When Northwestern Mutual Insurance made the decision to ally itscorporate planning group with its information systems departmentback in March 2000, the life insurance and financial servicescompany turned to Deborah Beck and promoted her to the position ofexecutive vice president. The goal was to make sure we were doingas much as we could to align our strategy with our technology, saysBeck. She joined Milwaukee-based Northwestern in 1975 as anattorney and has held a number of positions on the business side,but none on the technology side. Northwestern reported $9.8 billionin premium revenue in 2001 with $690 billion worth of lifeinsurance in force.

Among the new initiatives this quiet company is implementing toturn up the volume are Web sites for its field force of 7,800representatives and agencies that are linked to the NorthwesternMutual Financial Network site. These sites allow clients tointeract directly with their representative and learn more aboutfinancial issues. In addition, the insurer is leveraging a Siebelsystem so that agents will have customizable client databases attheir fingertips, with the same information being shared with thehome office, client service center, etc.

Beck feels it is important business-people know the technologythey are using, and technology people should be aware of what makesan insurance carrier operate. Here, she shares insights onstrategically partnering business and technology, and more.

Tech Decisions: How have you been ableto involve the uppermanagement of Northwestern in the technology side?

Deborah Beck: The time was right to do this, and to my pleasantsurprise, I found there was a great deal of interest both on thepart of technology professionals and on the business side to domore with technology together as a partnership. Many of the issuesIT professionals are dealing with require active participation fromthe business side. In the past, these issues were more separate.Now, theyre very much intertwined. People on the business side seeeverything theyre trying to do with regard to business strategyinvolves technology of some sort. People on the IT side see therehas to be active participation on the business side to accomplishthings.

Tech Decisions: How does Northwestern view technologyas a toolor as a business driver?

Beck: Its always been a tool, but its become more of a strategictool to provide what were trying to do with our customers and ourfield force. Virtually everything we do these days involvestechnologywhen were trying to provide service to our customers,when were trying to develop new customers, when were trying to makeour field force more productive, when were trying to maintain ourlow cost position. All of these things involve technology.Technology projects have become more expensive, so you have to seemaintaining technology expenses as part of the strategy of thecompany to keep costs low and provide an efficient product for yourcustomer.

Tech Decisions: What is Northwesterns strategy toward improvingefficienciesdevelop tools in-house or look outside to vendors?

Beck: We do some of both. Historically, weve done most of ourwork in-house, but in the last few years weve moved to moreoutsourcing. It depends on whether we feel we have a corecompetency on the technology side, what were trying to accomplish,and whether we can do it more efficiently if we outsource it. Thatsa good example of where you need the participation of the businessside. If you are outsourcing, you want to get an off-the-shelfsolution, and that sometimes requires the business side to changeits work process to match the solution, rather than buyingsomething and modifying it or feeling you have to build it yourselfto match the workflow the business side has established.

Tech Decisions: In what areas does North-western outsource?

Beck: We started outsourcing some of our Y2K work to a companyin India, and weve continued to use it for some of our applicationdevelopment work. We also outsource our Web hosting. Those would bethe biggest things.

Tech Decisions: What are some of the new technology tools youhave seen that impress you?

Beck: When you see things early on it all looks good, frankly.One of the things we try to do here is pilot programs for newtechnologies, so we are trying things on a small scale to see whatworks. Its a way we try to balance being innovative with a low costcompany. Were very interested in how wireless might help make ourfield force more productive, so weve done some experimenting withthat. We use a targeted approach to try out new technologies in asmaller scale and either expand it or [determine] the technology isnot quite ready yet. Were still absorbing opportunities provided bythe Internet and wireless.

Tech Decisions: How do you react when you hear analysts sayinsurance is lagging behind other financial services fields when itcomes to technology?

Beck: I think Northwestern Mutual has had many examples of beingquite innovative with technology. We were one of the firstcompanies to have a corporate Web site way back in 1995. We were,in fact, the first company to buy an IBM mainframe back in 1957.Thats ancient history, of course. I can think of many examples, soI dont think thats an accurate description of where we are. Theinsurance industry deals with products that have a very long timehorizon. Our average claim on a life insurance policy comes afterthe policy has been in force for 38 years. Thats a long time tosupport a product you are putting in the market. We have to developsystems we can maintain for a long period of time. We have an arrayof products we want to be able to interact with each other, so wetend to have quite complex systems. There are some reasons we arecautious about technology, but I dont agree were not innovative inour use of technology.

Tech Decisions: How has the insurance industry impressed youwith its innovation?

Beck: A lot of what happens is based on the mission of thecompany and what you are trying to accomplish. Were closely tiedwith our field force and see value in having the customer deal witha financial representative who can give expert guidance in avalue-added relationship. When you compare what we do withtechnology and what somebody else does, you have to look at thewhole package. For example, Fidelity has a tremendous Web site.Thats also its total distribution system. We have 7,500 financialrepresentatives who help customers with their financial andinsurance plans. We want to provide technology that balancesservice directly to the customer and services that help make thefinancial representatives more productive.

Tech Decisions: Is there anything that Northwestern Mutual isworking on now that has you excited?

Beck: Were quite excited about the work were doing with ourinvestment products and the technology that will support them. Thathas been a growth area for us since we purchased the Frank RussellCompany a few years ago. It helps balance our product line, so wereable to provide a total financial security package to our customer.Were currently evaluating some technology, so I cant say wevelanded on one, but were looking at enhancing the computer-assistedplanning tool we use and the asset allocation tools. Were probablygoing to come up with a mixture of in-house and outsourcedsolutions.

Tech Decisions: You come from the operations side. How has thatworked with your IT staff?

Beck: A lot of aligning technology with business strategy isabout prioritization. What we try to do is have a very thoughtfulprocess of prioritization. The IT people see the value ofhavingmore businesspeople actively interested in technology. We started atechnology-mentoring program where we matched up technicalprofessionals with our senior executives. They do some one-on-onetraining, and once a month we get together for a bag lunch sessionwhere we talk about technology issues. The IT professionals areexcited about this opportunity to talk about what they do, whatissues they are facing, what the new technologies are, and to showhow our architecture is designed. The people on the business sideare thirsting for this knowledge so they can make better decisionsabout the technology that supports their business strategy.

Tech Decisions: Have you found the technology staff is moreinterested in the business side, or the business side is moreinterested in the technology?

Beck: People at all levels of the organization understand theyneed to know the other side. Before, people on the business sidedelegated the technology issues to someone on their staff to workwith our information systems department. Now, they see the need tounderstand these things themselves. Similarly, our CIO alwaysunderstood the business strategy, but now people at all levels ofthe information services department understand they need to knowthe business strategy so they can talk to the client in broaderterms than just specifically what their project is intended toaccomplish.