A year since going public, Prudential Financial has experienced some change in its focus, according to Bill Friel, senior vice president and CIO. Weve always been customer focused and strived to align corporate IT initiatives with corporate objectives, he says. As a new public company, were focusing on three main areas: increasing revenues, reducing costs, and making continued improvements in keeping our customers happy. He cites a recent project as an example of the cost-savings part, successfully collapsing one of Prudentials three data centers into one of the remaining two. The goal was to maintain the level of service while reducing costs substantially.
Prudential certainly is one of the best known and largest brands in the insurance marketplace. It has $557 billion in total assets under management and administration as of June 30, 2002, and approximately 61,000 employees. Prudentials demutualization occurred at the end of 2001. It was a mammoth multiyear project involving a major number of our own resources and a number of outside contractors, Friel says. We set up a massive parallel processor machine just for the calculations alone. Finding all of our policyholders [who became stockholders] was a large sub-project, and the mailing was the largest private mailing in the history of the U.S. Postal Service.
Friel joined Prudential in 1988, coming from a successful background with companies well known for their heavy computational capabilitiesAutomatic Data Processing (ADP) and J.C. Penney. He started at Prudential as vice president of information systems, moved through some other positions, and became CIO for the entire operation in 1995.
Prudential looks to technology to control and reduce expenses. Friel mentions a specific example of a recent rollout of a major software implementation. We gave primary responsibility for the development of this new system to Prumerica Systems Ireland, a wholly owned software-development subsidiary [which has a staff of more than 250 employees] located in Ireland in rural Letterkenny, County Donegal, he says. After a few back-and-forth physical visits to set up the project, the insurer and Prumerica had over a hundred Lotus Sametime collaborative sessions over the Web to effect the knowledge transfer needed for the project. It was so successful [that] the project was rolled out on time and on budget without a single Sev 1 [severity] error.
Federated Infrastructure
We operate on a federated model, Friel explains, describing Prudentials structure. He has five CIOs and one CTO who report to him, and the IT staff numbers between 5,500 and 6,000. Each CIO is responsible to his own business unit, and the CTO is responsible for the entire Prudential infrastructure. The three primary operating units are Prudential Investments; Prudential Insurance, which includes the companys individual and group life operations and its Prudential Property & Casualty Insurance Company subsidiary; and International Insurance and Investments. We have a number of subsidiaries, each with a head of technology who isnt actually a CIO, he adds. The federated model allows Prudential to set standards and implement cost savings across the enterprise while keeping the control of technology close to the business units that each technology head serves.
A textbook example of this is Video over IP. In addition to slam-dunk uses such as training, Prudential implements it for, say, presentations from the chairman or key stock analysts, or other similar sessions, which then can be scheduled at fixed times or on a continuing loop. On our own campuses, where we have more than enough bandwidth, its virtually free, he says, other than the actual hardware and software, neither of which are expensive.
Avoiding IVR Hell
Another technology Friel has high hopes for is speech recognition. He sees it as a way to get out of IVR Hell, referring to the common automated telephone menu choices we all are forced to navigate. Imagine just being able to say, Balance, please, instead of going through all the menus, he remarks. The customer experience improvements can be significant.
Friel also has high expectations for wireless technology. Prudential uses it for those employees for whom it makes sense. The insurer supports both Palm and BlackBerry (Research in Motion) wireless handhelds for employees.
Improved customer choices, he says, are where the important implications of wireless are. Weve made a corporate commitment to wireless, he says, even though the countrys build-out of the infrastructure hasnt proceeded as fast as hed like. As each company unit implements Web capabilities, it also matches it with wireless services. Today, you can check your account on your wireless, move funds around, find a local office, or do any one of a number of other functions.
There will always be functions, such as reporting a death claim, where we want our customers to have real, caring people to talk to, he states. However, there are a lot of times when the customer would actually prefer the privacy of an electronic interface.
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