editorial

As we head into the final lap of 2007, it's the traditional time to reflect on what made the last year noteworthy. So, in keeping with tradition, let's take a look.

Scanning the spectrum of insurance technology, I believe one factor leaps above most others. From policy administration to claims to document management to underwriting to most other systems (for more on latest in contact centers, see “First Contact”) a key driver has become the customer, whether producer or client. This probably isn't unique to 2007 (or even insurance), but the tide continues.

Another aspect of this ongoing trend that can't be ignored is the much-maligned acronym CRM. Hotly hyped several years ago, failed implementations turned the technology into the leper of options. Interestingly, though, insurers are adopting various parts of the CRM experience–from being customer centric to achieving centralized customer views.

Not long ago, I came across an article, “The Return of CRM,” on the btobonline.com Web site. It brought together some interesting statistics and insights. On the stats side, it quoted Forrester as projecting total annual revenues for CRM providers are expected to be $8.5 billion this year and $11 billion annually by 2010. BtoB also cited Gartner as forecasting CRM spending exceeding $7.4 billion and growing to more than $11.4 billion in 2011.

As for the article's insights, it remarked: “Due to the rise in the availability and sophistication of customer analytics tools and the ability to use those tools in conjunction with CRM, direct marketers can get closer to the holy grail of reaching customers with relevant, targeted marketing messages.” One Forrester analyst even said marketing executives “feel that analytics are the key to unlocking the value in CRM applications.”

This may then be the real differentiator of the year–predictive analytics. Granted, this is purely anecdotal, but whether in conference programs, Web seminars, or old-fashioned discussions with industry members, these two words have buzz about them.

In last month's online conference, Rebecca C. Amoroso, vice chairman, U.S. insurance leader at Deloitte, spoke on predictive modeling trends. In addressing the value proposition, she indicated companies must decide what actions will be taken and how a company can use the model. The areas she pointed to were loss ratio improvement, expense reduction, profitable growth, and ease of doing business.

A popular phrase once was “analysis paralysis”–usually belittling anyone mired in research at the expense of action. Now, in 2007, we're realizing it's the analysis that makes an action more effective, if not more competitive.

Wishing you a happy holiday season . . . and a year filled with insightful analysis!