Loud & Clear

With today's insurance CIOs seeking an equal voice at the senior executive's table, their ability to communicate is as important as technology knowledge to explain what IT can do to make life easier for their business partners. Whether dealing with staff, customers, or the executive team, those who make their words and deeds clear to all have what it takes to be successful.

The technology is the easy part of the job, asserts Piyush Singh, CIO of RLI Corp. A native of India who came to the U.S. after a stopover in laid-back Jamaica, Singh is an example of the ability to adapt to one's surroundings. CIOs have to know their technology, but the ability to understand their surroundings and communicate with the staff, the bosses, and the customers is what separates the good CIO from the bad, and the CIO from the CTO.

It doesn't matter what level of technology knowledge you have, according to Singh, or how deep your knowledge of solutions. "What matters is what you communicate, how you communicate, and how you can cater your communication to the environment you are dealing with," he says. "It is more important for technologists [to communicate] because we all get affected by the environment we are in. What really matters is whether we can relate [knowledge] to the environment we are talking to."

The Lineup

When searching for a CIO, insurance carriers are looking for a seasoned, senior general manager who has a functional expertise in and around technology and can bring a strategic viewpoint to the business, notes Kristin Wait, consultant with the executive search firm Spencer Stuart. Insurance carriers need people who have a business approach and understand how to do something on a cost-efficient and global basis, she adds.

The typical CIO in an American insurance company is a gray-haired male, white, and in his late 40s or early 50s, comments Andreja Bozovic, co-founder of the consulting firm Insurance Technology Group. "That would be the predominant picture of a CIO," he says. Bozovic is finding a large number of women in the right-hand roles to the CIO–an assistant CIO or vice president of IT. "We've seen the number of women in these roles steadily increase over the past five years," he continues. "We certainly have seen more women CIOs recently than we did five to 10 years ago. We've seen [women] run some competently managed shops. That's certainly refreshing. But that doesn't mean a whole lot has changed in IT behavior in the insurance industry. It has remained every bit as conservative and risk-averse as it was before."

Gender Movement

There remains a need for diversification at the CIO level, Wait believes. "I think it's been increasing, and it would be great to see more," she says. "Diversification has increased, but there still is room for more [diverse] people at the top. That's something a lot of our clients are looking for. Diversity is very important to them. If we could find diverse candidates who are suitable, they would be very excited about having them as a part of their organization. They want to look at them as candidates, and they want to hire them."

Catherine S. Brune, senior vice president and CIO at Allstate Insurance, affirms the continued need for diversification. "Having wonderful role models like [Barbara] Piehler [CIO at Northwestern Mutual Insurance] and [Barbara] Koster [CIO at Prudential Financial] will encourage others and show what's possible," says Brune. "So, I'm certain we will see this trend continue, even throughout the corporate world."

Sustaining these gender gains relies on women executives, just like their male counterparts, delivering on critical success measures. "These include delivery of results and contribution to the bottom line, innovation and process improvement, and leadership with our business partners, which help our companies compete and reach new levels of success," adds Brune.

Northwestern's Piehler agrees it is extremely satisfying to see women moving into the CIO positions. "I've met very talented women just below the C level whose skills should propel them to the CIO level in the future," she says. "We need to nurture qualified women within organizations, helping them build relationships and gain visibility for their talents."

Ethnic Makeup

Bozovic doesn't believe the ethnic makeup of insurance CIOs has changed greatly, although some minorities are on the rise, particularly from India. "We've seen more [technologists] of East Indian background than any other [minority], which is interesting," he says. "As we all know, IT is one of the major industries in India, and that spills over. I think that's why we're seeing a lot of [IT people from India] in North America as well as outsourcing, which is one of the things picking up in the insurance industry."

Emigrating from India, Singh has been working in the U.S. for more than 11 years–all of it with RLI and all of it in Peoria, Ill. "I'm very happy in this place. It's just people ask, 'How could you land in Peoria, Ill.?' I was working in Jamaica with Pricewaterhouse [before joining RLI]," he explains. "[Jamaica] is a great place to live but not a great place to raise your family."

One of the challenges Singh has faced was adapting to the different lifestyles of the places where he has lived. "The pace of life is very different in Jamaica than the pace of life in the U.S.," he points out.

When Singh arrived in America, his assessment was people here tend to achieve a lot more during a 24-hour period than people in different societies. Americans are more scheduled. "When-ever you move from one culture to another, you go through two major aspects," he says. "One is called deculturalization. You are deculturalizing yourself from certain aspects of things you were used to beforehand as you are moving into a new environment. The other part is you culturalize yourself to certain new aspects." The pace of life is one change–not just from Jamaica to the United States but also from one area of this country to another, according to Singh.

Up the Ladder

Moving up the ranks is a traditional path to success for American business people, but things are changing today as variety of experience becomes more important. "Just having individuals who are from the development side or the infrastructure side is something we saw in the past as people got promoted up through silos," says Wait. "We're seeing now people need to have well-rounded backgrounds that cover infrastructure, architecture, development, and strategy and possibly have run or been in businesses that are ancillary and are stepping up to this stage from numerous stopping points along the way."

Businesses are looking toward someone who is a technologist but also understands how to apply technology in a business environment and can help the executive committee get focused, decide where it is going to take the business, and determine what role technology is going to play, according to Wait.

Bozovic can't point to any certain qualities that would make a great CIO. "I believe people who have come more from the business side of insurance and understand the business well would make for a better CIO than someone who is just technology focused," he says. "A CIO in an insurance company necessarily has to be part of the executive suite. A chief technology officer does not. That's the distinction I would make."

