Filed Under:Carrier Innovations, Information Security

IT All-Stars 2007

What makes an all-star team? No single, scientific formula has been developed to gauge the quality of an IT leader. However, after getting to know the seven members of Tech Decision's first all-star squad, it is easier to see the qualities that make these people among the best the insurance industry has to offer.

Some of those qualities include leadership, inquisitiveness, pride, teamwork, a strong work ethic, and the ability to communicate with everyone from the IT shop to the underwriting department. Not all have these traits in the same amount, but that's what makes each of them different and special--all-stars, if you will.

Take Srinivas Koushik, CIO of Nationwide's property/casualty company. Koushik uses his communication skills to blog on the internal Nationwide Web site about, among other things, educating those who want to be leaders rather than simply managers.

IT leaders such as Jeff Fabry of Island Insurance Company (and we're not talking Long Island) face challenges based on where they are located. The Internet may have made IT ubiquitous, but whether you are in Hawaii or Hastings, Mich., it is important to find and train quality people because, as every one of our all-stars attest, it is the front-line personnel who make an IT department click.

We invite you to come to know this group a little better and learn their stories. In addition to Koushik and Fabry, we present Bob Eshelbrenner of Hastings Mutual, who spends time networking with his IT and business counterparts to stay on top of trends; Darby O'Neill of Princeton Insurance, who has to find ways to make systems work for a specialty line; Darcy Cypher of Farm Bureau Insurance of Michigan, who faces the challenge of directing an IT shop for a life and a property/casualty company; Neal Ruffalo of ACUITY, who has developed a set of rules a CIO should live by; and Ursula Foley of XL Capital, who faces global issues on a daily basis.

Srinivas Koushik, CIO of Nationwide Property & Casualty Company, believes his fundamental role is to help lead the organization to where it is going to be two or three years from now.

Looking into the future is part of what makes Koushik an outstanding CIO, but in today's world that means more than simply knowing what is going to happen with technology. "It's also global trends and what's happening in the marketplace," he says. "If you don't do that, there's no way of taking this organization into the future."

Koushik admits he feels the pressure to stay abreast of what's happening but also finds it exciting. "There are some interesting things happening in the infrastructure space and the application development space," he says. "We really have to be ahead of that. I see a lot of people who don't have a complete understanding [of those concepts]."

Fifteen or 20 years ago, Koushik believes it was possible for a non-IT person to get trained in IT and be reasonably competent. He doesn't see that as a possibility anymore because of the complexity of the systems and the technology needed to pull it all together. "The number of people who can cross over and be effective in IT is going to go down," he says. "Producing engineers and the people who understand computers from our universities is going to be critical."

Koushik likes to spend a lot of time on Nationwide's projects, which he feels are on the cutting edge. That can mean time spent inspecting projects or talking to the team members assigned to the task. "Staying much closer to those projects helps me keep abreast of things," he says, adding he would never think of walking into a meeting with his team without having an understanding of the technology. "From a leadership perspective, my team members have to see someone they are not going to discount right away because he's not a technical person," he asserts.

Koushik maintains his background as an IBM distinguished engineer and a member of the IBM Academy of Technology helps him understand new thinking. He also likes to visit the labs of Nationwide's business partners, such as HP, Cisco, IBM, and Microsoft. "I don't spend as much time in conferences because I think a lot of people are out there to sell stuff," he says. "I tend to go more to lab-type visits. I've done at least two to three a year for the last five years I've been at Nationwide."

The ultimate test of staying on top of things comes at home. Koushik has a teenage daughter who has shown an interest in technology. "It's amazing what these kids are learning in high school," he says. "Some of the things I did as part of my master's degree program they are doing in high school." His daughter took an advanced Java and J2EE course last year as a sophomore. "In order to help her out at home, I had to keep at least one lesson ahead of her," he says with a laugh.

