intensive companies have made investments in large mainframe systems which absorb a significant portion of their IT budgets. For these companies, integration technologies are important to extending the use of the information stored in their systems.
Legacy systems frequently form the core of a company’s business technology infrastructure. It’s vital that organizations strive to get the most out of these essential components. Enablers such as XML and BPI provide options to help unclog those arteries and ensure that companies stay fit, healthy and profitable.