CNA CIO Jane Possell Counsels Community in the Cloud, Evolutionary Transformation

CNA CIO Jane Possell Counsels Community in the Cloud, Evolutionary Transformation

(Image source: Guidewire.)

The need for community among Guidewire (San Mateo, Calif.) customers and the importance of thinking in terms of incremental “evolution” rather than “big bang” approaches to transformation were among the themes explored by Jane Possell, EVP, Global Chief Information Officer, Analytics, Operations at CNA Insurance (Chicago) in her customer keynote on the first day of Guidewire Connections, the vendor’s annual user group meeting, held this year at the Gaylord Opryland on Monday, Nov. 13. Possell spoke about her Connections address with Insurance Innovation Reporter.

“Community” is the theme of this year’s Connections, and Possell addressed it as an urgent imperative at a time when Guidewire was gaining a broader footprint in the cloud. “It’s becoming increasingly important for their customers to connect and be able to align on the types of product innovation that Guidewire is going to continue to deliver in the cloud,” she said. “Because we’re all going to need a lot of fundamentally similar things, including the ability to have our own strategic differentiation.”

The industry’s progress in the cloud touched on a perennial question in the industry, Possell suggested, regarding the degree to which every insurance company was unique and the implications of that belief on technology development.

During her first job in the insurance industry, Possell recalled how she was tasked with maintaining a policy administration system at a major insurer. “It took me a while to get familiar with the application in all its complexity, but I kept thinking that the insurance process itself was not that complicated—you provide a quote to a customer, and if they want to buy it, you issue the policy; you may have to deal with changes on the way; and when the term is up, you either renew, cancel or simply don’t move on to another term.”

As true as that observation may have been, Possell says that she nevertheless had to acknowledge the complexity and inflexibility of the underlying software. Noting her serving as head of Accenture’s policy administration and underwriting practice for 10 years and working for many clients, she said she often heard carriers ask whether there must be a better way. “For a while there were many software players, but nobody had it quite right,” she recollected. “It took a long time for two or three top players—of which Guidewire was one—to emerge.”

Even with the advances in software, implementation remained complex and costly. Possell says that cloud, along with a more incremental approach are necessary to reduce the cost and complexity of technological change at insurance companies.  “At CNA we’re taking a ‘core evolution’ approach to our transformation into Guidewire’s cloud,” Possell related.

Possell noted that cloud presents a significant opportunity of scale, but said that for CNA, and particularly with regard to policy administration and underwriting, the greatest advantage of cloud is the ability to receive gradual, consistent and regular upgrades.

“In the policy administration system space, that’s never been the case before,” Possell remarked. Until now, she added, “the next big version of the software would come out, and you would have to make what was typically a multimillion-dollar decision to either take or decline the upgrade. It was a big project that took a lot of resources.”

By contrast, the cloud brings the opportunity to take much more incremental upgrades, improvements, patches, etc., obviating the need for a massive single jump that could take years to complete.

Greater Business Agility

Cloud also eases integration with external parties, Possell said. Prior to the move Guidewire’s cloud, a client such as CNA could find partners who integrated well with Guidewire, she noted. “However, it’s a huge development to take advantage of their ability to provide cloud-to-cloud prebuilt connections that I don’t have to build myself because I’m not building it out of my data center and into somewhere else,” she added.

The advantage of a cloud-based partner ecosystem, such as Guidewire offers, enables greater business agility, Possell explained. “Of course, I’m bringing these into my cloud ecosystem, but I’m not having to walk it into the four walls of my data center—so the validation of the solutions is much faster from the standpoint of risk and security,” she said.

Before concluding, Possell emphasized that carriers should avoid “big bang” initiatives and think rather in terms of evolution of technology capabilities. “Don’t be afraid to break things down to smaller chunks and be transparent about the benefits of that approach—knowing that you can pivot, if needed, at various points in the program, and enjoy a level of strategic optionality that thinking in terms of these big transformation programs just doesn’t.”

“While it can be scary to think that, ‘If we pivot we may end up, we’ll end up straddling the old and new,’ I would submit that we’re always straddling the old and new, regardless,” Possell elaborated. “We’re always straddling old and new and, hence, breaking into smaller chunks makes it easier to make those investment decisions; it makes it easier to make progress, and it makes it less likely that a program will fall over under its own weight of the necessary overhead.”

True Partner Relationship

Possell also advised carriers to think of Guidewire as a “true partner,” referencing CNA’s long-term, collaborative relationship with the vendor. “When we originally went down the cloud path with Guidewire, we said, ‘You’re going to have a lot of customers who will need to move from on-premise to the cloud; what tools do you have to help them do that?’ At the time, their answer was a bit squishy, so we continued a very collaborative conversation with them. We asked, ‘What could you build, even if you need a co-investment from me? You’ll have a lot of customers asking, ‘What’s possible?’”

Possell reinforced the point by saying that insurers should not assume that because something doesn’t already exist it isn’t possible. “We’ve seen many tools and capabilities that are making our transformation easier because we had very direct partner conversations with Guidewire about what we would need for us to be successful, and for Guidewire to be successful.”

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