Not many insurance IT leaders have a five-year stint as an insurance lobbyist on their r?sum? as Darcy Cypher does. The current vice president of information systems with Farm Bureau Insurance of Michigan believes her time spent lobbying at the state and national level back in the 1990s offered her a great opportunity both to work with her company's executive management team and to achieve a broader view of the industry.

"[Lobbying] gave me a global view of the company vs. just coming up through the IT track," she says.

To stay ahead of what is happening in the industry today, Cypher places a great deal of emphasis on networking with peer companies, understanding what the competition is doing, and taking advantage of third-party vendors to learn more about technology and how it is being leveraged in the business world. "It is the charge from our highest-level management that the primary job for the IT directors and myself is to set a technology course for the company," she says. "We're not big enough to find all that out on our own, so we have to learn through the experience of others."

Cypher is convinced purchasing vendor packages is the best option for a small to midtier company. "We can't afford to be in the build-it business," she says. "It takes too long and takes too many specialized skills we can't afford or maintain."

An additional challenge Farm Bureau faces is it is a multiline company offering both life and property/casualty insurance. "It means there is a lot of technology to keep up with servicing all those product lines and the functions within those product lines," says Cypher.

The life insurance line has its own unit within the IT department, running on an older system that still is performing well. But Cypher points out one of the major challenges for the company is transitioning off of some legacy systems and finding either replacement solutions or, in some cases, a wrap-around solution that will give the carrier today's services using the back-end processes it already has built.

Farm Bureau is adopting a new contact management system that positions it for other CRM-type services in the future. She states the primary goals of Farm Bureau are to cross-sell, up-sell, and provide more personalized services for its customers, many of whom reside in rural and suburban communities. "We rely very much on the relationships our agents have with our policyholders, and we want to empower our agents even more," she says.

Cypher believes outsiders have an image of Farm Bureau as not being as progressive as the company really is. "We're undergoing a major effort to redevelop a strategic plan to make sure we have a clear road map to the future," she says. "We don't want to be the leader of the pack because that is too risky and costly for a company our size. But we're able to stay in the middle front, which is pretty good for all the products and services we offer."

Being connected is important to Bob Eshelbrenner, vice president and CIO of Hastings Mutual Insurance. When Eshelbrenner left CNA and Chicago five years ago to be a CIO for a small-town carrier in Hastings, Mich., he was understandably worried about attracting qualified people to the property/casualty carrier and staying on top of what's happening in the world of technology.

That's where his contacts come in. With over two decades of experience in insurance technology, Eshelbrenner has been able to parlay his knowledge into a network of insurance professionals that keeps him on top of key issues. "It's not always just IT," he says. "I try to listen and learn what others are doing on the business side, as well. I prefer more of a network experience and maintaining my own network."

He also believes in listening to those closest to Hastings--the carrier's independent agency force. "The most meaningful thing at this stage of our business environment is to listen to our agents," he says. The carrier holds annual agency advisory council meetings in each of the five states in which it operates. "We place a lot of importance on listening to the agents and what they say they need," he says. "That's not just from an insurance product standpoint but also with technology products."

Eshelbrenner doesn't view the insurance products Hastings offers as that much different from what the competition sells, so the strategy has shifted to how a carrier's technology can ease the way in which a carrier and its agents connect with each other. "We compete with others on how easy the technology is to use and how the agents can best fit [technology] into their workflow and their offices," he says.

Meetings with agents also help to determine the strategic projects the carrier works on. Eshelbrenner reports the number-one project this year at Hastings is to upgrade its commercial rating capabilities from downloadable code that couldn't be executed on the agents' systems to a Web-based real-time rating tool for the agents. "It's a big project for us and one we're targeting to have wrapped up by the end of the year," he says. "That came out of last year's [agent] meetings and became a priority for corporate planning for this year. We'd done it with personal lines, and the agents were telling us to do the same thing with commercial."