Communication Is Key

"Communication is a very different aspect in different cultures, different languages, and different environments," says Singh, noting author E.T. Hall explained communication as low context or high context. "The U.S. tends to be very low context," he says. "What it means is language is used in a very specific, clear, and unambiguous manner. What people say is really what they mean in the U.S. context. As you come from a different culture or as we relate to people in different cultures now that the environment is fairly diverse in the community, it's something people need to develop a better understanding of."

The things that are important in communication in this country aren't as important in others. "If you went to the Middle East, language is very much an art form," says Singh. "Context is very important for them. To them, language is not as specific as it is for us."

In a business environment, as you take on more leadership, communication is extremely critical because you are dealing with people all the time. "It's the classic story in communications," he adds. "It doesn't matter what you are talking about; what matters is how people are interpreting it. When you are speaking, you have to be cognizant of your audience. Who is your audience, and what are that audience's expectations? What people don't relate to and take forward is how to better understand your audience."

IT leaders are finding people in the U.S. work environment from all kinds of subcultures. "These people have very different influences," says Singh. "As a result, I think it is important for leaders to spend a lot of time with people to understand those aspects–as leaders communicate, as they make decisions, as they try to build their people skills."

When speaking to newcomers to America, Singh believes it is imperative to stress the importance of communication to make people understand how critical it is to use clear and specific communication in the context of business. "People in other cultures mix a lot of their interpersonal lives with their business lives," he points out. "In the U.S. environment, [business and pleasure] are fairly distinct. Business friends tend to be more acquaintances, whereas in the social world it tends to be a lot different. That's an area people coming from a different cultural background need to understand."

Rare Movement

CIOs who come to insurance carriers from the business side are rare, indicates Bozovic. He believes that is one reason the insurance industry–compared with other financial services verticals–lags behind in terms of using IT to its advantage. "Insurers do spend a lot of money on IT," he says. "Don't get me wrong; their budgets are huge. But a lot of it is spent on maintaining stuff they already have, but it doesn't necessarily support or promote new business strategies or new models of doing business."

Over the last few years, Wait maintains there has not been a huge amount of movement at the top of IT departments. "There have been a lot of people who have risen to the top in their respective organizations and have stayed," she says. "There have been some nice long runs."

In addition, some CIOs now are running through that top technology position because it's part of their rounding out for very senior general management roles. "There are a couple of larger institutions right now where you'll see people who have stepped from business roles into the CIO position," says Wait.

Wait remarks she has dealt with strong CIO candidates from other areas of financial services who are interested in moving into the insurance field. "I've found [insurance] attractive, especially looking at some of the distribution and connectivity challenges in that side of the business," she says.

Geography also is a big factor in the amount of movement among insurance CIOs, according to Bozovic. "We've seen a lot of movement in CIOs, but that mainly was with large companies and some of the East Coast companies," he says. "When you start to move west, you see less movement. In other financial services verticals, there is a lot of movement going on."

Listen Up

Technology leaders in many large organizations clearly have a voice at the top level, Wait asserts. "If you look at the expense line and how much this part of the organization costs and with the additional regulatory and compliance issues that a lot of financial institutions are facing, there've been substantial increases to meet new regulatory requirements–these are issues that definitely have a seat at the top table," she says.

When IT executives are seeking new positions, Wait doesn't believe salary and benefits are the only issues being explored. "When they look at the next position, they want to make sure they are in an organization where they are focusing on improving, changing, and growing the business," she says. "They are interested in ensuring they have a voice at the table by reporting to the appropriate executive committee member. They want to be with a company where the energy is being marshaled around technology issues." Also, CIOs are looking for creative solutions these days, she adds, perhaps a combination of their own talent and exterior talent from outsourcing to find the most creative and appropriate solution.

One thing Bozovic feels is unchanged is the relationship between the IT department and the other business units of insurance carriers. "The business and IT still are not working hand in hand," he says. "Except for maybe the really large players in the market, there are few truly empowered CIOs–equal partners in the executive suite."

In comparison with IT departments in other fields, Bozovic believes executives in insurance value technology less than in other industries. "What manufacturers realize in their production plants is if they didn't have automation available to them, they would have nothing," he says. "I don't think the insurance industry sees it quite that way or realizes how important IT is. The industry still sees IT as a service it will rely upon and expect things to happen as opposed to having IT folded into the overall business of the company."

Bozovic is somewhat bewildered by the lack of respect given to some CIOs. "An insurance CEO deals on a daily basis with risks a banker wouldn't touch with a 10-foot pole in his lifetime," he says. "On the other hand, banks seem to be more open to using technology to their advantage and focusing on their core competence, which is banking, than insurance companies do. A lot of insurance companies treat IT as a service, and therefore, the CIO is somehow not a part of the executive suite."

Despite that lack of respect, Bozovic finds carriers to be extremely protective about technology because of the risk they underwrite. "[Insurers] tend to be protective about their business, and that includes IT to the point they see it as one of their competitive advantages," he says. "Instead of focusing on their core business and giving IT more latitude, [insurers] tend to cloak it all under some form of corporate protectiveness."

Good Name

Good communication skills, however, can be key to helping increase the respect factor. When CIOs have to present information to the rest of the executive team, the ability to make that information relevant is the difference between approval and rejection. "I think IT gets a poor name sometimes because we are not good communicators as to the value we provide to the business and how things will affect and change the business side," concludes Singh. "Communications and people skills are important aspects. My job, the way I look at it, is to get the best people around me. I know that's not a unique thing, but if you get the right people in the right places, keep them motivated and keep them challenged, you celebrate the victories, learn from the failures, and keep moving along."

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Loud %amp; Clear

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