With all the great minds in corporate IT departments, you would think innovation would be driven from the business world to consumers, but that hardly seems the case these days. Most people can do more on their laptop in front of their 3D television screen at home than they can in their cubicle with the company PC.
In his blog on the CIO Dashboard, Chris Curran asks why this is so. He and co-worker Henry Hwangbo came up with five reasons for this lack of development skills:
o IT has the wrong skill sets
o Cloud services are perceived as insecure
o Open source is mistrusted
o Governance is too restrictive
o Prototypes are underappreciated.
Curran makes some excellent points, but there are some explanations needed for each of his five reasons. IT may have the wrong skill sets, but many IT departments, particularly in insurance, are also dealing with legacy systems. The Web is considered innovative for some of these older systems.
To me, the next three reasons all fall under the same umbrella: risk management/corporate governance. Whether the cloud or open source are secure or not is irrelevant once someone brings up the issue to the executive committee. Corporate governance is designed to fight innovation and it's often doing a good job of it.
As for prototypes, in a Virtual Viewpoint on the Tech-Decisions.com Web site, Cindy Saccocia, the director of insurance industry solutions for Microsoft, wrote: "Many of our insurance customers view [cloud computing] as a way to shift their IT R&D to critical business initiatives and applications by letting commodity-based services such as e-mail, migrate to the cloud."
There's no doubt, though, that many insurers rely on the software community to find new and better ways for carriers to operate. The problem software vendors face, though, is if their solutions are viewed as too extreme they are going to have difficulty selling them.
In our IT Town Hall article this month ("Gotta Wear Shades," p. 14), Great American Insurance CIO Piyush Singh put the blame squarely on the software industry. "There is not enough venture capital being invested that will lead to innovation concepts materializing into solutions for the industry," he says. "There also does not seem to be an appetite among the larger players in the software-vendor industry to invest dollars and be transformational in the insurance industry."
While I was researching Curran's blog post, Novarica sent out a news release on so-called "cool" technology initiatives they have come across in insurance and they plan on reporting on some of these initiatives each quarter. Novarica director Matt Josefowicz lists five in his first report. Hopefully he'll keep finding more, but it could be a tall order.
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