Reporting process transformation is becoming a major issue for many European insurers. As previewed in our recent blog post, a few tips that we’ve gathered from the work we’ve been doing in this area may help companies along the way.
Like a good novel, successful reporting process transformation projects, in our experience, will have a beginning, a middle and an end, combining at each stage what we consider to be three essential and overlapping components — effective tools (systems), engaged people and a fit-for-purpose process.
Today’s tips cover the early-stage steps that can bolster a project’s chances of success.
Tip 1 — Be clear on the objective
This sounds like a statement of the obvious, but we’ve seen a number of programs flounder because they lacked clarity of purpose at the outset. Various and quite valid transformational objectives may include accelerating the process, reducing cost, or improving the quality of management information — it pays not to mix them up. For example, if the objective is to speed up the process — your base aim is to get the same results out more quickly — then don’t be distracted by things that change the numbers and which expose you to unnecessary reconciliation activity and put a drag on reaching your base aim.
Such clarity is extremely important because transformation programs can become a magnet for wish lists of model improvements and pet projects.
Just as important is to avoid framing an objective based on the current way of doing things. Yet, we often see the default is to start mapping out the current processes in great detail. Aside from being time-consuming and potentially disruptive, process mapping anchors views and potential solutions on the current state. Further, if your objective is to construct a fundamentally different process that delivers results in 15 days instead of 50 days, then detailed process maps of the status quo are of limited value anyway.
Tip 2 — Get the right people
We are talking here about successfully delivering a complex, multidisciplinary program. So you need access to a variety of skill sets: creativity; systems knowledge; people who understand the work methodologies and flows; and project management to name a few. You also want to leverage the experiences of people who have done this before.
Some of those skills will exist within your business. Some won’t, and you will likely need to work with other organizations. Equally, internal resources have to be used appropriately. For example, most internal finance teams are there to operate established processes and perform analyses; they are not usually process design or change experts. Therefore, putting them in project roles where they will need these skills may not be that useful, especially if they are going to revert later to being process operators and analysts.
The key message then is think carefully about who you appoint to which roles. This may mean a bit more management overhead, but it’s definitely better for reducing project delivery risk.
Tip 3 — Buy versus build?
When it comes to process transformation projects, you may need to curb the desire to start building new systems and processes. Do-it-yourself building projects don’t usually turn out that well; they nearly always create key person risk, and they are likely to offend your IT protocols.
It’s much more efficient to buy into vendor solutions and focus efforts on how to implement those within the business. The vendor community offers a range of solutions across the end-to-end reporting process, and they can spread the necessary maintenance and development costs across their entire client base.
Building on firm foundations
With a firm foundation laid for process transformation, you can turn your attention to the execution of the program. A future blog will offer some tips for this phase.
Richard Waller and Joyce Simmons are directors in the insurance consulting practice at Willis Towers Watson.