Eshelbrenner has spent his career working in insurance technology for property/casualty carriers and counts the five years he spent with CNA as a valuable period in his life. Working for a large carrier put him in a different culture and a more complex organization than what exists in a smaller company, he explains. "With a company such as CNA you have many different business units, so the focus sometimes is a little hard to achieve and it's more difficult to get everybody to agree on priorities when you have needs or requirements that stretch across all business units," he notes.

Another benefit of working with a bigger company is the larger budgets, he says, which allow for trying things that could be discarded if they are proven not to be successful. However, "being a small to medium-size company, Hastings has to be a little less out on the leading edge and stay more with proven technology and products as well as technology that's been commonly used in the market," he says.

That means, with a staff of 55 on the IT side, the primary approach is to buy solutions when the company needs to replace or upgrade major components of software. Eshelbrenner is proud of the work his staff performs, however, pointing to smaller systems that were built internally as well as the company's Web site.

He is enthused about his work at Hastings. "It's certainly an exciting time," he says. "The costs are not taking things out of the realm of possibility for a small or medium-size company to take advantage of today's technology."

He points to the work being done by midtier carriers in imaging and workflow. "I've spoken to my compatriots, and I believe in my informal survey [imaging and workflow] actually have gone further with the smaller companies than with large companies," he says. "I think the large companies look at [imaging] and think it would be nice, but they believe it is so monumental to get their arms around it they back off." The Web is another tool that has made life a lot easier. "The ability of smaller companies to be competitive and get their products out there has been facilitated by the growth of the Internet," he says.

When one thinks of Hawaii, what comes to mind is beautiful beaches and the aloha spirit. Jeff Fabry, vice president and CIO of the Island Insurance Companies, would be the last person to argue with that image, yet looks can be deceiving--Fabry has encountered great challenges since moving to the island state.

"One of the biggest issues we face here is the tight job market and the fact unemployment is low," he says. "There are not enough IT resources around, and it's difficult to bring IT resources across from the mainland because the cost of living here precludes that, especially for your standard programmers, developers, and business analysts."

It is tough for tech people to come to Hawaii and earn enough money to afford the cost of living, particularly given the high price of real estate on the island. When he arrived at Island, Fabry had to develop strategies to overcome the hurdle. "What we've done is to rely on some offshore talent, but more important, we've tried to build a strategy around finding best-of-breed vendors to provide solutions," he says.

Island is in the process of developing an SOA architecture. "We've taken our core back-end system, the WPC system by CGI, and we're building a data services layer around that so we can plug into an enterprise service architecture we've created," he explains. The strategy will allow Island to look for vendors in the future that play well in the SOA architecture space. "Plug and play, so to speak," he says.

SOA is being built into Island's overall strategy for IT. Some companies put their toe in the water with some simple things, but Fabry claims his company is hanging 10 with SOA. "We're going to move the transaction closer to the front end," he says. "We're not only wrapping our back-end systems, but we're trying to leverage the capital we've invested by building data services around [the systems]."

For example, Island has purchased the Duck Creek rating engine and is using a product from RiskClick as an expert underwriting system that will allow the independent agency force to quote, bind, and issue. Both will plug into Island's SOA architecture. "We're revamping our agency and customer portals, and that will be available by the end of the year," he says. "We've said this is going to be our strategic architecture, and we're going to make it part of everything we do."

Fabry doesn't feel stranded in paradise, since he makes several trips a year back to the mainland for conferences and meetings with consultants. "We haven't had much problem staying abreast of technical issues," he says. "We've built a close relationship with Celent, going over our plans and what's new in the marketplace. It's important to keep up with that. We haven't had any problem getting Celent's people to come visit us here, either." Somehow that isn't surprising.

The reinsurance business presents a unique set of challenges to an IT professional such as Ursuline Foley, CIO of XL Re. Foley has had to develop a global perspective on both technology and business issues, since XL Capital, the parent of Foley's reinsurance arm, is based in Bermuda and Foley's IT operation supports work done in 11 countries around the globe, while she herself works out of an office in Connecticut. "XL still is maturing as a company and sets high aspirations," she says.

