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Strategies to Better Serve Your Customers ACORD Systems Forum 2012
Mike Brown, HP Insurance Services/ May 16, 2012
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. 2
Insurance industry is traditionally risk averse, but…
Market trends are driving the need for change • Savvy, connected customers do their research
− Expect higher levels of service and more tailored insurance products, look for the best rates
− Demand flexible insurance products
• Competitive pressures to gain market share while reducing costs
− Expand to international markets
• Regulatory and compliance changes require ability to respond quickly
• Non-traditional distribution channels
• Technical advancements (i.e. mobility, social media)
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. 3
Innovation is key
To be a leader, insurers must: • Use available data to mitigate risk and improve
profitability
• Focus on customer intimacy & trust
• Update business models
• Improve products, introduce new, more targeted products and products for non-traditional customers
• Increase agility to stay competitive
• Find new ways to increase efficiency and reduce costs
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. 4
Insurance industry trends
Increased pricing sophistication
• Highly granular pricing
• Attract and retain most profitable customers
Celent, “IT Spending in Insurance: A Global Perspective,” March, 2012
Increased use of business intelligence and analytics
• Available data used to mitigate risk, improve profitability
• BI tools to create predictive models for underwriters
Increased use of BPO and SaaS strategies
• Reduce costs
• Access to technology solutions without the cost of infrastructure
Continued rollout of next-generation core systems
• Extend core systems to
additional lines of business
or geographies
Creation of mobile applications
• Consumer and agent mobile apps
• Example: claims applications on smartphones
Aggressive product redevelopment and innovation
• Changing consumer preferences, market performance
• Redesign, re-launch product portfolios
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.
Take advantage of new technologies: Analytics Cloud Model-driven architecture
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Organizations not making use of the data they have
0
10
20
30
40
50
60
0 – 25% 26 – 50% 51 – 75% 76 – 100%
What % of the information within your enterprise is unconnected, undiscovered, and
unusable?
0
5
10
15
20
25
30
35
5- Very effective
4 3 2 1 - not at all
effective
How effectively is your organization accessing information to meet legal/compliance and
operational needs? % respondents % respondents
Coleman Parkes study (commissioned by HP), October 2011
35% say they are not effective at accessing business information for compliance/operational needs
34% say that at least half the information in their enterprise is unconnected, undiscovered, and unusable.
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. 7
Information is power if you know how to use it
Structured data
Information disconnected in silos
Insurer
Renters’
data
data
Life Auto
data
data
data
data
data
data
data
Combine data from multiple sources
From: We know:
Renter’s insurance She lives in a 2BR apartment and she just got married
Auto insurance She drives a Mini
Opportunities :
• Life insurance
• Mortgage
•Homeowner’s Insurance
•Annuity
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. 8
Unstructured data
0
3000
6000
9000
2005 2010 2015
Structured
Unstructured
Exponential Data Growth
• Data from social media sites, videos, audio files, images, emails, text messages, mobile transactions
Convert to practical, actionable information
• Apply strategically across the ecosystem
• Learn more about customer demographic
• Route to appropriate stakeholders
• Better business decisions
• Better customer service
Exabytes
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. 9
Better customer experience
The Internet Client/Server
Mobile, Social, Big Data & The Cloud
Database
ERP
CRM
SCM
HCM
HCM
PLM
MRM
Amazon Web Services
OpSource
IBM
GoGrid
Rackspace
Joyent
Hosting.com Tata Communications
Datapipe
PPM
Alterian
Hyland
LimeLight NetDocuments
NetReach
OpenText
PaperHost
Xerox
HP
Microsoft SLI Systems
EMC
IntraLinks
Jive Software
Qvidian
Sage
salesforce.com
SugarCRM
Volusion
Xactly
Zoho
Adobe
Avid
Corel
Microsoft
Paint.NET
Serif
Yahoo
CyberShift
Saba
Softscape
Sonar6
Ariba
Yahoo!
Quadrem
Elemica
Kinaxis
CCC
DCC
SCM
Cost Management
Order Entry
Product Configurator
Bills of Material Engineering
Claim Processing
Inventory
Manufacturing Projects
Quality Control
Business
Education
Entertainment
Games
Lifestyle
Music
Navigation
News
Photo & Video
Productivity
Reference
Social Networking
Sport
Travel
Utilities
every 60 seconds
400,710 ads requests
2000 lyrics played on Tunewiki
1,500 pings sent on PingMe
34,597 people are using Zinio
208,333 minutes Angry Birds played
23,148 apps downloaded
Unisys
Burroughs
Hitachi
NEC Bull
Fijitsu
ADP VirtualEdge
Cornerstone onDemand
CyberShift
Workbrain
Kenexa Saba
Softscape
Sonar6
SuccessFactors
Taleo
Workday
Workscape
Exact Online
FinancialForce.com
Intacct NetSuite
SAP
NetSuite
Plex Systems
Cash Management
Accounts Receivable
Fixed Assets Costing
Billing
Time and Expense
Activity Management
Payroll
Training
Time & Attendance
Rostering Sales tracking &
Marketing
Commissions Service
Data Warehousing
98,000 tweets
Finance
box.net
TripIt
Zynga
Zynga
Baidu
Twitter Yammer
Atlassian
Atlassian
MobilieIron SmugMug
SmugMug
Atlassian
Amazon
Amazon iHandy
PingMe
PingMe
Associatedcontent
Flickr
Snapfish
YouTube
Answers.com
Tumblr.
Urban
Scribd.
