When Alan Mercaldo joined MAG Mutual Insurance Company 16 years ago as a project manager, he could not have known he eventually would become the company's first-ever CIO. "As access to information became more critical due to company expansion into new states and lines of business, our leaders decided they needed an IT executive to help them leverage technology investments and make sure there was a common vision as we grew the organization," Mercaldo explains.
As his job responsibilities grew, so too did the Atlanta-based medical professional liability carrier. Since being promoted to CIO almost a decade ago, Mercaldo has helped the company grow the business by implementing leading-edge technologies that weren't around when he first joined the specialty lines carrier.
"When I started in 1992, MAG Mutual had a few stand-alone PCs and a shared printer," he comments. "Now, we have a wide-area network and a paperless imaging and workflow system. We've implemented a lot of technologies that weren't even available back then."
MAG Mutual also offers business and personal lines of insurance, financial services, and practice management solutions. Its 2007 assets exceeded $1.4 billion.
Mercaldo oversees an IT staff of 25 employees, most of whom work in Atlanta. Overall, MAG Mutual employs about 250 people. To augment his IT staff, Mercaldo has turned to outsourcing services and third-party applications rather than continuing to build his own. For example, in late 2006, MAG Mutual went with a hosted solution using CSC's Legal Solutions Suite for attorney loss adjustment expenses billing. In 2008, the company replaced its legacy claims system with a third-party application from Delphi Technologies.
"Outsourcing allows us to take advantage of newer technologies with skills I don't have in-house," Mercaldo says. "I can deploy browser-based and .NET applications faster and more readily by leveraging vendor resources."
Taking advantage of Web solutions will make it easier to fulfill one of his top technology priorities for 2009: focusing on customer service by expanding Web-based self-service capabilities.
In addition, MAG Mutual plans to institute a customer relationship management environment to create a one-source view of the customer across the enterprise. "Like most companies, we're looking at opportunities to service all our customers' needs," Mercaldo says. "Providing that elusive single view of the customer will make it easier for our insureds to do business with us."
Another IT priority in 2009 is the development of a formal business intelligence framework. Mercaldo plans to create executive and operational management dashboards and leverage the company's Business Objects platform to offer more advanced internal reporting and analysis capabilities.
"We want to provide more timely and interactive data so management can see trends in our book of business," Mercaldo says. "We want to help managers become more predictive in what's happening to the business as conditions change instead of looking at what happened through the rearview mirror."
A third priority is for MAG Mutual to move into virtualization technologies not only to reduce costs but to enhance the company's infrastructure to better manage its growth.
Mercaldo expects his IT priorities will help the company address business challenges created by today's soft market and slow economy. He has developed a strategic IT plan that aligns with the organization's efforts to become more agile in response to the current market. He also has helped MAG Mutual institute a multitiered governance model to better adapt to changing corporate and business needs.
Mercaldo's interest in technology was spurred by NASA's early space program, which he found captivating. After graduating from Hofstra University with a bachelor's degree in computer science, he moved to Atlanta to join a consulting company. Mercaldo worked in various IT roles in several industries, including retail, manufacturing, and mining. His first foray in the insurance industry was when he joined MAG Mutual.
Mercaldo points out the Internet and advances in PCs have led to enormous changes in how users process information and knowledge as well as to a growing awareness on the business side as to what technology can provide. "Our company has become a more sophisticated consumer of IT services, which is both a challenge and a blessing," he contends.