Fulfilling those aspirations is what sets Foley apart, particularly because XL, through an ambitious acquisition phase, has operations in so many countries. She has to deal with both time-zone and cultural differences, not to mention the fact many of the reinsurance companies purchased by XL Capital historically did things their own way. "[Acquisitions] have to conform to a global segment, which is a radical change for them," she says.

There are certain lines of business that may be written in a select number of countries, but Foley believes the fundamental reinsurance business is similar at a high level across the globe. While "there definitely are nuances in local markets you have to understand," she points out, "you need a close partnership with the business in order to get behind those issues. We constantly are negotiating, partnering, and trying to influence the business units."

Foley stays close to how technology is affecting the reinsurance market through her involvement with the ACORD standards body. The ACORD forum allows her to network with her colleagues in the industry. "It also helps us understand where both our competitors and colleagues are going," she says.

She tries to share any written materials she brings back from industry events at staff meetings, but she doesn't want members of her team to depend solely on her occasional visits to industry conferences. "I encourage them if they see some new technology to take part in a Webinar or a conference," she says. "Technology is moving in so many directions and so fast, I certainly never would claim to be ahead of the curve, so I depend on my staff to bring back the latest and greatest technology to our meetings."

What excites Foley the most about her job is when IT successfully has implemented a project and she hears back from the business side the implementation has added value and made its business processes more efficient or better than the competitions'. "Any time we implement a project, we're very focused on delivery," she says. "Any time we hear back from the business unit, that tells us it is using [the product] and wants more of the same."

This isn't accomplished alone, though. Foley stresses it takes a team effort among the 58 employees who work under her direction. "It's really important to have a strong team," she says. "My key managers and their staff are phenomenal; we have open communication and learn from each other. That's what brings me to work every day."

Life can be very complicated for a medical malpractice insurer, according to Darby O'Neill, who is vice president of IT at one such carrier, Princeton Insurance. "Think how much your medical health insurance has changed and how you have had to adjust to referrals, groups, and the new concept of the "doc in the box," with clinics in Wal-Marts," she says. "All those dynamics are happening in the healthcare industry, and [medical malpractice insurers] are directly affected by them. As doctors formulate different business models, we have to adjust to that."

Finding the right technology solutions in this field is difficult, explains O'Neill, because medical malpractice doesn't fall within the traditional insurance model. "There's a lot of grouping and sharing of limits and responsibilities that happen in the medical field," she says. "There's also a long tail with claims."

One of the bigger challenges Princeton has faced recently is from insuring a radiology group that staffs the entire radiology department of a hospital. "So, you don't have the traditional three guys sharing a job," says O'Neill. "It may be a group of 20 sharing two jobs at a hospital. How do you price that? How do you manage that? It gets to be difficult."

O'Neill believes most software vendors are looking to attract a mass audience among the hundreds of property/casualty carriers in the U.S., but specialty lines, such as medical malpractice, have requirements that are harder to fill. "We need all the traditional things, but once you are past that point you need to create some specialties, and those specialties don't always follow the same coverages," she says. "What becomes your insured? Is it the hospital itself or the employees? It becomes a complicated process."

Another challenging factor is there are a few large carriers that take on medical malpractice, but much of the business is handled by regional carriers. "With a small shop, I'm trying to move to a more cohesive solution," says O'Neill. "I'm talking to [vendors] about that right now. It needs to be a customized solution."

Determining exactly what her company needs is the first step, and O'Neill contends being part of organizations such as IASA is helpful. "I've been going [to conferences] for a number of years," she says. "It can be painful in the sense there are a couple hundred vendors there. You have to talk with them, get to know them, and network with companies you're not necessarily in direct competition with. You have to do your homework."