Pandora
MobileFrame.com
Mixi
CYworld
Qzone
Renren
Yandex
Yandex
Heroku
RightScale
New Relic
AppFog
Bromium
Splunk
CloudSigma
cloudability
kaggle
nebula
Parse
ScaleXtreme
SolidFire
Zillabyte
dotCloud
BeyondCore
Mozy
Viber
Fring Toggl
MailChimp
Quickbooks
Hootsuite
Foursquare
buzzd
Dragon Diction eBay
SuperCam
UPS Mobile
Fed Ex Mobile
Scanner Pro
DocuSign
HP ePrint
iSchedule
Khan Academy
BrainPOP
myHomework
Cookie Doodle
Ah! Fasion Girl
Mainframe
• Provide the experience your customers want
• Deliver consistent experience while enabling flexibility
• Provide unconstrained, unencumbered access to information
• Services Anywhere 9
New technology access methods change customer expectations
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. 10
Information Offering in the Cloud
Information Services…
Protect Cloud Services • Archiving • eDiscovery • Electronic Communications
Monitoring & Supervision • ControlPoint • WorkSite • Connected • Policy Authority
Promote Cloud Services • Revenue Optimization • Campaign Optimization • MediaBin • Explore • NewSocial 24x7
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. 11
Deliver meaningful outcomes across the insurance enterprise
Marketing Risk mgmt. Sales Customer HR, IT Value chain
• Marketing effectiveness
• Targeted advertising
• Social media
• Market targeting and segmentation
• Sales force effectiveness
• Integrated customer experience
• Underwriting analysis
• Feedback analysis
• Product design
• Marketing
• Claims analytics
• Systemic fraud models
• Compliance & risk
• Archiving
• Workforce optimization
• IT performance management
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. 12
Claims – a good test bed for Connected Intelligence Social data in claims • Use data found on social media in claims process
• Difficult for retail insurance carriers with millions of customers
Fraud analysis • Use advanced techniques to identify fraudulent and potentially fraudulent claims
Fraud scoring • Use automated rules to assess likelihood of fraud based on key indicators from multiple sources
Predictive modeling in claims • Proactive management of claims
• Tune workflows to expected volumes and severity based on predictive estimates.
Claims costs can account for up to 70% of P&C insurers costs
http://www.1stclaims.co.uk/articles/whiplash/car-insurance-premiums.php
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.
Take advantage of new technologies: Analytics Cloud Model-driven architecture
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. 14
• Build & consume right mix of services based on service requirements
• Leverage best of traditional IT, private, managed & public cloud
• Manage & secure hybrid environment to reap value & mitigate risk
“Services Anywhere” with hybrid delivery
Build on-premises cloud services
Consume off-premises services
IT Imperatives
Manage & Secure
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. 15
15
Hybrid delivery engineered for the agility
Evolving Current State
Disparate Architectures Different Management & Security
Inconsistent Development Environments Increased Complexity
Traditional IT
INFORMATION
APPLICATIONS
INFRASTRUCTURE
Dedicated Physical
Homogenous Inflexible
Future
Common Architecture Converged Management & Security
Open & Standards Based Develop Once, Run Anywhere
Flexibility & Portability
Traditional Managed Cloud
Public Cloud
Private Cloud
APPLICATIONS
INFORMATION
INFRASTRUCTURE
APPLICATIONS
INFORMATION
INFRASTRUCTURE
APPLICATIONS
INFORMATION
INFRASTRUCTURE
APPLICATIONS
INFORMATION
INFRASTRUCTURE
Private Cloud
Traditional
Managed Cloud
Public Cloud
INFORMATION APPLICATIONS
INFRASTRUCTURE
15
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. 16
Free up resources to focus on innovation
With Cloud delivery • Align infrastructure costs to business volumes
• Take advantage of structural environment already in place without building out own environment
• Security for highly sensitive information
• Different business model for buying applications
• Flexibility to grow or shrink with cyclical nature of insurance business
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.
Take advantage of new technologies: Analytics Cloud Model-driven architecture
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. 18
Why is Model Driven Architecture Important?
Provide more control to the customer
− User interface- control over productivity
− Product development- respond to market needs without vendor support
− Rules and exceptions- control and change corporate standards
• Add incremental value through new releases and upgrades without impact to the customer
• In a multi-tenant public cloud environment, update software without impact to users
• Increase agility and ability to respond to analytics and market drivers
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. 19
Innovation for the risk-averse
Model-based architecture
Discover and focus on most promising market sectors
• Calculation engine for actuaries for complex product development
• Pre-defined business and calculation models
• No coding
• Discover new ideas, experiment, and validate
Innovate product offerings
Bring new products to market quickly while minimizing risk
• Traditional product development requires coding, testing, system developers
• Configuration over coding
• Use Industry Standards (ACORD,
XML, etc.)
Improve time-to-market
Increase operational efficiency
Enhance customer service
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. 20
Benefits of Model-Driven Development Approach
• Modeling, not coding • Translate business design into set of modeled
artifacts • Business-driven development through
modeling plus business rules engines
• Greater levels of reuse over traditional systems
• Speed product development to address market and regulatory forces
• 25% - 40% savings in the cost of delivering and maintaining systems
• Maintenance programs offer greater value as ‘black box’ upgrades possible
• Reduce implementation and training costs
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.
“ Investing in new product development and expanding the product catalog are the most difficult things to do in hard times, and also among the most important. “ David Packard (1912-1996) Co-founded HP with William R. Hewlett
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.
Thank you
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