O'Neill also is involved with the Physicians Insurance Association of America. Traditionally, medical malpractice insurers have not worked well together, but O'Neill believes the IT groups at those carriers are putting aside their competitive instincts. "We all have similar situations such as imaging, spamming, electronic forms--different areas where we're not in competition," she says. "So, we're sharing ideas there." And O'Neill brings a lot to that table, drawing from her experiences accrued over two decades in the business.

Is it possible to rise from a programmer trainee to CIO with the same company? It doesn't happen often, but Neal Ruffalo has managed to accomplish the trick at ACUITY, where he also holds the title vice president of enterprise technology. "It's unique compared with what you might find with other CIOs," says Ruffalo.

That's just one of the things that contribute to the uniqueness of ACUITY. CEO Ben Salzmann rose to his position through the technology ranks, serving as the carrier's CIO before getting the top job. Ruffalo jokes such a situation can be "a blessing and a curse," but for him it's mostly a blessing. "Gaining and retaining a seat at the executive table is strategic," says Ruffalo. "I have a unique situation where I report to the CEO who used to be the CIO. I don't have to go through educating him on technology direction. Half the time he's already there. Ben is intimately involved, and that works well for both of us."

Ruffalo may have started out as a prot?g? at ACUITY, but having held the CIO post for eight years, he has developed his own philosophy on how to run an IT shop. "A lot of the old clich?s still hold true," he says, citing "lead by example," as one truism. "Fundamentally, the building blocks are the same today as they were 20 years ago, but today we have more unique challenges and opportunities."

Ruffalo has borrowed and adapted a 13-point philosophy he preaches and bestows on the people around him. The points are:

o You can't refuse to accept personal accountability.

o You need to develop people.

o You can't try to control results vs. influence thinking.

o You can't fail to communicate.

o You can't manage everyone the same way.

o You can't forget the importance of profit.

o Make sure you concentrate on objectives as opposed to problems.

o You can't be a buddy.

o You have to set standards, train to those standards, and enforce usage of those standards.

o Strive to train the staff.

o You can't condone incompetence.

o You can't recognize just the top performers.

o You can't manipulate the situation--you have to deal with it head on.

"This is the way we try to operate our business," says Ruffalo. He doesn't force these philosophies on everyone in every situation because he recognizes not all scenarios are black and white. "But if you keep enforcing the idea these are the things that will help us continue to excel and meet the demands of tomorrow, the more viable [IT] will be for the company, because the company leverages and utilizes technology," he says. "We want to be a huge part of the health and the future growth of the company."

Ruffalo doesn't view himself as a sage on a mountaintop. He has assembled his management team with the goal of having its members complement his weaknesses. "I've assigned a couple areas of specialty for each of those managers," he says. "I've asked each of them to be the resident expert in areas such as disaster recovery, agency interfaces, and business intelligence. I can't necessarily be the expert in all those areas, so I've farmed out those things to my managers."

Ruffalo realizes how fortunate he is to be working with a company that understands technology and what it can do. "It's amazing how many of my counterparts grapple with the fact they can't get a seat at the table and constantly are trying to find ways to educate people that IT is not a cost center but an enabler," he says. "I'm fortunate I don't have those distractions and can focus on the needs of the management crew and the board of directors."

Featured Video

Most Recent Videos

Video Library ››

Top Story

6 things to know about white collar crime

Small businesses with less than 150 employees are 10 times more likely to be victimized by fraud than those companies with 250-500 employees.

Top Story

10 tips for lifting safely on the job

Musculoskeletal injuries result in pain, disability and financial stress for injured workers, and employers end up paying for them either directly or through workers' compensation.

More Resources

Comments

eNewsletter Sign Up

Carrier Innovations eNewsletter

Critical news on the latest tech solutions, information security, analytics and data tools and regulatory changes to help decision-makers at insurance carriers keep their business thriving – FREE. Sign Up Now!

Mobile Phone

Advertisement. Closing in 15 seconds.